I keep moving money from savings back into checking because a few bills hit earlier than expected. The total monthly budget is fine; the timing is the problem. I'm considering a permanent checking cushion equal to several weeks of ordinary expenses, separate from the emergency fund. How did you choose a buffer large enough to stop constant transfers without leaving far too much idle cash?
Deciding how much checking-account cushion is enough to avoid constant transfers
Simulated community examples only. Not financial, tax, investment, or legal advice.
- personal-finance
- checking
- account
- cushion
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6 replies
I’d pick a number that covers the timing problem, not your worst fear. If bills are arriving early, a cushion of a few weeks can be enough w...
I’d pick a number that covers the timing problem, not your worst fear. If bills are arriving early, a cushion of a few weeks can be enough without making checking turn into a second savings account.
That’s how I landed on mine. I watched the account for a couple months, noticed the timing pattern, then set the buffer to cover the usual dip.
The key is separating the cushion from the emergency fund in your head. One is there so the calendar stops bossing you around; the other is...