So, I set some goals at the beginning of the year, one being that I would get out of debt and learn to better manage my money and expenses. I have not yet reached this goal because, if you read my last blog The danger in thinking “I can pay it off later” you would know my story; however, going hand-in-hand with being financially stable and money smart would be that of investing. In my goals for the year I have also came to the conclusion that I need to put some money away; whether it be for emergencies or just for a “good opportunity” that comes down the road later on and what better way than to put it in safe keeping where it can accumulate interest AND give you the ability to take it out anytime. Of course there could be a small fee that applies when removing it before the specific time period is over.

At the start of the year as I was reviewing my financial status and where I see it headed, I realized that I have completely failed to prepare myself for unexpected circumstances that could occur. A major problem I see in families today is that they don’t have some stashed cash to help them get out of a pickle if they happen to get in one. It’s not too hard to stash some cash if you have the knowledge. Here are a few easy ways that can help:

• I have been doing a little research on CD’s and what the best possible solution would be to put money in as a way to invest. Here is a quick fact for you to remember all your life: Banks are bad when it comes to investing; especially nation-wide or well known banks. Interest rates tend to be lower than credit unions when investing your money in a certificate of deposit. Look at the comparison below that I have put together of interest rates between banks and credit unions in my local area.

• Take some liquid money out of your paycheck each time your get paid. What I mean by liquid money is tangible money—money that you can stick in a safe place within our house (or wherever is safe) where you won’t dive into it. Once you have accumulated enough to put in an investment plan (because they usually require a minimum) such as a mutual fund or CD, DO IT! The sooner the better—you will want to accumulate interest on that money as soon as possible to give you a little something extra. If you don’t have a high income and can’t afford to put much away each paycheck, start out with just $5 per paycheck or an amount that you can afford.

• If you are working with a company that offers retirement plans, by all means you better take it! These are great ways for you to prepare for the future AND often they are tax deferred. You don’t have to worry about a thing because the money is automatically taken out of your paycheck and put into the fund before you even receive your paycheck. It’s a no-hassle way to invest.

Investing your money in a certificate of deposit is a great way for starters to learn how to invest. It is a small investment opportunity with low-risks. I would suggest that you get out of debt before anything else; but if you are in debt up to your ears and will take a very long time to get out, I would probably suggest that you put some money away so that you don’t have to keep digging yourself even more into debt when unexpected circumstances occur.

This entry was posted on Tuesday, May 2nd, 2006 at 5:41 pm and is filed under Credit. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.