Tag Archives: savings

Learn to be uncomfortable, because it doesn’t get easier

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Ok, so the title isn’t super optimistic, but if you’re a regular reader you know I sometimes like to venture onto darker topics, like that time I shared that planning is somewhat futile because something will inevitably go wrong. Now I need to make a similar confession about my tendency to catastrophize life: I worry about people that think they will be able to save “later”. I think this might be most people, it’s certainly most university students. They’re going to save after they graduate, after they find a job, after they get promoted, whatever. They make a lot of excuses — but they’re perfectly valid excuses because money IS tight! Also, I think when you’re a student and you have no income, you think about money differently. It’s time for me to share a secret: I saved my student loans. I did. When I received my student loan money, I […]

How to buy big

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I was talking about credit cards with some friends, when one of them remarked that he agreed it was important to never spend more on credit than you could afford to pay off — except for big purchases, like a vacation or a computer. I asked why those were the exception and his reply was: “What else am I going to do? Just save up $1800?” Well.. yeah. I really don’t think it’s a different process to buy an $1800 object than it is to buy an $18 one, the former just requires you work longer. I think the problem with credit is that it’s made instant gratification so accessible, we justify using it to buy things that we’d otherwise have to wait for. This is really bad because things are more expensive when you buy them in credit. They’re actually more expensive twice over: first, because of the interest […]

Why your emergency fund needs to be smaller — and larger — than you think

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I love having an emergency fund. While I hate ever needing to use it, it has gotten me out of an unexpected financial bind on more than one occasion. An emergency fund is there to cover blips when things don’t go as planned: car repairs, emergency dental or medical bills, etc. It can also function to tide you over and pay your regular bills for months if you find yourself unable to work or terminated from your job. It is NOT to cover the times you accidentally spend $400 at the mall and an emergency fund is NOT a credit card or line of credit. There’s a lot of articles online musing about how big or small your emergency fund should be, and which one I agree with usually depends what money-mood I’m in. The reasons you may be able to get by with a small emergency fund are: You […]

The merits of a simple savings account

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When I tweeted that ING raised their interest rates on some of their basic savings accounts for the New Year, some of my friends balked at the meager returns. I was a bit surprised — maybe just because I was kind of excited about the gain and here my friends were raining on my parade. It’s been brought to my attention by the “that’s it??” responses that maybe one of the biggest reason my peers don’t make use of savings accounts is they don’t actually know how useful they can be. About the rates… A good savings account will pay a percent interest that mirrors inflation. It is important to understand that interest rates are low right now because the market is down. In the past, they were much higher because the financial world wasn’t reeling from a near-fatal blow like it is now. As the market recovers, rates will […]

A no-spend January

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First of all, Merry Christmas! I know it’s Christmas Eve, but thanks to my German heritage, that means I’ll get to open most of my presents this evening :) I’m very excited to give and to get! In other news, I’m planning a no-spend month. I think it’s important, and post-Christmas will get me the least amount of criticism because everyone else will be dealing with their credit card hangovers and assume I’m in the same boat. I need a no spend month for a number of reasons. First, I need to see of my emergency fund is actually realistic. Can I really live off less than $900 per month? Secondly, it’s good to break the cycle of how accustomed I’ve become to getting everything I want. Humans are adaptable creatures, and my income jump from undergrad has gone from feeling privileged to commonplace. It’s time I return briefly to […]