<prompt> Human: Hey all, I have what I hope is a simple question for you all. If I am looking to build an emergency fund, where should I keep it? Ally has an account that has 1.8 apy, and that is pretty liquid, but if an index could yield, on average closer to 10, and be mostly stable, is there a pitfall to using it I am not thinking of?Thanks for all your input.  <response>: SP isnt really stable, per se, when considering an emergency fund. Think of the real scenario that has happened in financial crisis of the past... Recession hits, you lose your job, market crashes. Just when you need your emergency fund because you are out of work is when your fund is down 30.Emergency fund is meant to be in a low risk account, such as the HY savings.There have been discussions in the past that if you have much wealth beyond your efund then it might be better off in an index fund, because chances are over time, you would do better. But, short of having significant additional capital, protect your efund for when you need it. 