Saving and Planning
Balancing the future with the present.
The Basics
Saving is about balancing the future with the present. It involves the mathematical decision of when to use savings to pay down debt versus keeping cash on hand.
Remember the Time Value of Money
Emergency Funds
Crucial for unexpected expenses. Try to maintain a buffer that prevents you from needing high-interest debt for surprises.
Retirement Plans
Borrowing from IRA or 401(k):
- Might have high penalties
- Might trigger taxes
- Check for hardship exceptions
Life Insurance
Borrowing from your life insurance plan is possible, but it is important to understand the costs. There are usually more favorable options available.