Interest rate in the bank is at the all time low. The time where you are able to get 2% per annum in high interest account is over. With the market at all time high, one question I get is if you should invest your emergency funds?

Should You Invest Your Emergency Funds

“The interest in the bank is so low. I should use the power of compounding and invest in the stock market”.

This is the current narration in Singapore right now and I don’t blame them. Most of us are literally looking at our money stagnant. If you are like me, you might feel frustrations keeping the money in the banks which is “not doing anything”. Here is a quick introduction of compound interest.

Compound Interest

Let’s assume that we have $50,000 that we are keeping as emergency funds. We will be using the following numbers for our illustration.