How much money should I keep in the bank?

[SomethingClever]

What's a good sized cushion to keep in the savings account?

My initial thought was 2 X our mortgage payment, but that works out to less than one month of "full" expenses.

My wife and I both have full-time jobs other than poker, and on a monthly basis, our earnings (not including poker) are around $400 greater than our expenses.

[stabn]

Five dollars.

Actually somewhere around 3x your monthly expenses is a pretty reasonable amount of just in case money.

[LaggyLou]

3-6x the difference between your monthly expenses and the lowest of your two salaries.

[turnipmonster]

is this opposed to investing it? I'd say 3x monthly expenses, but it all depends on your personal threshold and the industry in which you work (i.e. how likely you are to lose your job).

--turnipmonster

[HDPM]

IMO at least 6 mos to 1 year of expenses. Particularly when you have a mortgage. Ideally you will have no mortgage and a year of expenses. It can take a while to get there, but IMO 2X the mortgage is nothing.

[HDPM]

When I posted I assumed he meant other than investments. That is how I took it at least.

[A_C_Slater]

6 month's living expenses minimum.

[SomethingClever]

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6 month's living expenses minimum.

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Jeminy freaking christmas! I've never had that much and I don't suspect I will for quite a while yet.

[ddollevoet]

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6 month's living expenses minimum.

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This is standard. (3-6 months)

[HDPM]

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6 month's living expenses minimum.

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Jeminy freaking christmas! I've never had that much and I don't suspect I will for quite a while yet.

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That may be, but you will get there if you start thinking about how much to keep. Living paycheck to paycheck with a mortgage means no security. Don't fall into the debt trap and the paycheck to paycheck thing if you can help it. Yeah, it will take you a while. But you can't really start to build until you are debt free. That means no mortgage and no other debt. So no, that won't happen in a few months. Just don't believe all the people who say mortgage debt is great and you can invest with nothing in the bank. Wish I had followed this advice sooner myself. /images/graemlins/smirk.gif

[deacsoft]

All of it.

[A_C_Slater]

[ QUOTE ]
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6 month's living expenses minimum.

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Jeminy freaking christmas! I've never had that much and I don't suspect I will for quite a while yet.

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You're not nitty enough. What if your house burns down and you lose your job on the same day? You have to ensure you have enough to endure the worst possible scenario's. I understand that the probability of this is like a million to 1, but still it could happen.

[tripdad]

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6 month's living expenses minimum.

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This is standard. (3-6 months)

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it may be standard, but it is awefully stupid. the most one should keep in savings is enough to keep a free checking account. in my case $250.00.

the rate one earns in a savings account is criminal. put your money somewhere where it can earn for you. if you have 6 months living expenses/salary, you should have enough to get a broker for a flat fee, and trade stocks.

emergencies can be funded with a home equity loan, or a low rate credit card until you can liquidate some assets.

repeat after me, "i will not let my money fester in a savings account because my parents and grandparents taught me to fear going bust."

cheers!

[Jim Kuhn]

You should keep 3-6 months worth of living expenses in a somewhat liquid place. Not a bank per se!

[tripdad]

fair enough.

cheers!

[ddollevoet]

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You should keep 3-6 months worth of living expenses in a somewhat liquid place. Not a bank per se!

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