You have an emergency fund. Now what?
I’ve always been an advocate of having an emergency fund. In my previous blog entries, I recommend that you should have at least eight months’ to one-year worth of emergency fund (see story).
But what if you have already completed your emergency fund? What if you have managed to amass one-year worth of EF? What now?
First of all, congratulations! This is a great way to start your pursuit of financial independence.
Now that you have your emergency fund, make sure you keep this safe and sound. Place it in a time deposit that gives you a pretty good interest rate.
Any money that comes in now can be placed in other investment instruments or earmarked for other goals. If you’re planning to buy a new house, then you can start saving up for the 20% down payment. You can also start investing in mutual funds or bonds. You can also get additional insurance for you if you have dependents. Basically, the coast is clear for any investment you may want to take.