David Bach gives good advice: Save up some cash for those inevitable “bumps in the road”. I personally feel that you should have at least 6 months worth of living expenses put away in a Savings Account (I use ING), and of course keep a healthy margin of safety in your checking account (2x monthly expenses). One item I disagree with Mr. Bach on: the use of Money Market accounts. In my experience, the returns really suck. I’d stick with ING or Emigrant Direct, where your money at least has a fighting chance to slightly beat inflation.
