Requirements for our short-term savings

When saving, it is not the same to have a contingency saving ot to have it for our retirement. What we look for our savings are entirely different things.

When saving in order to have some money to cover future contingencies or emergencies of any kind, when you invest those savings, we have to lay down two fundamental characteristics:

1. LIQUIDITY: we do not know when will appear a contingency or emergency, our money has to be fully available. Therefore, we can not save or deposits that compromise the availability of our money (or for 1 month or for 3 or for 1 year) nor in products that prevent us recover our investment when we want. The importance of profitability to look for this type of product is practically zero . It's useless to put this emergency savings to an account at 4% if I can not have that amount when that emergency occurs. What I use to have saved $ 6,000 at 4% if I damaged the machine I can not have that much and I have to buy with my credit card and put off buying an interest rate of 15%? Make calculations and see no worth.
2. SECURITY : "The more profitable the less safety, the more security the lower profitability" . This is a rule that always holds and that very few savers / investors understand. If you're just saving up for when these contingencies occur, what must prevail is that when you need to have the entire amount you've allocated for this purpose (no less amount). The search for higher returns in exchange for less security, no sense in the short-term savings.

REMEMBER: SAFETY AND LIQUIDITY FOR YOUR SHORT-TERM SAVINGS