We are a commune of inquiring, skeptical, politically centrist, capitalist, anglophile, traditionalist New England Yankee humans, humanoids, and animals with many interests beyond and above politics. Each of us has had a high-school education (or GED), but all had ADD so didn't pay attention very well, especially the dogs. Each one of us does "try my best to be just like I am," and none of us enjoys working for others, including for Maggie, from whom we receive neither a nickel nor a dime. Freedom from nags, cranks, government, do-gooders, control-freaks and idiots is all that we ask for.
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Thursday, July 31. 2014
If you have some savings (which most responsible people sacrifice comforts and luxuries to have), what do you do with it? Investing how? Or not investing?
- Short-term savings (might possibly need within a year or three)
- Long-term (might need someday, or might wish to leave to kids if you croak soon enough)
Inquiring people want to know what you do with your money. If I get some comments, I'll show you mine.
Posted by The Barrister in The Culture, "Culture," Pop Culture and Recreation at 14:07 | Comments (28) | Trackbacks (0)
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We have several savings accounts.
1. Long term (several months in case of need due to unexpected circumstances). This is the largest one.
2. Short term (items which are potentially desirable but require some funding due to high cost).
3. Vacation (you always need a little extra when you hit the road)
Used to have a College account for the boys. That got burned out during an extended bout of unemployment.
Checking account - $$ to cover incoming, regular bills, for roughly 90 days
Savings account - $$ to deal with larger purchases or non-ordinary bills over roughly 6 months
Investments - $$ that don't get touched, hopefully, until such time as we "retire" - its purpose is future income when earning days have dwindled and no longer support the lifestyle we perfer. The kids get it if we die. Some of this is in the form of IRAs and 401Ks that can be borrowed against at quite favorable terms.
The bulk of savings (90%ish) is in the last category which is also the highest deposit/growth category. The trick with that $$ is to not consume it too early or live too long. Living too long I'm not all that worried about for me as I don't come from a long line of the long-lived. I'm concerned about it for My Darlin' cause she does. Mind you, I ain't gonna eat catfood casserole in my impending old age to mitigate that concern.
Whats the point of this?
Historically, I have tended to invest in conservative blue chip growth stocks like Enron and General Motors.
1 - LongTerm - 'Pearl Harbour' events, new car, ect
2 - ShortTerm - Vacations, stuff needed near-term
3 - checking account - day/day
Also have some 'hard savings' - i.e. gold, silver, ect - not as much as I would like, but 'just in case'...
Plus, plenty of ammo... you can never have too much ammo...
ST: We have a savings account linked to our checking account. Rotten interest but easy to transfer funds between accounts. We try to keep six months worth of income equivalent in this account. We also have a MM account w/ a major fund manager-. This acts primarily as a sweep acct for our accounts with that firm, but has check writing capabilities and is where we turn for largish checks (tax, home repair, etc.)
LT: Kids are out of college so main purpose is retirement savings, a little income (one of us retired a few years ago, but the other hasn't yet), and emergencies. We hold our fixed income savings in funds at a different fund manager, and in tax-protected form. We hold most of our variable price products (stock mutual funds and now ETFs), in funds at the same fund manager as our MM account. Most of our LT holdings are in index funds. One fund that isn't is for historical reasons at another fund manager. It has lots of capital gains but would probably be our go to fund if we needed suddenlly to go beyond what we have in our ST accounts.
I have spent a huge amount of my savings recently in order to remodel my house and get me by between jobs. I'd rather spend my money while it still has some value. Because the dollar will be worth next to zilch quite soon.
I have no cash saved. What is the point of parking cash at near 0% rates when inflation is running 7-8%/yr?
I have money borrowed. Good chance I will be paying that off with Monopoly money, when inflation hits high gear.
Well, ok, I will tell you.
My largest asset is the homestead on which I have kept a large mortgage on advice of accountant.
For shorter term money, I use Vanguard int-term bond fund.
For long term, I use Vanguard balanced fund and Vanguard dividend fund.
Occasionally, I get a hot stock tip and it never works out.
If you mean savings as versus retirement accounts and investments, we keep several months of expenses in several small accounts at different banks and S&Ls.
The reason for the multiple accounts is that the plans to seize portions of bank deposits to bail out insolvent banks (and essentially all are already insolvent) are already in place. The same banks that are making no money down loans to unemployed illegal aliens, serial deadbeats and the clinically insane. No loans, no multimillion dollar bonuses, and we can't have that, can we?
If you doubt this, talk to the people in Cyprus, and review the approved and published plans for the EU. And if by some chance you think Obama, Reid, Pelosi, Boehner and McConnell are any better than the theives in Europe (or better than Putin, for that matter), you probably deserve to lose your money.
We have the worst government in our history. Other countries are in much the same shape, saved from "worst" only by some truly awful predescessors. We really should be worrying about another World War.
A savings account we put into every week.
A boat fund wife started for me 5 yrs ago for a B-Day gift with money deposited every week.
A checking account
A simple IRA
A Traditional IRA
Two Roth IRA's
Some vacant acerage paid off, with low tax to sell if needed and some cash put away
and our House
My 401k evaluator said I was 100% invested in the money market and I was appropriately diversified for my age.
Don't buy any green bananas.
We're mostly invested in real estate, which used to be a good strategy, not so much anymore. Still, we have land that we can live on and fish from if things ever go awry.
one savings at same bank
one money market at broker
90% high yield dividend stocks
rolled ira to roth several years ago.
everything paid for
don't owe anyone for anything.
life is good in spite of stupid democrats.
My primary goal was to get out of and stay out of debt. That I've accomplished. I live in earthquake country, so I've always planned to have enough stored food/water etc. to tide me over any disaster-related period of instability. I've expanded this to be able to survive longer. The big problem is I live in an area (voted 73% for Obama) in 2012, so there are few allies out there. I live where I live to provide support for elderly parents. If the SHTF, I don't have anywhere to go. I have cash at home to cover expenses when the ATMs don't work (for a while, anyway). No precious metals. Most money invested in index funds, mutual funds, cash, and bonds. Typical diversified portfolio that most money managers recommend. It's going to get ugly.
I had a great savings account until I lost my last two jobs. I have been unemployed for the last 2 and a half years. Now I am taking from my retirement account (just enough to pay bills) and consider myself officially retired, ten years earlier than I planned. I have no debt other than my mortgage. But if I need a new car that will take more.
My dreams for travel in my golden years have been shattered.
Pity we can't know the future. Good idea to save for the missus, bad idea to shortchange today to do it.
My wife was younger, and took better care of herself a stroke in 1992 notwithstanding. Knowing that she couldn't work I put in long hours, worked weekends and took minimal vacations to leave her plenty of money. She passed away three years ago and I'd gladly give most of the saving up to have spent more time with her.
Word to the wise from a fool.
Once a year we liquidate enough of our retirement savings to cover estimated living expenses for a year, and leave it in the bank. Otherwise everything's in a diversified mix of bonds and stocks, not counting the homestead. Very gradually over the years we'll adjust the mix of bonds and stocks to reflect our age.
Best plan: Work as long as you can. Keeps your brain going and keeps you useful. Feeling useless is the worst thing in life.
I invest in pints of beer. You can't take it with you, enjoy yourself.
Totally agree. I'm 71 and my regret is working long hours and studying/working at home. Don't get me wrong I have a good relationship with my adult children and family was great when they were young but I could have done so much more. Your children and other family are gifts with an expiration date. If I had really understood how quickly the years pass by while you are busy living life I would have spent more time being a dad and a husband and less time on things that just don't seem as important today.
I retired at 60 with two pensions(Army and teacher). I'm having a ball. Much to do around the house and miles to cover on the scoot. Took Soc Sec at 62' as my accountant urged and most all of my peers are doing. What are you waiting for? My body has taken a beating and the friends of my youth are dead. The only folks I hear urging us to slave until death are those who have jobs that do not wear you out physically or mentally, and have a bit of money.
I agree. Keep some of your assets/money liquid so you can get too it easy. Keep some or more then "some" in PMs. Maggies Farm keeps talking about math and statistics in school and how important it is; well do the math. We are broke/bankrupt, we are borrowing enormous amounts of money and printing enormous amounts of money to stave off the bankruptcy. Our politicians are committed to spending even more and expanding the size of our government. Our social infrastructure and self sufficiency level is far worse then it was in 1929 and another 1929 crash is coming. We are one significant event, one black swan away from a disastrous economic crash far worse the 1929 was. Our government is clearly gearing up for some kind of civil unrest so I think they are fully aware that it's all going to come down on our heads. I think our crash will more closely model Argentina's crash and not what Europe is going through. I also think that what we see in Europe today is not their economic collapse but rather their version of "economic easing". They will collapse as well when we do if not before.
Money in checking for current month's bills, zero in savings. What wealth I have is where no one else can see it or take it. I took the hit and cashed out the only retirement annuity I had last year. I too have been paying attention to the behavior of the Europeans, and it is not lost on me the generation ruling us yearns toward the same tyranny.
[RANGES given, not exact percentages...hence doesn't add up to 100%]
0-10% Stocks/ETFs/Mutual Funds
10-20% Precious Metals
(does not include home, free-and-clear)
One additional note:
OF the stocks and bonds,
50-70% in U.S. currency
30-50% in foreign currency of country with low Debt-to-GDP ratio
Savings are a small part of the picture. You need insurance for the big ticket things and the annoying stuff that can get expensive. Like ID theft.
Emergency funds for about 6 months of stuff is cool for most folks. Keep it in a cool dry place.
Investments are a crap shoot but pretty much the only game in town. Mutual funds. Just hope the financial crash and zombie apocolypse doesn't happen till after we all die.