The Best Place to Put Savings

by | Aug. 09, 2010

Finances

Dear Dave,

Where is the best place for me to put my savings?

Anonymous

Dear Anonymous,

Saving and investing are two things I talk about a lot. Investing is when you're going to leave the money alone for five years or more. I'm talking about things like retirement, college planning or saving up to buy a house. For these things, I recommend good, growth-stock mutual funds. Make sure you're looking at mutual funds that have stable track records of five to 10 years, and then spread your money across these four categories: growth, growth and income, aggressive growth, and international.

Now, when it comes to savings, I'm not really concerned with making money. Things like setting money aside for vacations, Christmas, or even an emergency fund fall into this category. One and one-half percent would be an incredible rate on a savings account right now, so you're not going to get rich off anything like this. The idea is to park this money in a safe place, and keep it separate from the rest of your money so it doesn't get spent on the wrong thing!

-Dave

* For more financial help, please visit daveramsey.com.

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