Loans By Kathy: Every Household Should Have a Budget - Savings

Every Household Should Have a Budget - Savings

 

Every Household Should Have a Budget.   In the Getting Started blog, you were tasked with tracking all of your expenses for a month. In the Step 2 Blog you were to look at your spending in relation to some general guidelines for how your money should be spent.  Please keep in mind that these are general guidelines.  It should be adjusted to meet the needs of each household.

Now is the time for us to discuss some specific topics about budgeting. I would first like to start with savings.  The general rule of thumb is that your savings should equal 3-6 months income.  So if you make $5000 a month, your liquid savings should equal $15,000-30,000.

Now, here is something to think about when you start saving.  Most banks are NOT offering a great deal of interest on savings accounts and in fact, if you don't have a checking account tied to the savings account, there may be monthly fees or minimum balance requirements.  Talk with your current bank, and maybe even shop around to find the best deal.  The one thing you don't want to happen is your saving account to lose money because of monthly fees. 

The other option might be a money market account, again check on minimum balances and fees.

 

For the other blogs in this series, please click on the links below:

Every Household Should Have a Budget - Getting Started

Every Household Should Have a Budget - Step 2 

 

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Kathy Sheehan Senior Loan Officer

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The opinions and general information in this blog are soley those of Kathy Sheehan.  Specifics regarding an individual case should be discussed in detail with a loan professional.  For a confidential consultation, please feel free to contact me via phone or email.  All terms and conditions are subject to change.

 

Comment balloon 7 commentsKathy Sheehan • August 15 2013 06:52PM

Comments

Kathy, Bob Stewart mentioned you in his post today... 'Kathy Sheehan was the inspiration for this post as she did a great job of breaking down just how much each household should realistically be spending.''

Posted by Margaret Rome, Baltimore Maryland, Sell Your Home With Margaret Rome ( HomeRome Realty 410-530-2400) about 5 years ago

Margaret, I didn't see that..... thanks for bringing it to my attention.  

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

It's so crazy what the banks are paying (or not paying) in interest these days!

Posted by Lawrence "Larry" & Sheila Agranoff. Cell: 631-805-4400, Long Island Condo & Home Sale Specialists (The Top Team @ Charles Rutenberg Realty 255 Executive Dr, Plainview NY 11803) about 5 years ago

Larry and Sheila, I had a client that was actually paying her bank every month for the savings account.... it is just throwing money away.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

Kathy- There are different options for saving and we each need to do the research to determine what will work work best.

Posted by Donna Foerster, Metro Denver Real Estate Agent (HomeSmart Realty Group) about 5 years ago

Kathy, I hate those fees. It seems some banks charge fees for anything so it's in your best interest to shop around. You need a bank to store your money but don't freely give it away either. You, as a consumer, have power, use it.

Posted by Phil Stevenson, CRMP, Reverse Mortgage Expert in Miami and Florida (PS Financial Services 305-791-4874 or 888-845-6630) about 5 years ago

Donna, excellent point!

Phil, I agree, I don't like paying for something when it is not necessary.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) about 5 years ago

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