Jack and Lily earn $14,727 a month in combined income. After contributing to their employer 401(k) retirement plan and having their insurance and taxes deducted, they have take-home pay of $7,594 a month. After all monthly expenses are paid, they have a $1,317 surplus.
Questions:
a. How much do they need to have for an emergency fund?
b. What type of account should they have it in, and how much interest will it earn?
c. What type of account would you tell them to invest in if they wanted to save money after filling up their emergency fund? Explain your answer.