Where Reserve Fund should be stored?
Where Reserve Fund should be stored?
The question now, where you should put your Reserve Fund? There are two categories that must be met as a storage place for the Reserve Fund:
1. Secure (You will not lose money and the amount is not reduced)
2. Liquid (you can pick it up at any time without penalty.)
Obviously, the deposit is a safe place for your money, because the amount of money that you enter will not be reduced. However, the deposit is not liquid because you can not take it unless it is due. If not yet due, then you will be charged a penalty if will take the money.
There are only four places that you can use to store your Reserve Fund:
1. Your Wardrobe
2. Savings in Bank
3. Giro Bank
4. Money Market Mutual Funds
However, if the amount of your Reserve Fund was felt large enough, then maybe it’s okay to put some into the deposit, provided with a maturity that was not too long, ie one or three months.
