facebookHi! I’m a university student working part time, and I have about $5k I have access to. I consider these my emergency funds, but is it advisable to keep these in SSB rather than a regular bank account? - Seedly
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Anonymous

Asked on 04 Apr 2019

Hi! I’m a university student working part time, and I have about $5k I have access to. I consider these my emergency funds, but is it advisable to keep these in SSB rather than a regular bank account?

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Do 50/50 SSB and a savings account somewhere. The started SSB will grow into something more which you can allocate to other investment pots in years to come, and the savings acc will be there for the really rainy days (and if really need to cash out the other SSB half, i'm sure the savings acc half can buy some time :)

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Have to agree with the replies here - An emergency fund is something that you should be able to withdraw almost immediately, and though SSBs do have really good liquidity relative to fixed income instruments, they still do have a lag time of at least the next month. So if you need the 5k now, and you want to redeem your 5k worth of SSBs, your redemption will only be credited into your account by the end of second business day of the following month. Meaning you at least have to wait for about a week or so earliest before you get your money - which doesn't exactly fulfill the "emergency" requirement.

So I would also advise putting it into a high interest savings account, at least protecting you against some percentage of inflation at least.

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Adele

Level 2. Rookie

Answered on 04 Apr 2019

If it is emergency funds, a higher interest bank account is recommended. If you do not have income t...

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