There's a question that always follows the other one.
First you ask yourself how many months of coverage to hold — three, six, whatever number lets you sleep at night if your income stopped tomorrow. I wrote about that in a dedicated article, and there the question ended.
But in real life, the moment you've decided how many, another one pops up right away: where do I put them?
You've worked out that you need, say, €10,000 as a cushion. Fine. Does it sit still in your checking account? Go into a savings account? Is there something better, without turning it into a real investment?
It's a practical, down-to-earth question, and it deserves a practical answer.
One honest premise, valid for the whole article: this is not financial advice. I won't tell you which product to buy, or which bank. I'll give you a criterion to reason with, and a few examples to make it concrete. The choices stay yours.
Liquid doesn't mean "still"
Let's start with a misunderstanding that does real damage.
Many people think "holding liquidity" means just parking the money and leaving it there. The checking account, the balance that never moves, a kind of motionless warehouse.
And since the idea of motionless money is annoying — rightly so — two things happen, both wrong.
Some people keep their entire coverage in a checking account earning zero percent, and every year inflation quietly eats a slice of it.
And some people, so as not to "waste" it, tuck it into an investment they then can't get out of quickly — and when the emergency arrives, they discover the parachute was sewn shut.
Liquid doesn't mean still. It means available.
Let me remind you of the definition, because here it's everything: liquid is money you can use within 24 hours without selling anything else. Not money that earns nothing — money that answers immediately when you call it.
And the good news is there are ways to keep it available and have it earn a little something. Very little, but something, without betraying its purpose. You just need to pick the right tool for the right job.
The criterion that comes before yield
When people talk about investments, everyone's first question is: how much does it earn?
For the emergency cushion, that question goes in second place. First comes another one: how quickly does it come back available, and how certainly?
I call it accessibility.
For the coverage share — and only for that — accessibility beats yield. Always. The reason becomes clearer with an example.
Marco keeps his €10,000 of coverage in a fund that earns 4% a year, but that takes ten days to exit and, at certain moments, you exit at a loss.
For two years he earns €400 a year and feels clever. Then, one Tuesday, the emergency hits: he needs the money within 48 hours. The fund is having a bad day, he exits €600 below yesterday's value, and on top of that he has to wait.
Two years of yield — €800 — burned in a rushed sale, plus the stress of waiting while the emergency presses in.
Coverage isn't the place where you compete for yield. It's the place where you buy certainty of access. Yield there is a small bonus you take if it doesn't cost you accessibility. Never the other way around.
Keep that as your compass for everything that follows: accessibility first, yield second.
Three buckets, by level of accessibility
Instead of thinking in terms of products — which change, carry different commercial names, and aren't mine to recommend — let's think in terms of buckets. Three levels of decreasing accessibility.
The idea is not to put all your coverage in the same place, but to spread it across these levels depending on how quickly you might need it.
Bucket 1 — What you need right away
The first bucket is your checking account. Instant access, zero friction, you pay directly from it.
It almost always earns nothing. And that's fine, because it isn't there to earn: it's there to be immediate.
How much to keep there? The portion of coverage you might genuinely need from one moment to the next. One month of fixed expenses, maybe two. No more.
Anything you keep in the account beyond that threshold isn't working, and doesn't even need to be there to do its job. It's the piece you can move into the second bucket without losing an ounce of peace of mind.
Bucket 2 — What you need within a few days
The second bucket is a no-penalty savings account: a separate account where you park the money, earn a small interest, and withdraw whenever you want — with no lock-in and no penalties.
Watch that word, no-penalty. There are also fixed-term deposit accounts — certificates of deposit and the like: somewhat higher rates, but the money stays locked for six months, twelve, more. For coverage, a fixed-term account is a half-step outside the line — it belongs more to the third bucket, and I'll come back to that in a moment.
The no-penalty savings account is the heart of the cushion. This is where the largest slice of your coverage should sit: available within a couple of days, separate from your everyday account so it doesn't blend in with this month's money, and earning a small yield that at least slows down inflation a little.
There's also a psychological advantage, not just a financial one. Keeping your coverage in an account different from your everyday one makes it less tempting: you don't see it in your everyday balance, you don't "spend it by accident." It's there, still and available, but out of reach of impulse spending.
Bucket 3 — What can wait a few more days
The third bucket is for the more "outer" slice of coverage: the part that, realistically, you wouldn't need in the first 48 hours of an emergency, but a bit further down the line.
Here come very short-term, very cautious instruments.
I'm thinking of short-maturity government bonds — Treasury bills, for instance (BOT, in Italy, which mature in a few months) — or money market funds: very conservative products that invest in very short-maturity securities, from which you can exit within a few days.
They're still close to the idea of liquid — they're priced daily, they convert to cash quickly — but there's a small extra step: a few days of waiting, sometimes a small swing in value, occasionally an entry or exit cost.
That's why I keep them in the third bucket, not the second. And that's why, here, the earlier premise counts double: understand costs, timing, and constraints of each one before you commit. This isn't the place to improvise.
And the fixed-term deposit account I mentioned earlier? It belongs here, in this bucket, and only on one condition: that you've knowingly accepted the lock-in as the price of a somewhat higher yield, knowing that slice won't "answer immediately" when called. If you put it here, put in it the portion of coverage that can genuinely wait.
How it plays out, in practice
Let's put the three buckets together with an example.
Giulia has calculated her coverage: 6 months, equal to €12,000 (fixed expenses of €2,000 a month).
She could spread it like this:
In her checking account, about a month and a half — say €3,000. This is the immediate cushion, the one that absorbs the shock in the first hours.
In a no-penalty savings account, the largest slice — €7,000. Available within a couple of days, separate, earning a small yield that works against inflation.
In the third bucket, the remaining €2,000 in very short-term instruments or in a lock-in accepted knowingly — the part that, honestly, wouldn't be needed in the first few days.
These numbers aren't a formula. They're one way, Giulia's way. Your own mix depends on how likely, in your life, a sudden emergency is compared with one that gives you a few days' notice: someone with a stable income can keep less in checking and more in savings, someone with irregular income does well to pad the first bucket.
The rule, the only one, is the one from before: the more "outer" the money, the less accessible it should be, never the other way around. You don't park the emergency parachute where it takes longer to open.
Coverage isn't dead weight
There's a thought I want to clear out of the way, because I think it's the root of half the mistakes people make about liquidity.
The idea that coverage is dead weight. Money that "does nothing" and that, deep down, would be better put to work somewhere else.
It isn't dead weight. It's time working for you.
Giulia's €12,000 aren't sitting there doing nothing. They're doing the most valuable thing of all: buying her the time to react to an emergency without making stupid decisions. Not selling a good investment at the worst possible moment. Not taking the first job that comes along just because the money ran out. Looking at a problem from above instead of with water at her chin.
You don't see that "return" on your bank statement. You see it in the quality of the decisions you make when things go wrong. And it's a very high return — it's just measured in calm, not in percentage points.
That said, it's precisely because coverage is precious that it shouldn't be wasted in excess. Keeping fifteen months of coverage "just in case," all sitting in a checking account, isn't prudence anymore: it's a piece of your wealth that could be building your Asset+, left to erode instead.
The right amount of coverage, kept in the right places, is neither too much nor motionless. It's exactly the time you need, parked where it answers when you call.
Where Cashfulness fits in
A note on how all this connects to the app, because it's worth being precise.
Cashfulness tells you how many months of coverage you have: it calculates it on its own inside your fix, dividing your liquid money by your fixed monthly expenses. It's one of the four dimensions of your financial health.
And it knows what's liquid without you having to tell it: liquid accounts are the ones under "liquid Asset+" and "liquid Asset−," two system categories that are always there. It isn't a tag you set by hand — it's the structure of the chart of accounts itself that tells the app which money answers the call right away, and that's where it derives months of coverage from.
What you've read here — which buckets to spread those months across — is the next step: a choice you make yourself, outside the app, with your bank and your instruments. Cashfulness doesn't sell financial products, doesn't point you toward a savings account or a fund, has no hidden interest in where you park your liquidity. It gives you the coordinate; the move is yours.
When you record transfers between one account and another — moving €7,000 from checking to savings, say — your fix doesn't change by a single euro.
That's what double-entry guarantees: every transaction recorded twice, on two sides that balance each other, so nothing slips through and your wealth stays true at all times. Shuffling money between your own pockets makes you neither richer nor poorer, and the app reflects exactly that.
Which, come to think of it, is the accounting proof of this entire article's point: moving your coverage into the right bucket does not change how much you're worth. It only changes how ready that money is to defend you.
In one line
Decide how many months to hold — that's the metric.
Then spread them by accessibility: the bare minimum in checking, the bulk in a no-penalty savings account, the outer tail in very short-term instruments you actually understand.
And remember you're not freezing anything.
You're parking time. In the place that answers fastest, the day you call on it.
— Vittorio