It’s important to be prepared. You might be concerned about the economy, your job or a natural disaster, so you want to plan ahead. That’s wise. Part of that planning should include where you keep your money, and it’s good to know that deposit accounts are among the safest places to hold your earnings, no matter what the situation.

Deposit accounts are insured

Deposit accounts such as checking, savings and money market accounts — as well as share certificates and certificates of deposit — are among the safest places to keep money because they are federally insured. .

Money held in any of these accounts at a traditional bank or credit union is fully insured up to $250,000 per account owner per financial institution. These funds are guaranteed by the federal government, with the Federal Deposit Insurance Corporation (FDIC) and the National Credit Union Administration (NCUA) providing insurance for their corresponding financial institutions.

If you have additional funds beyond $250,000, you can always open a new deposit account at another institution for further insurance.

Money access is easy with branches and ATMs

With economic uncertainty, you might want quick access to your money when you need it, and that’s exactly what deposit accounts do best. This is especially true if your accounts are held at traditional financial institutions with branches or ATMs where you can make immediate in-person withdrawals.

Alternatively, you might have an account at a predominately online financial institution. In that case, you may have to wait several days for ACH transfers to clear at a secondary bank or credit union before you can pick up your money.

Exceptions to the “easy access” rule are share certificates and certificates of deposit, which lock your money for predetermined term lengths. However, even those accounts can often be closed before maturity if you need your money in a hurry. Terms vary, but early closure usually means forfeiting your earnings.

APY means accounts earn extra

The annual percentage yield from interest or dividends on deposit accounts aren’t great, not even in the best of times. But do you know what they’re better than? That money you’re holding right there in your wallet. Because that’s earning nothing. Cash on hand gets a big zero percent. The APY on pocket money makes savings account APYs look fabulous.

Let the money you already have work for you for as long as it can. Every penny counts, especially in the face of uncertainty. Withdrawing more cash than you need means you are decreasing your earnings.

All your money shouldn't be in your house

We could talk about the problem of being “house poor” and figuratively having all your money in your house, but here we’re talking about literally having all your money in your house. Don’t do it. Keeping hard cash increases the risk of losing your money — whether from theft, your dog eating it, the temptation to overspend due to easy access, or you simply forgot where you put it.

There’s also the plain old fact of depreciation. Inflation, which is the increase in costs for goods and services, will continue, and that means the value of your dollar decreases. Even when inflation gets back to a healthier 2% rate, the cash in your drawer almost inevitably loses value over the time it sits beneath your socks.

Some hard cash on hand is OK

Things happen. Maybe there’s a temporary power outage. Maybe your financial institution’s branches are closed or the ATMs are inaccessible. A situation where you can’t withdraw money from your accounts when you want is possible. In case of an emergency, you might want to have some cash readily available. But that doesn’t mean emptying your accounts and stashing bills under your mattress. Have what you need to cover expenses and get through a few days, a week — maybe up to a month. That’s it. The risk of losing your money is too high to take out more.

Move money with consideration

Getting stressed and making rash decisions often leads to mistakes and unintended consequences. For example, running to the bank and pulling all your money out of your deposit accounts might lead to potential overdraft fees from a forgotten automated payment. Or perhaps a minimum balance fee that you forgot about because you hadn’t gone below the threshold suddenly kicks in. Slow down and consider your options first.

Why we didn't mention investment accounts

Investmen t accounts are a whole separate topic. It’s true that they can fluctuate a lot in short periods of time. With economic instability, you may be concerned about your retirement account. Maybe you have a brokerage account and are wondering if that’s still a good place for your money. Or maybe you’re wondering if investing even more is a better idea. For investment portfolio guidance, please talk with a financial advisor who can discuss your particular holdings and objectives.

Which deposit account is best?

Choosing the best deposit account depends on how you use your money. If you need a lot of access and use the funds to pay your regular monthly expenses, a checking account is probably best. If you’re saving and know you won’t need funds for some time, a share certificate might be a great idea. By doing a little bit of research on APY, potential fees and other terms and conditions, you’ll find an account type that best matches your saving and spending habits.