Where to Stash Your Emergency Fund

It’s common knowledge these days that everyone should have an emergency fund. Not only that, but it should be stocked with enough cash to keep you afloat for a minimum of six months in case you should come up against any immediate hardships. It’s amazing how few people plan for the worst, and when it comes around it can often have a devastating financial impact. Then there is debate on where you should keep your emergency fund stashed! Should it be in a bank account, if so, what kind? Perhaps you should invest it so it earns more interest. Or there is even a school of thought that you should freeze it in a block of ice in your freezer!

I’ve always thought the safest and most reliable place to store cash in your own personal account. A bank often yields a little interest while providing a virtually risk free environment to store your cash. It’s highly liquid, which means you can access it at the drop of a hat. This is precisely the characteristics that any emergency fund should have, after all, that’s why they call it an emergency…it’s quick and unexpected! Bank accounts are typically federally insured up to a certain amount, and most likely well above your emergency fund balance, so you don’t need to worry about losing the money to a failing bank.

There are some people out there who promote investing your emergency fund in an IRA account, or even an after-tax brokerage account. These options will certainly earn you a good deal of higher interest, but because you are investing the money they come with a much higher risk. Also, accessing funds from these types of accounts can come with fees and penalties, often making them more difficult and costly to access in case of an emergency. These accounts are a necessity in order to save for retirement, but not a vehicle in which to place your emergency funds.

Then there is the camp that is deathly afraid of even the most miniscule risk, and prefer to keep all of their cash under a mattress or in their freezer. The problem with this is that you earn zero interest, thus losing a great deal of your money to inflation. You also risk losing money to a house fire or theft. In fact, I would consider holding cash in your house as a great deal more risky than putting it into the bank.

Travel on a budget – Even more you need to know!

Who doesn’t love to go on vacation? And in this day and age who wouldn’t want to have the most relaxing and luxurious time at the minimum cost? We’ve all gotten advice on how to get the cheapest airfare, the best accommodation and finest dining at the lowest price, and how to sight-see at no cost. Here are some extra tips on how to travel in style while on a budget:

 

  1. Make nature your traveling companion – Instead of cosmopolitan destinations consider treating yourself to a stay at a national park or natural monument. A single trip to Sports Authority can be your one time investment in camping equipment that will pay dividends for years to come. Get yourself a great tent and a comfy sleeping bag, hiking and water shoes and enjoy nights by a fire under the stars and walks in clear rivers and under majestic waterfalls.

 

  1. Be a road warrior – Who says that to travel you need to have a place to stay? Trail mix was made for the trailblazers! Get yourself to the wilderness you want to explore and grab a discount rental from Fox Rent a Car. Stock up on cheap and healthy road food like nuts and dried fruit, fill the trunk with drinking water and find out who you are on the open road.

 

  1. Treasure the memories – The pace of modern life doesn’t let most of us escape as often as we would like. But with the money you save budget traveling you can treat yourself to something that will make the entire year feel like a vacation. Document your travels in photographs, then head over to Shutterfly and make them into a keepsake you can look to all year round to remind you of the amazing adventure that you had and inspire you to budget for the next one!

Aussies beat the financial crisis and start saving again

It’s taken ten long years for the repercussions of the financial crisis to stop biting at Aussie wallets. So now that many are breathing a sigh of relief, what are Aussies doing with their new disposable income? It turns out that many are taking the sensible route and investing their hard earned cash in banks, superannuation and investment properties. Gone are the days when cash is stashed under the mattress, as recent statistics show that household bank deposits are almost 1.8 trillion dollars. Similarly, superannuation contributions last year totalled around 95 billion and a record high 23% of Australians now hold investment property.

In the same period, the demand for bank loans has decreased which suggests not only are Australians investing more, but they are being more careful with their money. So why all the saving? Research from MyBudget suggests that holidays, rainy days, and big ticket items are the three top reasons to save at the start of 2015. With around half of the people surveyed saying they are saving regularly, the future is bright for Aussie savers and their families: Check out the infographic to find out more!

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