Question: I always seem to have car emergencies. Isn’t there a better way to live?

Answer: Create an “Anti-Emergency Savings Fund “for normal and necessary expenses that do not occur every month. For example, you can pay your property taxes with your mortgage, save 1/12 of it every month, or just have an “emergency” when it shows up every year. By saving small amounts every month, you will actually have the money available to pay your property taxes when they are due. No more surprises!

The same is true with other types of normal expenses like car repairs, home repairs, school fees, holiday gifts, medical bills, etc. Even vacation!

I like to keep my funds in the best bank on the planet – ING Direct. ING lets you have as many accounts as you want without any minimums or fees – and they best just about the highest interest rates out there! And the best feature is “nicknaming” them all. That way I can look at my “home repair” account or “vacation” account and know exactly how much I have available! Of course, they’re FDIC insured. Get their Electric Orange high interest savings account.

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Emergencies!

Question: Why should I have emergency savings when the interest rates are so low? What’s the use?

Answer: When you have savings, you can be your own banker and not have to use your credit cards for things like car repairs or medical bills. Even if you have a little bit of money set aside, you will feel so much better having even some money to put toward a “crisis” situation.

Your Emergency Savings money isn’t really designed to make you a lot of money — it’s supposed to keep you out of trouble! If you have your emergency money invested in stocks and need it when the market is down, you’ll be hurt. You’ll may also trigger capital gains taxes.

I recommend ING Direct (http://www.ingdirect.com/) for your all your savings needs. It’s an online bank that is very easy to work with and pays some of the highest rates around.

Warmly, Cindy

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Low Rates for Emergency Savings?