You have $3,000 that you may need any day to replace the furnace in your house. Which of the following would be the best place to put the $3000?

Question

Quizplus · Accepted Answer

Since the $3,000 may need to be accessed at any time to replace the furnace, it is best to put it in a savings account earning a relatively lower interest rate but providing liquidity and easy access to the funds when needed. The other options such as investing in a common stock mutual fund or ETF carrying higher returns come with a higher risk of loss in case the market does not perform well. A one-year fixed-rate GIC would lock in the funds for a year, which may not be desirable given the need for flexibility in accessing the funds.

You Have $3,000 That You May Need Any Day to Replace