My wife an I combined make around~300k living in a low-mid cost of living city. We have a 15 year mortgage at a 3.325% rate with a monthly payment of around $2500, but we put in around $4k a month. We invest around 8k a month, and spend the rest.
Right now, our emergency fund is quite large. We have around 50k on it, which is well over 6 months expenses. We we're thinking of lowering it to 30k, which would be about 6 months, but it still seems like a lot to just be sitting there. My questions are as follows:
Would it be better to use the 20k to pay down the house, or invest? I know investing tends to have better returns, but a guaranteed 3.325% sounds pretty good in this volatile market.
What should we do with our emergency fund? 20k seems high and our savings account is pretty low yield. I was thinking about splitting it in two, keeping 10k in the savings account and putting 20k into municipal bond funds with Fidelity (I'm thinking a mix between intermediate and short term to limit interest rate risk). Is this a good idea? If we desperately need the money, we can always withdraw, but our cash flow and credit limit is enough that I think we would still be safe without doing that.
Submitted March 29, 2018 at 09:11AM by AltAccount20180329 https://ift.tt/2IdprZj
