Saving Money
Course Section
Once you've opened a checking account with the right features for your daily cash flow needs, it's time to think about having a plan for saving money.
Saving is not investing. Saving money is not the same thing as investing. The purpose of saving is to have some money available at a moment's notice whenever you need it. You may save for:
- An emergency—Life is unpredictable. Your car may break down, you could lose your job, or you could have a medical emergency. Set aside enough money to cover basic living expenses for three to six months. You never know what can happen. Put this money in an account from which you can withdraw money immediately and without a penalty. Watch Mission Retirement: Life is Unpredictable to learn why preparing for the unexpected is so important when preparing for retirement.
- A purchase—You may want to buy a new stove or put away money for a down payment on a house in the near future. Savings vehicles provide a safe place for you to store up enough money to make a purchase.
