I think that's a bet that is contingent upon not getting laid off for more than a year during a period when there is 20-30% drawdown. If that happens, then any growth differential between equities and SPAXX's 4% is going to be wiped out -- in which case it was better to have stayed with SPAXX which offers liquidity and modest but stable growth at near zero risk.
It's not a sure win rule.
A better strategy is to hedge (bet maybe 3 months of your 1 year emergency runway), but that requires some acumen.
>A better strategy is to hedge (bet maybe 3 months of your 1 year emergency runway), but that requires some acumen.
Yeah that’s what I was suggesting when I said you don’t need keep your entire 1 year emergency fund in low risk investments (assuming you have much more than a year of runway).
It's not a sure win rule.
A better strategy is to hedge (bet maybe 3 months of your 1 year emergency runway), but that requires some acumen.