Ask MetaFilter questions tagged with Money and savings

Why can't college be cheaper?

Anonymous — Mon, 30 Nov 2009 19:04:26 -0800

My 1 year old daughter has been given money... what now? I know you're not my investor or anything, and thanks in advance for any help.

Every holiday my daughter receives money from her grandparents. She's up to $600 in cash as well as savings bonds. I'm trying to do the right thing and put her money up safely for her, I'm just clueless about the best way.

I have her money in a savings account that gains .60% APY as of now.

People in my family (namely - my mom) are telling me that I should put her money into savings bonds, it's the smarter thing to do, i need to be responsible, i need to save for college, yada yada yada...

Other people are saying I should look into college savings plans.

I've looked into it myself, but I'll confess that I get a little confused trying to compare everything... What's best for my daughter?

What should we do with our money?

Tarumba — Sun, 20 Sep 2009 15:41:55 -0800

What should we do with our money? We save about $1000 a month, and I have the feeling we are being too passive with these savings. Right now we have them in a joint savings account in our Credit Union, were the interest rate is a meager 0.5%. We would like to continue being members in the credit union (we both have checking accounts, and we use them to pay for bills, etc.) There is a good possibility we will be saving more in the future, since we are VERY cheap, and we both may be promoted soon. Retirement is not a worry, we are already taking care of that.

What can we do with the $$ we are saving? Are mutual funds a good option? Do you have any recommendations as to specific banks and accounts?

Also...My boss proposed us that we pay him 50 dollars and he'll manage our money on etrade.com, but I don't know if that would be good (he does have a talent for finances)

Where to hide the money?

odi.et.amo — Sat, 19 Sep 2009 07:15:22 -0800

How can I figure out the minimum amount to keep in my checking account? Basic financial stats: I pay for everything I can (including bills) with my American Express for the cash back bonus. A few utility bills are withdrawn from my checking account, as well as rent. I pay my CC bill from checking, and my paycheck is deposited there. Income > Expenses.

My only debts are student loans (at such a low rate that I have no intentions of paying it off early), and about 4k left on a car loan that I could probably pay off now if I wanted to.

I'd like to make the most out of my savings account, though, and even though I feel like this should be easy, I can't figure out how little I need to keep in checking. Is there an easy way to figure this out? I know I can move some money to savings now, but I'd love a formula to figure out how much that should be (in addition to the money that I have automagically transferred every month).

Side question - should I put this extra money towards my car loan instead so that I can start saving even more each month? The interest rate on the car loan is between 5-6% if I recall. Online savings is with INGDirect which is somewhere around 1.4%.

I have $30,000 burning a hole in my pockets.

brenton — Thu, 02 Jul 2009 16:11:08 -0800

Where is the best place to put my $30,000 as I slowly withdraw from it over the next 2 years to pay for Grad School. As of today, I saved exactly $30,000. I will quit my job in a month, and I'm starting classes in the Fall. I won't have any other source of income for two years, besides school loans and these savings.

I currently have them in a WAMU Online Savings account, which was paying 4% interest before, but now is paying next to nothing.

What to do with £5k?

like_neon — Wed, 18 Feb 2009 03:20:18 -0800

What to do with £5,000 in the next year? I know in investment terms £5k is not that much, but it's a lot to me! It feels like it's just lying around (in a 3% savings account) and am wondering if it could be put to better use.

Some things I've considered:
- Leave it as is and be happy there's an emergency fund given the current economic climate.

- I'm engaged! (yay!) and we are thinking the wedding will be next summer. Should I just use the £5k towards the wedding instead? We haven't started saving anything towards it yet.

- Invest somewhere else?

- Something else?

Our situation:
- We are already saving money on a monthly basis which we intend to put towards buying a house in the future. Now this will somehow need to be adjusted to save for a wedding.

- My fiance and I both currently hold jobs and bills are not a problem (touch wood).

- As of recently, neither of us have any debts (yay!)

This is just a lump sum I don't know what to do with right now and I guess it's burning a hole in my pocket. Thanks for your advice!

Best way to save a nest egg for my kiddy in the UK

steve3001 — Sun, 08 Feb 2009 01:16:14 -0800

Hi. I live in the UK and have a 3 month old baby boy. I have just started saving into a child trust fund but am trying to figure out if this is the best way to save some money for his future. I would like to generate a lump of cash for him when he is 16-18 (for Uni or whatever needs paying for then), would prefer to do it ethically, and am not sure what the best value way of doing this is. More details available if needed but gotta go ... he's waking up! Thanks in advance!!!

oh my should I put my money in a mattress?

borkingchikapa — Mon, 15 Dec 2008 07:29:53 -0800

I'm moving overseas from the US in less than a year, and my stellar powers of observation tell me that there's a good chance the dollar is going to eat shit before then. My savings are <$10,000, what can I do with them to ensure that I'm not cursing the economy when I leave? Is putting it in foreign currency enough, or is there a better option? How do I do that? I know we're probably not talking about anything catastrophic here (though maybe!), but I've had the dollar devalue on me before and it sucks even when it's a fraction of a percent. I have everything in a money market account now, which I like because I'm earning some interest but all of my money is still easily accessible. I'm not looking for some long-term investment solution, I just want to make sure I have roughly the same amount of money I put in there at the end of next year.

How can I afford to build an "emergency fund" ?

swiffa — Wed, 19 Nov 2008 23:41:29 -0800

How does one "put aside" x months of expenses for emergencies? Not pay expenses for x months? I often hear this advice (which I think is great) but putting it into reality is driving me mad.
For example: I make $18,000 year net and want to put aside $ 9,000 or 6 months living expenses (living practically check to check). If I put 1/2 of my check aside (impossible with expenses) it would take a year. At a more reasonable rate of 1/8 of my check ... 4 years?

Seems like by the time you have it put aside an emergency quite likely will have already happened (like a job loss). Any thoughts?(besides not sleep and work until health is lost) :)

Paying Off Debt v. Safety-Net Savings (Given the New Circumstances)

WCityMike — Mon, 13 Oct 2008 09:53:06 -0800

Traditional wisdom suggests that saving money while in debt is a bad idea: you pay hundreds of times more in finance charges on money you owe than you would get in interest on money you save. Under this scenario, your "safety net", at least until you are debt-free, would be the credit lines you are clearing out. However, in a response to a Lifehacker comment I made outlining this traditional wisdom, someone replied that given the financial crisis, companies could then lower your credit limit, regardless of cause, killing your safety net. Given this, is the traditional wisdom now wrong? Over the months to come, is the wisest place for any money remaining after bills an interest-earning savings account, or still towards reducing my credit card balance? If a mixture of the two, what ratio would you yourself recommend? Finally, what would you yourself consider a minimum balance to reach for your safety net, if you felt the traditional answer of six months' salary was, for now, too high a goal to be practically reached?

Not panicking, just refining my strategy.

ourobouros — Thu, 02 Oct 2008 14:14:50 -0800

Given the current economic climate, should I be padding my emergency fund or paying off my credit cards? For the past year, I've been aggressively paying down my credit card debt. At the beginning of the year, I had several credit cards, all carrying a near-maximum balance. Now, I've completely paid off the card with the highest interest rate, and I'm within striking distance of paying off the whole thing. Yay! I estimate that within 4 months, I'll be credit-card-free.

In the meantime, I've been making very small but steady payments into an emergency fund. This fund is now large enough to cover about a month of living expenses.

I haven't been too worried about the economic crisis so far, because I don't really have enough money to be directly affected. But I work for a small business -- exactly the kind of business that might be harmed by the credit crunch. As far as I know, my employer is doing just fine, but I'm a little worried about what might happen in the months to come. Because of this, I've been considering temporarily switching back to minimum payments on my credit cards so that I can build up my emergency fund to a more comfortable level -- maybe 3-4 months' worth. Is this a good idea?

A couple of other factors to consider:

- In addition to the credit card debt, I have subsidized student loans, which I've just been paying minimums on. I figure I'll be paying these off for the next few years, but the interest rates are so low that I don't mind.
- I also have an "irregular expenses" fund that holds enough for things like doctor's appointments, car repairs, etc. So my emergency fund is strictly for emergencies.

So, what do you think? Given these conditions, should I be putting more into my emergency fund? If the economy goes "plop" and takes my job with it, will I be better off with more cash on hand, or will I be regretting not paying off my credit cards when I had the chance?

Thanks, all.

Alternatives to super when the economy isn't doing so great?

wingless_angel — Mon, 28 Jul 2008 09:23:48 -0800

What should I do in addition to super to have any hope of retiring several decades from now? So according to the Sydney Morning Herald superannuation returns in Australia are way down . I've long been sceptical of being forced to put so much into super since it is more volatile than we've been led to believe. I'm wondering what alternatives there are.

I'm 30, work in the government, I have two different government super schemes. I'm currently contributing 8.5% of my pretax income along with my employer's 17%. I am in a defined benefit fund which I think will screw me in the long run. I have no assets but am saving for an apartment downpayment.

I would like to live overseas for a year on and off here and there, and maybe have kids and this is going to put all kinds of breaks into my contributions. And I'm also wondering, what else shoud I be saving up for to contribute to especially with the economy the way it is. What are the alternatives to super? Should I be watching for the market to bottom out and buying index funds? Buy into property? Put cash into online savings accounts?

I do want to retire someday, and I'm really not sure that super is going to cut it.

Where do you put money for baby?

ND¢ — Mon, 28 Jul 2008 08:04:05 -0800

So, we just had a baby and grandmothers keep coming up to us and handing us checks for $50 and saying "This is so you can buy a savings bond for the baby." However, I would like to hear about alternative saving/investing ideas for my daughter. I know 529s are the hot new thing, but I hate that it can only be used for college. What if she decides not to go to college or needs the money sooner for whatever reason? Is there a good way to invest the money that keeps it in our name until a certain date and then it goes to her and has more flexibility than a 529? I am not sure that tax liability is a major concern since we are talking about like $400 right now, but we would like to set aside a regular amount ourselves and there will be birthday gifts and whatnot to add to it.

Having reviewed the older questions on this topic, I feel compelled to list some advice I am not looking for: "buy gold because the grid is coming down man!", "my parents didn't give me any money and I turned out fine so your baby don't need none either", "don't ask people on the internet, go see a financial planner right now" and generally anything crazy.

Also, I can be convinced that a 529 would be the best way to go, but I would probably need state specific information. We are in South Carolina.

Thanks in advance everybody!

Why can't I close out and withdraw from my 401k? Any way out?

Anonymous — Mon, 09 Jun 2008 19:02:16 -0800

I want to close out my 401k (and pay the necessary taxes) so I can pay off some debt. My 401k says I'm not allowed. Why not? Can I change anyone's mind? I have relatively minor credit card debt n. I have meager 401k savings n. (I am only 23). I would like to pay off my credit card, and be putting the money I'm currently putting toward monthly credit card payments toward more immediately accessible savings. Additionally, my company has as of last month decided to start matching 401k contributions, so I'd rather be putting matched money in than letting the $n sit there doing not much in the stock market while I continue to accrue credit card interest. However, I can't put money in until I'm not worried about paying off credit cards.

So I called my 401k people (Fidelity) to ask to take the withdrawal. They said I can't. I said, are you seriously telling me I can't have my money? And they said that since I'm still at my current company, I can't do anything with it until I'm fired or leave voluntarily. I've got a while before I'm planning on either of those. What the hell? It's my money, isn't it? We wants it :(

The other option is to take out a loan, but I'm only eligible to take out loan n/2, and paying back loan + interest plus paying off the other half of credit card debt won't really solve my problem. My goal is to wipe out the debt, be able to start contributing small (matched) amounts to retirement, and separately do a better job of keeping an accessible savings account with monthly contributions.

So, question 1: Why can't I take out my money? What's the reason behind this? And is it likely that by arguing in a different way I could get it? I'm fully aware of and willing to pay the necessary taxes if they'll just let me get at the money.

Question 2: Any other options for what I'm trying to do?

(Anonymous because I don't want this connected to the real name I use on here)

Please help me decide between Fidelity and Vanguard.

salvia — Sun, 06 Apr 2008 16:37:09 -0800

Questions about opening a Roth IRA -- particularly, does it matter where I open it? If so, Fidelity vs. Vanguard? I want to open my first Roth IRA. I've read past questions and some online resources, but I still have some questions.

- First, does it even matter where I open it? If I figure out I screwed up, how hard is it to switch from one of these to the other?

- I will (very soon) have a 403b with Vanguard through my employer. Does that tilt things in favor of Vanguard for an IRA? Would I be able to "pool" these funds? It sounds nice to make one phone call rather than two. But is there some reason that tilts things in favor of Fidelity? Would it be better to have them both as options? Then I could hold, say, some of both group's target retirement funds.

- To make a good decision, do I need to figure out where I would invest the money first? They have different expense ratios even for their S&P 500 index funds (VFINX is .15% vs. FSMKX is .10%). I realize this isn't much of a difference, but if they differ on the simplest index fund, they're going to differ by more in other things, right? (I'd be deciding between S&P 500 index funds, some index fund with non-US companies, or a target-date retirement fund.)

- If you do think I should decide where to put the money first by actually looking at fees, how do I find that out? There are these scare stories (eg) about hidden fees. Are they still hidden if I look at Morningstar's front load %, back load %, and expense ratio? Or is there a better place to find all this out?

- All over the web people are saying that Fidelity's customer service is better and more informed. This has me leaning toward Fidelity. Do you think this still holds true?

- Lastly, what does this comment from jak68 mean, "Also -- in case you didnt know -- there is a small difference between buying funds via a trading account at a brokerage house (as with fidelity, schwab, ameritrade etc), VS. buying the fund directly from the fund family's website (vanguard, etc)?" Should this influence me in some way?

Thanks for your help. I'm interested in learning more over the long term, but I also have the feeling that I'm making this too complicated and should find a way to make this simple.

Did the ant and the grasshopper both retire comfortably?

chickletworks — Tue, 19 Feb 2008 00:21:08 -0800

At what age did you start saving for retirement? At what age do you recommend starting to save for retirement? I know that the smart, responsible answer is "As soon as possible," but guess I'm asking whether you can put it off for a while and still be okay-- and whether average people do.

I'll talk with a financial planner, but I wanted to get a sense of how other people have made retirement savings decisions. Thanks in advance!

FX gives me a headache

barrakuda — Fri, 15 Feb 2008 06:46:02 -0800

I am permanently moving from the US to Europe in about a month. I have about $50K in savings in HSBC high (and ever-falling) interest account. I am at a loss as to what to do with this money. Money-savvy Mefites, please come to the rescue. So I have all this money sitting in savings. For the next four months my salary will continue to be paid in dollars. I am a horrible, albeit charming, investment ignoramus. On one hand, I feel terrible about converting my savings to euros, on the other I don't know whether I want to leave my money in the States especially if the dollar is to further depreciate against the euro. I considered buying an apartment in Washington, DC and renting it out; but I wonder if there are other means of managing my hard-earned money and assuring that it will not loose its value. Ideas? Comments? Anyone? Bueller?

Recommendations for a financial advisor/accountant for a young couple?

scazza — Wed, 30 Jan 2008 13:51:24 -0800

Recommendations for a financial advisor/accountant for a young couple in NYC? We've read a lot about finances, but I would like to sit down with a person. I'd prefer someone who can do it all; to slog through all of our financial life, to ask questions of, to plan, to do taxes, not just someone interested in investing. I don't know if it should be someone who specialises in freelancers (arts and computing) if there is such a thing, and I think I'm looking for someone independent because I don't want to worry about prejudiced advice.

We both have irregular careers: his as a specialized-but-underpaid programmer doing both freelance work and a day job that changes every couple of years; hers currently studying but eventually working in a performing art that involves lots of travel and work accomodation (apartments) paid out of pocket (but tax-deductible) and pay on a performance-only basis.

With this in mind, we have no idea how to achieve our goals. We are relatively good at our basic budgeting and financial management but need help with saving for retirement (IRA) and a baby someday, managing his 401K (503b), improving credit, buying a home as soon as practicable (we feel like we're throwing money away on NYC rent), affording travel to stay close to family on three coasts of the US, plus the UK and NZ, and very necessary vacations. A wedding would be nice too but it seems too complicated already.

Thanks!

What to do with all that money?

Anonymous — Mon, 14 Jan 2008 15:41:00 -0800

I will soon receive an inheritance of about $100,000-$150,000 (numbers are vague right now). I'm looking for tips and advice for managing that money. I have talked with a financial advisor from one of the major firms about this and they would be happy to help me with my money at the rate of 4.5% per year. Frankly, I view that as extortionary. I even remember once hearing advice that said to not pay more than 1% in fees. This sounds reasonable to me. My current IRAs and other means of saving that do charge, charge less than 1%. I doubt it's 1/5th of a percent. I'm pretty sharp and generally good with money. I think that with the right research, and proper dedication, I can manage this money myself and save scads of fees.

Ideas so far:
1. I have a small amount of debt that I want to pay off immediately. Less than 10K.
2. I have a 13-year-old daughter for whom I want to sock aside somewhere between 20-30K for college. This is very important to me.
3. My mortgage is split 80/15 (the 15 being about $23K). I am toying with the idea of paying off the 15%. The interest on that portion is 8.25%.

For what it's worth, I am a late-thirties male with decent (not great) income and a proven ability to live frugally when I set my mind to it. I have no car payment. Only regular payments are child support, house, utilities, subscriptions etc. Currently, I am paying towards that small amount of debt on a monthly basis.

I need help on figuring out how to manage the rest of the money and my future money since I will ideally be out of debt aside from the mortgage. So, pointers, advice, tips, reading material, ideas, what have you?

email can be sent to AnonyMeFimomoney (at) sbcglobal.net

What do I do with a big check?

Anonymous — Mon, 07 Jan 2008 23:44:19 -0800

I'm about to receive $40,000. How do I deal with this much money? I'm about to get $40,000 as part of a divorce settlement from the sale of real estate (frankly, I'd rather have stayed married but that is not to be.) Can I just deposit it in my savings account or do I need to do something special? I may need to spend most or all of it in the near future: while I have it is there something very safe I can put it and "earn" interest while still being able to take it out?

I need help repaying a personal debt.

Anonymous — Fri, 04 Jan 2008 19:10:23 -0800

I've owed someone some money for many years. I keep forgetting to repay it and then I remember later. Repeat cycle ad infinitum for almost 18 years. Help me figure out how to repay it. It was originally a small sum: $160.00. I owe this to the family of a high school friend that helped me out in 1990. They let me live in their basement for $80 month plus household labor. At the time I was broke. Flat fucking broke. In October of 1990 I moved in with my girlfriend and her parents and paid rent there by doing household and automotive labor. I still owed them $160.00 when I moved out. Well, here I am years later feeling a little guilty for not having repaid that debt to my friend's parents. So here's that time of year when we find ourselves wanting to be better people...

How should I repay it? I feel it only right to give them some sort of interest, or return on their money. It is after all, money that could have earned interest in a savings account, CD, TBills or in the stock market. Can you give me ideas as to what standard (Stock Market, TBills, CD, Savings accounts) I should use for repaying this and info on where I can find these historical numbers?

Any other thoughts or ideas are quite welcome.

Saving money in euros...

Afroblanco — Fri, 02 Nov 2007 11:49:23 -0800

I keep all my savings in a Citibank e-savings account, which is like a regular savings account, only with a higher interest rate. Recently, the dollar has totally been tanking, and this trend doesn't show any signs of reversing. What's the easiest, safest, most profitable way for me to save my money in euros instead of dollars? This is what I like about the e-savings account :

1) My money is FDIC insured.
2) The interest rate is higher than that of a typical savings account. It's somewhere around 4.25%.
3) I can take my money out any time I want without incurring any kind of penalty.
4) It's ultra-low-maintenance - I can just put my money in and forget about it.

I would like to put my money in euros without sacrificing any of the above, if possible. I know that I won't be able to find something that's FDIC insured, but I would like something that has a similar degree of security.

The fact of the matter is that the dollar is totally tanking, and I don't want to see my life's savings evaporate because of inflation or anything else that I don't really understand.

Is there a set-it-and-forget-it way to invest?

Anonymous — Mon, 03 Sep 2007 20:09:53 -0800

I've got about $3,000 per month to invest, and I don't have time, knowledge, or energy to "beat the market". What's my best safe bet? I've done loads of research on all the dummies-level investment info and I've come to the conclusion I should probably invest in some index funds. I've got an account at Vanguard but they offer a zillion different funds. Is there a general risk level I should take (like 80% stock/20% bonds that people often toss around)?

I'm already maxing out my retirement, my credit cards are all paid off, and my house is my only debt. I'm doing well at work and want to do more than simply toss it into a 2% savings or 4% money market checking account. Ideally, I'd like to see 10% gains year after year with this.

Aside from index fund research, I haven't done much else, so I'm a complete novice at any other sort of investing.

HSBC and Multiple Buckets

icebourg — Sat, 02 Jun 2007 19:18:31 -0800

Is there an easy way to open multiple online savings accounts with HSBC Direct? I love ING Direct's website, and one feature I particularly like is how easy they make it to have a bunch of savings accounts set up. I usually use them as short-to-medium term "buckets" that I can put in various amounts for different goals. For instance, I might have an account just for expected car repairs, and another for a piece of software I'm saving up to buy. Since I already have an account, opening a new account takes about 3 seconds and the new account gets fully integrated with the rest of my accounts. It's quite spiffy and solved a lot of the problems I've had with money management in the past. (not [easily] knowing how much I had set aside for what purpose)

Although my account was unaffected, I got spooked by ING's closing thousands of electric orange accounts and decided to try out some of the other offerings out there. So how can I replicate my ING setup with HSBC?

I went to their online savings signup page, but the options are "New Customer/Set Up Online Savings(or Online Payment)" and "Existing Customer/Online Payment." Their website seems like its set up to manage multiple accounts, so how can I set up additional online savings accounts without going through the whole application process again?

Their online payment account seems to be their answer to ING's Electric Orange account, and I'm only interested in savings accounts for now.

HSA's = tax-free retirement account?

MrBCID — Wed, 16 May 2007 17:21:06 -0800

Health Savings Accounts (HSA's) ... Can they be used as just another tax-free retirement account after you max out your Roth IRA? I usually max out my Roth IRA and contribute to a 401(k) ... I just came across this Newsweek article that got me thinking about opening an HSA.
I used to contribute to a Flexible Spending Account and understand that the money in an FSA is lost if not used within a year...
An HSA on the other hand would let me keep that money in there kind of like a Roth IRA correct?
Do I have to be enrolled in a High Deductible Health Insurance policy to be eligible?

I am 22 years old and don't need my medical insurance for anything more than a yearly check-up.

Any advice would be really helpful. Thanks in advance.

Budgeting around strange timings

sarahsynonymous — Wed, 09 May 2007 00:03:28 -0800

How do I conceptually wrap my head around a monthly budget that doesn't want to play by the rules? My money matters are fairly simple, but the timing is killing me. At the moment, my monetary issues aren't too complicated. Basically, I work a full-time job, pay rent and all those related bills, and am steadily paying off a car, student loans and very minimal (under $500) credit card loans. I've kind of been playing fast and loose with budgeting, which has miraculously worked up until now, but I want to get a firmer plan to make sure that I stay strong and can start actually saving and investing.

The things I've read about budgets seem to deal with a pretty simple monthly format: you get paid once or twice a month, bills come around once or twice a month, incidentals are sprinkled throughout. However, this isn't my case. At my work, they just changed to a payroll system that pays us once a week; I've already asked, and this can't be changed. My bills are also agonizingly spread out over the course of the month, with several hitting every week; I'm not sure how flexible those dates are, and a few of them are automatic debits anyway.

I'm having the most trouble dealing with getting paid weekly. I realize it's the exact same amount of money coming in, but when it's coming in small bursts, I can't get a handle on the bigger picture and savings and all of that. The bills are also frustrating to keep track of, because they all seem to crop up randomly. I feel like my money is always slipping away and I'm sort of on the brink each week, like I should be holding my breath every time I go to check my statement online. But I just don't know where to go from here.

So basically, does anyone have suggestions for what I should do, conceptually and/or practically? I'm considering having my paycheck directly deposited into my savings, and setting up a biweekly/monthly transfer from savings to checking to mimic a more sensible pay period, but I don't know if that'll just confuse me further. Oh, and I'm a Mac user, if that helps.

Thank you ahead of time!