I have $1000 extra in my checking that I pretend isn't there for easy accessibility in case of Murphy. All the rest gets sent to my HSBC account which right now is earning 6% (will drop to 5.05% when promo expires at the end of April). It takes 4 days for money to transfer so thats why I keep a BEF in my checking. I also keep an extra $50-$100 in my checking for what I call my 'slush fund' - thats to cover those little unexpected expenses that pop up during the month like gifts, gas, Rx's, etc. that aren't covered by the budget. When I reach my EF goal amount, that $1000 in the checking will be my FF. Then it will be time to start my new car fund.