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Building a savings account or investing in stocks?Help me!

Are family has started to make more money and i want to start saving money in a traditional savings. We have no debt but are cars aren't paid off and we rent, no credit card debt or outstanding loans. We have absolutely no money in a savings account. I want to start putting money into one, about 600 per month. However, my husband insists in buying stocks. He says I'm stupid for not wanting to invest when we have money, yet I want to make sure we have a solid back bone savings for if a crisis hits or we have a rainy day. Any thoughts? I'm super worried about my husband gambling all are money away in the stock market.

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Anonymous

Asked by Anonymous at 8:00 PM on Mar. 7, 2011 in Money & Work

Answers (9)
  • I'm a saver and I believe you should never tie up your emergency $. Decided on a certain emergency saving amount you need then when that is reached I'd let him invest $200 a month but save the other $400 in savings. You both compromise....
    lillie70

    Answer by lillie70 at 8:05 PM on Mar. 7, 2011

  • You can never go wrong with a savings. If you are making enough consider both but for me I would prefer a high yield savings account.. less risk.
    KayGia0704

    Answer by KayGia0704 at 8:06 PM on Mar. 7, 2011

  • I would save 6 months of expenses in your saving account and then invest.

    JeremysMom

    Answer by JeremysMom at 8:07 PM on Mar. 7, 2011

  • I'd put the majority in a savings account and if hubby wants to put some in stocks, agree on an amount that he can use in that way. I hope he either knows what he's doing or has a very good, VERY reputable broker. Keep in mind that while money can be made in the stock market, it something happens and it crashes like it did not to long ago, everything can be wiped out completely and/or you could end up owing..(not sure how one ends up owing but I have heard of it)
    meriana

    Answer by meriana at 8:09 PM on Mar. 7, 2011

  • While you are taking the time to educate yourself on stocks, keep your money in money market accounts.
    rkoloms

    Answer by rkoloms at 8:51 PM on Mar. 7, 2011

  • Definitely put your $ into a savings account and build up a reserve (8 months worth) of living expenses. With today's economy, you need to have at least that much in an emergency fund before you consider putting your dollars anywhere else.
    Anonymous

    Answer by Anonymous at 6:32 AM on Mar. 8, 2011

  • I say split it. Get an ING account for savings and you can also open an investment account with them. You can have the money go directly from your checking to that account . Check it out.
    ING.com
    or

    http://home.ingdirect.com/products/products.asp?s=OrangeSavingsAccount
    itsmesteph11

    Answer by itsmesteph11 at 9:56 AM on Mar. 8, 2011

  • You might want to do a bit of both. While you can make a lot of money investing in stocks, you can also lose a lot of money. And any money invested in stocks isn't easily accessable in an emergency, the way money in a savings account would be.
    HotMama330

    Answer by HotMama330 at 11:43 AM on Mar. 8, 2011

  • Both of you are right- you should save an emergency fund (in a savings account, or a money market account) and you should invest- though probably in mutual funds and not in single stocks.

    If you put all your extra money into the stock market- and something were to happen- job loss, job relocation, unexpected pregnancy, medical bills, car breaking down- anything like that- then you'd have to cash out your stocks (or a mutual fund) which is a super bad idea. The sad thing is, a lot of people find that they can buy stocks when the economy is well, (buying at a high price) but when the economy is down then a lot of people find that they have to cash out.

    The emergency fund is not there to make you money- it's there to save you money. It keeps you from cashing out on your investments when the market is down, and it keeps you from using your credit cards.

    Good luck!
    Erica_Smerica

    Answer by Erica_Smerica at 5:06 PM on Mar. 8, 2011

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