Entries Tagged 'Savings' ↓

How much money do you save? How much do you live on? Give away? Have you ever thought about it?

How about the 10/10/80 plan. You might have heard of this the other way around, 80/10/10. This is where you spend 80% of your paycheck on bills and living expenses, 10% goes into savings, and 10% is given away. I, however, prefer to look at it my way… in order of importance. Continue reading →

Back a few posts ago we talked about where to keep your savings. CDs were mentioned as a good place to store funds that you don’t have an immediate need for yet that you can’t afford to take the risk of losing in the stock market. I am sure the minds of some of you out there jumped right to… “that sounds like a good place to store my emergency fund”.

And it is, with one catch: the length of time CDs tie up your cash. A 5 year CD – which normally has the best interest rate- is impractical. After all, an emergency fund is supposed to be there in case of emergencies. If your money is tied up for 5 years it won’t be available for emergencies.
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Emergency Funds! It seems like everywhere I turn these days I see another post about emergency funds. Finance blogs and websites talk about them, they give advice for creating them, and they discuss how best to keep them. They really are the ‘IN’ thing to have and talk about.

… Of course, this is for good reason.

Here is a quick What, Why, and How followed by all the information you could ever need.

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Savings accounts traditionally do not have the best returns. Stocks are risky. Bonds and CDs can tie up your money for months or even years. This presents a dilemma for storing your savings. Do you keep it liquid and make so little in interest that it doesn’t even keep up with inflation –which effectively looses you money. Do you place it in Bonds or CDs and pray that you won’t need access to it any time soon. Or, do you risk your life savings in the stock market.
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