Reply to Savings of 2K, better spot than checking

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[quote=Anonymous][quote=Anonymous][quote=Anonymous]I try to keep $5,000 in my checking as my baseline. Every month, I shift $ over $5,000 to a high-yield savings account. Every quarter, I assess whether I should allocate the "extra" money in the high-yield savings account to an extra expense (such as a semi-discretionary home improvement project), invest it, or keep it in "emergency" savings.

OP, are your bills and paychecks really (ever) a surprise? Such that you couldn't transfer money  from a high-yield savings account to cover them? That's how I handle a month with unusually high expenses. [/quote]

So, do you ever dip below $5K? Is that where you base your extra money from? The lowest point in the month?

The way we are paid, it's complicated to assume the income will arrive. DH is paid ONCE a month. Usually the first Friday.  However, it could be the 2nd or 3rd Friday, depending on what is going on in the month (Previous month #s aren't ready yet? He is paid on commission. First week falls on a holiday?)

I'm a contractor and so I never have a reliable date. If I settle into a contract, I sort of know, but even then, those are billed by job. So it could be random. And, if I'm switching contracts, pay is always delayed 2-3 weeks from start.[/quote]

DP: Given this, I would keep a 5k cushion, but that just means when you have a lot, put everything extra in the savings.  If you ever dip below the 5k, just move some of those savings back over--usually takes 3-5 days so you just have to anticipate.[/quote]

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