the Bank: Financial Tip of the Week

Savings should not be a curse word in your vocabulary. Especially in this time, savings is very important to anyone's portfolio. Here is my first Financial Tip:

If you are saving more in your 401K than you are in your personal savings, STOP or lessen your contributions to your 401K immediately. Your 401K "nest egg" should not have more money going to it than your personal savings. Rule of thumb; match each 401K contribution with an equal or greater amount to your savings on a per paycheck basis. For example, if you are putting 8% into your 401K each check, then you need to put 8% into your savings account each check as well. If you can't do that, than you either have to reduce your retirement contributions to a point where you can or stop contributing all together and put that money directly into your savings account for a period of time.

Remember this last point: 401Ks, 403Bs, SEP IRAs, have special withdrawal guidelines that could hinder you from accessing your funds in the event of an emergency. That's why your 401K and Savings accounts should be equal in value. If not, this could be a potentially fatal flaw in your financial foundation.

Don't fall in the trap like most people. Don't have thousands of dollars in your retirement account, but only a few hundred dollars in your savings account.

Thanks for reading this post and I look forward to sharing more 'Financial Tips" in the near future.

Financial Guru

Live it, Love it, Share it - OURBLOC.com