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  1. #301
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    Quote Originally Posted by Name Redacted View Post
    First make sure you have 6-12 months expenses in an emergency fund kept in a money market account,
    That's the conventional wisdom, but I've always thought that leaves a lot of money on the table. Because putting that money in a more risky (but still conservative) mutual fund will bring lots more in returns. And the risk of losing, say, 5-10% in a huge downtown isn't likely to screw up the money's purpose as an emergency fund. Plus, the people smart enough to have this emergency fund are not very likely to need it, and certainly not need all of it. Having $50k or whatever earning money market rates seems like a loss of income (because there are plenty of conservative mutual funds that routinely bring in way more than that, and are still completely liquid).
    "fuck off you asshat gaper shit for brains fucktard wanker." - Jesus Christ
    "She was tossing her bean salad with the vigor of a Drunken Pop princess so I walked out of the corner and said.... "need a hand?"" - Odin
    "I'd eat a bag of Dicks and wash it down with a Coke any day." - iceman

  2. #302
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    Mar 2006
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    Quote Originally Posted by AdironRider View Post
    6-12 months is not necessary in an emergency fund unless you own a business that you rely on to pay the bills or are an independent contractor (consultant, musician, etc). Even then, it is way overkill in almost every instance.

    Never mind it is probably unattainable for 80-90% of Americans in the first place.

    Step away from bogleheads.org, that place isn't real life.
    Emergency fund expenses will still pay you 3.25% to store...

  3. #303
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    Aug 2006
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    I don't disagree on what a money market account will pay out right now, it is just way over conservative to keep 6-12 months in a money market account in all but a few, very specific situations.
    Live Free or Die

  4. #304
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    Jan 2005
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    cb, co
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    Emergency funds really depend on your situation and comfort level. Work for yourself with a variable income and mouths to feed? Probably best to keep a sizeable amount around, even if it only makes 3% or whatever right now.

    Sent from my SM-G996U1 using Tapatalk

  5. #305
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    Jan 2008
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    truckee
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    4% in an insured account seems like a good deal right now. It's not going to keep up with inflation but is anything that's low risk?

  6. #306
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    Dec 2005
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    STL
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    Some nice yields out there. I like MMM or Walgreens/boots.

  7. #307
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    Oct 2007
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    11,695
    Yeah, thereís always folks that argue against the EF. It was nice when the Covid shutdown hit to not really worry about it. If your a 6 month EF is too much for you to save up then maybe investing shouldnít be your first priority anyway.

  8. #308
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    Mar 2006
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    Quote Originally Posted by Name Redacted View Post
    Yeah, there’s always folks that argue against the EF. It was nice when the Covid shutdown hit to not really worry about it. If your a 6 month EF is too much for you to save up then maybe investing shouldn’t be your first priority anyway.
    Given most of you all are middle aged and/or elderly dentists...and you are doing it right, a 6-12 month EF is noise and thus the lost opportunity cost is minuscule

  9. #309
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    Apr 2006
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    4,477
    Buy a 89 suburban, tell your wife to go fuck herself, clean out all the bank accounts, hit the road.

    Get blackout drunk almost daily. Smoke cigs, ski, barely shower.

  10. #310
    Join Date
    Dec 2012
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    16,268
    Quote Originally Posted by byates1 View Post
    Buy a 89 suburban, tell your wife to go fuck herself, clean out all the bank accounts, hit the road.

    Get blackout drunk almost daily. Smoke cigs, ski, barely shower.
    This ain’t the Bitcoin thread.
    "timberridge is terminally vapid" -- a fortune cookie in Yueyang

  11. #311
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    Apr 2006
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    I know Sally

    There is untold adventure and excitement investing in a life on the road. The most important investment you can make is in yourself.

  12. #312
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    Dec 2004
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    Where the sheets have no stains
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    Yeah cause shitting in a bucket or a gas station bathroom and showering every 3 days is sooooo exciting.

    Whateves, if it works for you that is wonderful.

    Kinda like an ex-boss who at 68 years old transitioned from Bob to Cindy.
    I have been in this State for 30 years and I am willing to admit that I am part of the problem.

    "Happiest years of my life were earning < $8.00 and hour, collecting unemployment every spring and fall, no car, no debt and no responsibilities. 1984-1990 Park City UT"

  13. #313
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    Quote Originally Posted by sirbumpsalot View Post
    Given most of you all are middle aged and/or elderly dentists...and you are doing it right, a 6-12 month EF is noise and thus the lost opportunity cost is minuscule
    Lol. The more the money amount is “noise” the less efficient it is. If you are a dentist burning 6-figures a year, you could do more. If you are driving a used suburban showering at truck stops the number is a bit smaller.

  14. #314
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    Apr 2006
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    Quote Originally Posted by Bunion 2020 View Post
    Yeah cause shitting in a bucket or a gas station bathroom and showering every 3 days is sooooo exciting.

    Whateves, if it works for you that is wonderful.

    Kinda like an ex-boss who at 68 years old transitioned from Bob to Cindy.
    Is was humor. A bit of levity. Lighten up nance.

  15. #315
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    Oct 2005
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    Idaho
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    Is it just me or do gas station bathrooms seem a lot nicer these days?

  16. #316
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    Quote Originally Posted by Conundrum View Post
    Is it just me or do gas station bathrooms seem a lot nicer these days?
    Gas station coffee is also orders of magnitude better than it was 30 years ago.
    "fuck off you asshat gaper shit for brains fucktard wanker." - Jesus Christ
    "She was tossing her bean salad with the vigor of a Drunken Pop princess so I walked out of the corner and said.... "need a hand?"" - Odin
    "I'd eat a bag of Dicks and wash it down with a Coke any day." - iceman

  17. #317
    Join Date
    Aug 2006
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    7,579
    Quote Originally Posted by Name Redacted View Post
    Yeah, there’s always folks that argue against the EF. It was nice when the Covid shutdown hit to not really worry about it. If your a 6 month EF is too much for you to save up then maybe investing shouldn’t be your first priority anyway.
    To be clear, I'm not anti emergency fund, but a year is way overkill. 3 months is more realistic.

    Even for the plebes, where the average household income is in the 70k range, that is like 15-20k.

    There are very few emergencies in life where 20 grand won't get you out of that pinch, especially if you are a dual income household (as in it is very unlikely you both are unemployed at the same time) and have health insurance. 1) If you lost your job your expenses will decrease (daycare, commuting, etc). 2) You will probably eliminate bigger ticket items like home improvements or vacations during that time. 3) You can always get a job doing something slightly less than your career aspirations to pay the bills temporarily. I know this is TGR and the dentists wouldn't like to entertain that but most people will when push comes to shove.

    Statements like "you must have six months liquid cash or don't even bother investing" is more bullshit class division than anything helpful. If anything, one should be putting the 10-15% into a 401k then relying on a credit card for emergencies than building a massive cash reserve first.

    And in terms of gas station coffee, the mid-atlantic seems to have it dialed. You can grocery shop at those places even so you can get some TP for the epic shit that will arrive after your gas station coffee.
    Live Free or Die

  18. #318
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    Oct 2007
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    11,695
    Quote Originally Posted by AdironRider View Post
    To be clear, I'm not anti emergency fund, but a year is way overkill. 3 months is more realistic.

    Even for the plebes, where the average household income is in the 70k range, that is like 15-20k.

    There are very few emergencies in life where 20 grand won't get you out of that pinch, especially if you are a dual income household (as in it is very unlikely you both are unemployed at the same time) and have health insurance. 1) If you lost your job your expenses will decrease (daycare, commuting, etc). 2) You will probably eliminate bigger ticket items like home improvements or vacations during that time. 3) You can always get a job doing something slightly less than your career aspirations to pay the bills temporarily. I know this is TGR and the dentists wouldn't like to entertain that but most people will when push comes to shove.

    Statements like "you must have six months liquid cash or don't even bother investing" is more bullshit class division than anything helpful.

    And in terms of gas station coffee, the mid-atlantic seems to have it dialed. You can grocery shop at those places even so you can get some TP for the epic shit that will arrive after your gas station coffee.
    Part of it is about saving up the 6 months EF before investing. Not some class warfare BS. Just financial diligence required to do it. If you are going to save for retirement, the EF should be a drop in the bucket anyway. And while it definitely depends on what you do for a living, and many other factors, like what kind of support network you have etc.

    The whole point is to not have to touch your investments when something bad happens. Remember 2008? Imagine if you broke your leg in a ski crash during that time. Your investments where all of your savings are, are all way down, you can't do your job, you have medical bills piling up, and your home value is down 25% and banks aren't loaning money to anyone. Where are you going to pull money from? Your stock market investments that just took a dive? Those credit cards with 20% interest rates?

    Look, I didn't make this shit up, some other people did and I just follow it, or try to, with what little money I do have. You do you and I hope it works for you. This EF just helps me sleep at night. Some people are more risk takers with money. I've been broke as shit most of my life as a ski bum, and I'm trying to not be back there again.

  19. #319
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    Dec 2004
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    Different strokes and all that but I am with you. And IMO investing (not gambling) is about slow and steady over a long span of time gradually racking up the savings, 20-40 years.
    I have been in this State for 30 years and I am willing to admit that I am part of the problem.

    "Happiest years of my life were earning < $8.00 and hour, collecting unemployment every spring and fall, no car, no debt and no responsibilities. 1984-1990 Park City UT"

  20. #320
    Join Date
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    Park City
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    4,827
    So D. was quitting your job? Hookers, blow and ski everyday for the win. Canít put a price on experienceÖ.or STDís


    Sent from my iPhone using TGR Forums
    I rip the groomed on tele gear

  21. #321
    Join Date
    Jan 2022
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    1,137
    If you are going to hold a huge EF, at least consider ways other than a money market fund to store it. By definition you probably donít need it all on day one of your crisis.

  22. #322
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    Oct 2007
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    Quote Originally Posted by oldnew_guy View Post
    If you are going to hold a huge EF, at least consider ways other than a money market fund to store it. By definition you probably donít need it all on day one of your crisis.
    Examples?

  23. #323
    Join Date
    Dec 2012
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    16,268
    Bitcoin. You'd be up 3% today.
    "timberridge is terminally vapid" -- a fortune cookie in Yueyang

  24. #324
    Join Date
    Jan 2022
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    Some combination of short term t bills, i bonds, CDs, etc.

  25. #325
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    Oct 2007
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    Quote Originally Posted by oldnew_guy View Post
    Some combination of short term t bills, i bonds, CDs, etc.
    CDs are about >1% more than the rate on a MM account right now. And you donít have access without paying the penalty. Lowest you can get is 6 months. Kinda defeats the purpose unless you want to develop a CD ladder.

    I have i bonds outside of my EF. They are rarely a great investment. Only recently have they become attractive and hopefully that doesnít last.

    Maybe the TBills but once again, the payoff isnít much more than the MM and they are more variable than the MM, until recently they were sub 1%.

    And once again, this being a drop in the bucket compared to your retirement saving means that you are doing a lot of thinking about a very small part of your portfolio when you should be more focused on the bigger nest egg. Say you are shooting for a $1m retirement and your 6months is $50k. Why are you even thinking about that EF? It is 1/20th of your overall goal. Just set it and forget it.

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