My wife and I recently accomplished our goal of accumulating $18k for our emergency fund (figuring that covers 6 months of our ~2k/month rent 1k/month expenses, which should easily be livable).

Currently, this is all sitting in a high-yield Marcus savings account at 1.05% variable rate interest. My dad suggested that I might want to take some portion of this out to have as literal cash sitting in the house in the event of a prolonged electricity outage, which isn't out of the question here in wildfire-prone California. This seems reasonable enough to me, but got me thinking more about how to structure liquidity in an emergency fund.

Cash would be the highest possible liquidity, at the cost of not even keeping a savings account level of interest. So it might make sense to keep ~1k in cash in case the power goes down, but I wouldn't want to keep the whole emergency fund in bills.

Savings accounts are pretty damn liquid, taking only a few days at most to get the money out, and their interest rates put a solid dent in losses to inflation. This seems like a good place for the majority of the fund to stay.

But in the event that we actually need the last 4-6 months worth of emergency fund, we'd presumably have a good bit of lead time to figure out we may need to access that money and plan on making it available for ourselves. This has me thinking about where this might better be put than a mere online savings account. Obviously I don't want to dump it into an S&P index fund since broad market volatility is a large part of what I hope to avoid by having an emergency fund in the first place, but are there any good options for 3-6 month long rotating low-risk bonds, or other investments with slightly-better-than-1.05% returns and limited downside risk (or at least downside risk weakly correlated to the rest of the market)?

How do you structure your emergency fund? Do you keep some part of it in hard cash? Do you have any of it tied up in actual investments rather than just savings accounts? If so, which ones, and how have you balanced protecting it from volatility with trying to eke out a better return? I'm interested in hearing perspectives on this. And don't feel like you need to convince me not to dump the whole emergency fund into crypto; I'm not doing anything with it unless I can find something that very clearly meshes with the point of the emergency fund :)