Rule of thumb re: how much to keep in savings? What to do with rest?

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totallynotsure
Posts: 246
Joined: Wed Feb 26, 2020 9:35 am

Rule of thumb re: how much to keep in savings? What to do with rest?

Post by totallynotsure »

i have a decent chunk of change just sitting in an Ally savings account.

i can't help but think i could put this to better use but i do want to have relatively easy access to it. not sure what/when i will need it but i'd say that i wouldn't want to tie it up in an IRA or similar.

advice/insight appreciated. thanks.
Silk McCue
Posts: 8951
Joined: Thu Feb 25, 2016 6:11 pm

Re: Rule of thumb re: how much to keep in savings? What to do with rest?

Post by Silk McCue »

If you’ve fully funded or will fully your retirement vehicles for the year and have a proper Emergency fund many would choose to invest in a Taxable brokerage account holding tax efficient funds such as VG Total Stock Market and VG Total International.

Take a look at the Wiki.

https://www.bogleheads.org/wiki/Tax-eff ... _placement

Cheers
pizzy
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Joined: Tue Jun 02, 2020 6:59 pm

Re: Rule of thumb re: how much to keep in savings? What to do with rest?

Post by pizzy »

totallynotsure wrote: Wed Jan 19, 2022 7:22 pm i have a decent chunk of change just sitting in an Ally savings account.

i can't help but think i could put this to better use but i do want to have relatively easy access to it. not sure what/when i will need it but i'd say that i wouldn't want to tie it up in an IRA or similar.

advice/insight appreciated. thanks.
What percentage of your investable assets is in Ally?
Vanguard/Fidelity | 76% US Stock | 16% Int'l Stock | 8% Cash
capran
Posts: 1091
Joined: Thu Feb 18, 2016 9:45 am

Re: Rule of thumb re: how much to keep in savings? What to do with rest?

Post by capran »

totallynotsure wrote: Wed Jan 19, 2022 7:22 pm i have a decent chunk of change just sitting in an Ally savings account.

i can't help but think i could put this to better use but i do want to have relatively easy access to it. not sure what/when i will need it but i'd say that i wouldn't want to tie it up in an IRA or similar.

advice/insight appreciated. thanks.
An unpopular view: Long ago I saw something about emergency funds and timeline horizons. Something like 3 to 6 months of expenses in your emergency fund. I also saw something about It's generally a best practice not to invest in the stock market with any money you expect to need within the next few years. But I have read elsewhere that investing in the stock market entails risk.
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Sandtrap
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Re: Rule of thumb re: how much to keep in savings? What to do with rest?

Post by Sandtrap »

totallynotsure wrote: Wed Jan 19, 2022 7:22 pm i have a decent chunk of change just sitting in an Ally savings account.

i can't help but think i could put this to better use but i do want to have relatively easy access to it. not sure what/when i will need it but i'd say that i wouldn't want to tie it up in an IRA or similar.

advice/insight appreciated. thanks.
The "rule of thumb" is a starting (not ending) point for each person's unique needs.

Emergency Fund:
(what if you could not work for 1 year and loss that income)?
Liquidity
Security of Principle (not funds, not stocks, zero volatility).
Accessibility (you might need it in the future "now").

Then, with anything over that, add to existing fund structure in proper placement.
j :D
Wiki Bogleheads Wiki: Everything You Need to Know
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