Dave Ramsey says: Keep emergency fund liquid and easy to reach

Dear Dave,

I have about $12,000 in company stock. Could I use this as my emergency fund?

— Jeff

Dear Jeff,

If you want to call that $12,000 an emergency fund, that’s OK.

But if that’s the case, I’d strongly advise cashing out the stock and putting the money in a good, easily accessible money market account – one with check-writing privileges.

Stocks are long-term investments. The only purpose of an emergency fund is to have cash on hand immediately in the event of an emergency.

Specifically, an emergency fund is there to cover the unexpected expenses life throws at you from time to time.

It’s not an investment and it’s not designed to replace income.

That’s why I believe it’s essential to keep your emergency fund liquid and easy to reach!

— Dave

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