I'm a 28 software engineer. I make around 26k, of which about 40% I set aside every month. In my two-and-a-half years working I now have about 24k savings.
I've recently opened an account that allows me to lock money into a savings account - the more time I lock it, the higher the interest. The money is still insured so I don't really risk anything, and the interest rates (ranging from 1% for 9 months to 2.3% for 5 years) seem higher than anything else with the same amount of risk - zero - that I can find around. There is not way to get access to the money (aside from the interest) once it is bonded.
I've read Is there a good rule of thumb for how much I should have set aside as emergency cash? but I don't think I'd feel comfortable in locking up all my money but for 6 months survival with no way to get it back if needed before the end date of the saving period.
My idea was to put around half of what I have into the longest bond (5 years), but I'm not sure whether this is a good idea, since 5 years seems such a long time.
Is putting a substantial amount of money into such an arrangement a good idea? How should a tool like this be used?