I do respect your opinions and advice here BUT every option you give puts you and your viewers at risk of losing ALOT more than the rate of inflation. As of June 2019, inflation is 1.6% and ALLY bank gives 1.9% interest on their online savings acct. It would benefit you more to keep your EMERGENCY fund or “rainy day” money easily accessible in a high interest savings acct.
Totally agree , whenever you put money in the stock market you have to assume a lot of risk. That risk is not worth it for me , if you take your savings and put into an account making 3 to 4 % that is a lot safer than the stock market. Plus there is no penalties to taking your money out. If you have your 6 to 12 month emergency fund then put 1 to 3 percent of your annual income into stock market feel free. When it comes to retirement , my philosophy is to minimize risk and the stock market is risky
I totally get where you're coming from but I think the best thing about having some sort of emergency fund is the peace of mind that comes along with it. Last month my engine completely seized up and it wasn't covered under warranty (long story). So after trying to fight the dealership I'm stuck with a $6-7k bill. I wouldn't want to raid my retirement accounts for that or go into credit card debt. Thankfully I had my emergency fund to rely on.. does it suck? Absolutely. But after going through this I'll always have at least three months of expenses saved up.
Alex Beaulieu totally get it! To each their own. Not trying to point fingers or say one way is right or wrong. Just trying to share some perspective. Sorry to hear about your truck too. Best of luck.
Great video! I can see how this would work for people. It makes me twitchy not to have an emergency fund at all but I’ve got a strong need for security and safety. Good thing personal finance is personal and different things work for different people! Great to meet you at FinCon btw!
I’ve been thinking about this video since I watched it. I like the premise of a smaller emergency fund but wouldn’t it be wiser to have a diversified portfolio with some assets non correlated with the stock market as you suggest to lower your risk of getting caught with your pants down. If the market crashes there is likely weakness within the job market, increasing risk of the average man getting laid off forcing him to sell his equities at an undesirable rate.He would likely be better off using something like Ray Dalio’s all weather fund and still get a competitive return to the S and P...
Appreciate the against the grain thought 💭. I like to have cash to be opportunistic but maybe that shouldn’t be considered rainy day fund if I’m planning to invest it.
I like this interesting perspective! One size doesn't fit all. Sometimes I wonder if it's best for me to keep 3-6 months expenses in a high-yield savings account (therefore no inflation) or just invest most of it. The biggest downside is if I have an emergency when the market is low, I'd have to sell my stocks for cheap and take a big bill. Double whammy.
@@BryceMatheson haha Definetly not crazy. There's a balance between stability vs growth. My emergency fund sits at $12k, and what I'll probably do is if a recession hits I'll dump a lot of my emergency fund into the market (though I wouldn't recommend this to most people, I'm just in a government secured position)
People tend to forget that savers are losers in this economy. I do think it makes sense to have some type of cash saved up but the majority of your money should definitely be investing in any of the asset classes. Interesting perspective so thanks for sharing!
Obviously, having an emergency funds in a savings or checking account is a bad idea because it will just get cannibalized by inflation. What about Money Markets? With the average money market account rate averaging at about 2% and with inflation sitting just below that, at least you won't be losing money. Another factor to take into account is that you would have easier access to your money (as you pointed out in the video this could potentially be a bad thing but at least you wouldn't have to pay a penalty). Great video man!
I just wrote a blog post about building an emergency fund. Everyone really should have the base level fund, we agree on that one of about $1000. Here are some reasons I have a larger emergency fund: 1. I have a child with a craniofacial disorder and autism. This year he needed oral surgery costing a couple thousand bucks. I don’t know when he will need more treatment but the orthodontics are coming. 2. I have parents in their 80s, who have saved nothing for their old age. They are both still working part time. As soon as their health gets worse, what? I realized recently that I am their retirement fund. 3. I don’t have a 401k. 4. I don’t want to liquidate stocks that have lost 30% or more in a downturn, hopefully they will go back up. Did you go through the 2007-2009 recession with money in the market? I did and it took some time for things to get back on track. 5. My rent alone is $3500.
Sane Cents Thanks for responding. I almost came back and deleted my comment because maybe too personal, but I think it is instructive so I left it. And I wanted to add, young single people probably don’t need multiple months of income in an emergency fund. Once you have kids though, the chances for emergencies increase, so increase the size of the fund! Blog is the same name as RUclips = Squintillions.com.
Joe Shmoe Yep! That’s a 3 bedroom in a nice part of California. Important for me to live here though for the great school district. My son gets the services he needs in public school with no hassle - speech therapy and a classroom aide. Good community for my other son for his after school activities. I don’t spend a lot on myself. As Paula Pant says, “You can afford anything, but not everything.”
Sane Cents wow that’s a solid piece of equipment. Your upload frequency isnt that often but the quality of your content is great! Thanks for checking out the channel! Quality > quantity = successful channel. Very inspiring
Hey Bryce. So I'm 20, a college student working part time & paying rent. I get £600 a month, so far I have £1,000 in savings, £900 in my checking account, £275 in an ETF & £500 in stocks. (I had £200 in a REIT, but I withdrew it because there was no point in investing such a miniscule amount in real estate.). I've started a private pension (known as a 401k in US) too, only £50 in that lol. Initially I went crazy on investing as I realise the power of compounding especially investing at a young age. But I've completely stopped now as literally EVERYONE is saying the market is going to crash. So I'm wondering what to do. Keep saving? keep investing? (if so in what).
@@BryceMatheson And I Love your Videos and that you take your Time to reply to comments :) Keep doing that and maybe with a few SEO Techniques and you're almost guaranteed to have a very successful RUclips Channel! 👍
ill say i have a lot more respect on your view point then i thought i would. i think keeping some cash on hand is still a smart idea. I agreed you shouldn't have 50k sitting in savings just because, but i like having 5-10k in cash for things that need to be immediately fixed.cheers!
Angelo Sandone Appreciate that! I try to think outside the box a little bit more than most. While I do think I’m definitely more of a risk-taker than most, I think all too many people hide in fear. Keep a little cash on hand, invest the rest. You’ll be much better off that way. Thanks for watching!
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Solution: high yield savings. Between 4-5% is good for emergency savings
I do respect your opinions and advice here BUT every option you give puts you and your viewers at risk of losing ALOT more than the rate of inflation. As of June 2019, inflation is 1.6% and ALLY bank gives 1.9% interest on their online savings acct. It would benefit you more to keep your EMERGENCY fund or “rainy day” money easily accessible in a high interest savings acct.
Totally agree , whenever you put money in the stock market you have to assume a lot of risk. That risk is not worth it for me , if you take your savings and put into an account making 3 to 4 % that is a lot safer than the stock market. Plus there is no penalties to taking your money out. If you have your 6 to 12 month emergency fund then put 1 to 3 percent of your annual income into stock market feel free. When it comes to retirement , my philosophy is to minimize risk and the stock market is risky
I totally get where you're coming from but I think the best thing about having some sort of emergency fund is the peace of mind that comes along with it. Last month my engine completely seized up and it wasn't covered under warranty (long story). So after trying to fight the dealership I'm stuck with a $6-7k bill. I wouldn't want to raid my retirement accounts for that or go into credit card debt. Thankfully I had my emergency fund to rely on.. does it suck? Absolutely. But after going through this I'll always have at least three months of expenses saved up.
Alex Beaulieu totally get it! To each their own. Not trying to point fingers or say one way is right or wrong. Just trying to share some perspective. Sorry to hear about your truck too. Best of luck.
Great video! I can see how this would work for people. It makes me twitchy not to have an emergency fund at all but I’ve got a strong need for security and safety. Good thing personal finance is personal and different things work for different people!
Great to meet you at FinCon btw!
I’ve been thinking about this video since I watched it. I like the premise of a smaller emergency fund but wouldn’t it be wiser to have a diversified portfolio with some assets non correlated with the stock market as you suggest to lower your risk of getting caught with your pants down. If the market crashes there is likely weakness within the job market, increasing risk of the average man getting laid off forcing him to sell his equities at an undesirable rate.He would likely be better off using something like Ray Dalio’s all weather fund and still get a competitive return to the S and P...
Thank you this help alot
Glad it helped
@@BryceMatheson I calculated my 6 months it just no way I can had 8 grand on my emergency I tried my best it only gotten me to 4 grand
Appreciate the against the grain thought 💭. I like to have cash to be opportunistic but maybe that shouldn’t be considered rainy day fund if I’m planning to invest it.
I like this interesting perspective! One size doesn't fit all. Sometimes I wonder if it's best for me to keep 3-6 months expenses in a high-yield savings account (therefore no inflation) or just invest most of it. The biggest downside is if I have an emergency when the market is low, I'd have to sell my stocks for cheap and take a big bill. Double whammy.
@@BryceMatheson haha Definetly not crazy. There's a balance between stability vs growth. My emergency fund sits at $12k, and what I'll probably do is if a recession hits I'll dump a lot of my emergency fund into the market (though I wouldn't recommend this to most people, I'm just in a government secured position)
People tend to forget that savers are losers in this economy. I do think it makes sense to have some type of cash saved up but the majority of your money should definitely be investing in any of the asset classes. Interesting perspective so thanks for sharing!
Obviously, having an emergency funds in a savings or checking account is a bad idea because it will just get cannibalized by inflation. What about Money Markets? With the average money market account rate averaging at about 2% and with inflation sitting just below that, at least you won't be losing money. Another factor to take into account is that you would have easier access to your money (as you pointed out in the video this could potentially be a bad thing but at least you wouldn't have to pay a penalty). Great video man!
I just wrote a blog post about building an emergency fund. Everyone really should have the base level fund, we agree on that one of about $1000. Here are some reasons I have a larger emergency fund:
1. I have a child with a craniofacial disorder and autism. This year he needed oral surgery costing a couple thousand bucks. I don’t know when he will need more treatment but the orthodontics are coming.
2. I have parents in their 80s, who have saved nothing for their old age. They are both still working part time. As soon as their health gets worse, what? I realized recently that I am their retirement fund.
3. I don’t have a 401k.
4. I don’t want to liquidate stocks that have lost 30% or more in a downturn, hopefully they will go back up. Did you go through the 2007-2009 recession with money in the market? I did and it took some time for things to get back on track.
5. My rent alone is $3500.
Wow, that's some high rent! 💰
Sane Cents Thanks for responding. I almost came back and deleted my comment because maybe too personal, but I think it is instructive so I left it. And I wanted to add, young single people probably don’t need multiple months of income in an emergency fund. Once you have kids though, the chances for emergencies increase, so increase the size of the fund! Blog is the same name as RUclips = Squintillions.com.
Joe Shmoe Yep! That’s a 3 bedroom in a nice part of California. Important for me to live here though for the great school district. My son gets the services he needs in public school with no hassle - speech therapy and a classroom aide. Good community for my other son for his after school activities. I don’t spend a lot on myself. As Paula Pant says, “You can afford anything, but not everything.”
Nice video quality! What kind of camera do you use?
Sane Cents wow that’s a solid piece of equipment. Your upload frequency isnt that often but the quality of your content is great! Thanks for checking out the channel! Quality > quantity = successful channel. Very inspiring
Hey Bryce. So I'm 20, a college student working part time & paying rent. I get £600 a month, so far I have £1,000 in savings, £900 in my checking account, £275 in an ETF & £500 in stocks. (I had £200 in a REIT, but I withdrew it because there was no point in investing such a miniscule amount in real estate.). I've started a private pension (known as a 401k in US) too, only £50 in that lol.
Initially I went crazy on investing as I realise the power of compounding especially investing at a young age. But I've completely stopped now as literally EVERYONE is saying the market is going to crash. So I'm wondering what to do. Keep saving? keep investing? (if so in what).
Then in that case it doesn't sound like a bad idea to take $2k out of my Roth to start my business
2:48 - 3:00 I have £1,000 saved but I'm hesitant to continue investing cause I'm hearing the market is gonna crash VERY soon.
@@BryceMatheson thanks for the advice
Every financial RUclips Channel ever said that you need an Emergency Fund. Glad that you are different and explain why it doesn't make sense! :)
@@BryceMatheson And I Love your Videos and that you take your Time to reply to comments :)
Keep doing that and maybe with a few SEO Techniques and you're almost guaranteed to have a very successful RUclips Channel! 👍
Credit is my new checking and savings account! debt is my new money! 💪💰😎
Sane Cents I'm learning everyday!💪💰😎 be obsessed or be average!🍻
Great points
ill say i have a lot more respect on your view point then i thought i would. i think keeping some cash on hand is still a smart idea. I agreed you shouldn't have 50k sitting in savings just because, but i like having 5-10k in cash for things that need to be immediately fixed.cheers!
Angelo Sandone Appreciate that! I try to think outside the box a little bit more than most. While I do think I’m definitely more of a risk-taker than most, I think all too many people hide in fear. Keep a little cash on hand, invest the rest. You’ll be much better off that way. Thanks for watching!