Lending Club Blog

Short-Term Savings

A common practice for those trying to allocate their savings into reasonable categories is to set aside some short-term savings for the inevitable unexpected expenses.

Why you need it

We all have unplanned disruptions in our expected cash flow. It can come in the form of an unexpected expense, such as your car breaking down, or an unexpected loss of income, due to layoff or similar. By planning for these situations, you can avoid having to turn to high-rate credit cards to get you through. Of course, readers of the Lending Club blog know that P2P loans from Lending Club would likely be much more affordable than using a credit card if they hadn’t implemented a short-term savings plan yet.

How Much

The general rule of thumb is to have three to six months’ worth of living expenses in your emergency fund. While this number can seem overwhelming, remember to think of your living expenses in the scenario where you need to use your emergency fund: if you’re desperate enough to dip into your emergency account, then you’d probably also be willing to cut back on some of your non-essential monthly expenses. You can use your bare-bones essential monthly expenses as a primary goal, and then increase your amount to include all of your monthly expenses once the first goal has been met.


Most people look to traditional, safe investments for their emergency fund savings needs. These include money market accounts and short-term CDs. These accounts tend to be very low risk and are accompanied by the expected low rate of return. Aside from being low risk, these types of savings methods offer the liquidity that is typically needed to fund the unexpected. If you didn’t need the money quickly, then you could probably think of more lucrative ways to invest.

Building up your short-term savings is a smart thing to do. You’ll be protecting yourself from taking on debt when the inevitable finally comes to pass. There are many ways to save and invest your money, and creating a short-term savings account to handle emergencies is an essential part of all well-crafted financial plans.

Tuesday, November 13th, 2007 at 6:10 am

Comments (0)


Welcome Home

Lending Club named #5 on Forbes’ Most Promising Companies List

Get ready for tax season with Lending Club’s Tax Form Guide

New Adjusted Return Metric

See more
Lending Club Awards
  • Archives z

Recent Posts

A Message to Investors from our President and Acting CEO

Today, our President and acting… Read More »
May 19, 2016

Lending Club Receives Tribeca Disruptive Innovation Award

Disruptive innovation comes in many… Read More »
April 29, 2016

Lending Club Business Financing Review

One of the biggest challenges of owning a small… Read More »
April 27, 2016

Lending Club partners with Funding Circle and Prosper to launch Marketplace Lending Association

Read More »
April 7, 2016

Lending Club Welcomes Maryland and North Dakota Investors!

We’re now open to retail… Read More »
February 23, 2016

What is Lending Club?

More than one million Americans have achieved their financial… Read More »
February 16, 2016

Get ready for tax season! Lending Club Now Offering TurboTax Integration for Form 1099s

Read More »
February 12, 2016

Lending Club Success: Surpassing $16 Billion in Loans

Founded in 2007, Lending Club’s… Read More »
February 11, 2016

Credit Performance Update

Summary: Credit performance of our standard program is coming… Read More »
February 7, 2016

Critical Small Business Financing Issues

A recent Harris Poll survey conducted on behalf of… Read More »
December 17, 2015


We went public today!

Ringing the bell this morning at the New York… Read More »
December 11, 2014

New and Improved Statistics Page

We recently redesigned our Loan Statistics page to make… Read More »
November 13, 2014

Lending Club Honored with Economist Innovation Award

This month I was honored… Read More »
October 15, 2014

Welcome Vermont Investors!

Today, we’re thrilled to welcome residents of the state… Read More »
September 4, 2014

We filed to go public today

We filed a registration statement with the SEC today… Read More »
August 27, 2014

Our Billion Dollar Quarter

We’re excited to announce  that we’ve facilitated over $5… Read More »
July 8, 2014

Is Lending Club Available in My State?

Is Lending Club available in my state? That is… Read More »
July 7, 2014

Lending Club Joins Senator Cory Booker to Discuss Improving Access to Capital for Small Businesses

Read More »
June 20, 2014

Lending Club Named a CNBC Top 50 Disruptor for a Second Year

For the second year in… Read More »
June 17, 2014

PRIME is now Automated Investing

Lending Club is excited to announce that PRIME has… Read More »
May 14, 2014
View All w