Smart to Save

August 06, 2019

It's Smart to Save; Smarter Yet to Save Strategically

Our culture has lost touch with reality when it comes to saving.  Instead of encouraging people to save first, we are encouraged to borrow as much as we can, buy with credit, borrow and spend the maximum qualified for on homes, autos, and recreational vehicles.

Borrowing to the max leaves no room for the unexpected medical bills, repairs, tax increases, et cetera. Those unexpected, unplanned-for expenses then often lead to credit card debt which becomes a deep pit when high interest is tacked on. 

I believe the smarter way to live is to build up a savings account that holds enough to pay three to six months of your living expenses and always spend less than you make.  Beyond keeping an emergency savings account funded, take advantage of retirement savings plans offered by your employer.  Make it a goal to contribute at least as much as it takes to get a full matching contribution from your employer.  Matching contributions are an additional benefit to your pay!  If you have choices of a pre-tax and after-tax plan, your financial advisor and tax advisor can help you decide which is best for you.  Beyond your emergency savings and retirement plan savings, you should look at strategic ways to save according to your goals.  If you want to help your children or grandchildren pay for higher education or post-high-school endeavors, consider funding 529 plans or UTMA accounts for them.  If you are a high-income-earner, you may also want to look at the tax benefits offered by insurance products.  I can help you work through the various levels of savings to help you meet your financial targets at every phase of your life.  


This is meant for educational purposes only.  It should not be considered investment advice, nor does it constitute a recommendation to take a particular course of action. Please consult with a financial professional regarding your personal situation prior to making any financial related decisions.  

Prior to investing in a 529 Plan investors should consider whether the investor's or designated beneficiary's home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state's qualified tuition program. Withdrawals used for qualified expenses are federally tax free. Tax treatment at the state level may vary. Please consult with your tax advisor before investing.