How to Build an Emergency Fund That Makes Money Too!

It’s not glamorous or financially “sexy,” but finances rarely are. I’m talking about the less appealing elements of building a sound financial plan. For most families the first action item is to build an emergency fund.

The drill is fairly straightforward, but building an emergency fund is often reliant on manually moving money from each paycheck into a separate checking or savings account...with a rock-bottom interest rate. By month’s end, a meager 20 cents of interest has trickled into your account. Yipee.

In this post I’ll tell you how to build an emergency fund more successfully and how to earn much more interest on your savings, while still keeping your emergency fund safe and accessible.

What Abraham Lincoln Did About His Huge Debt Problem

Unlike some influential figures of his time, Abraham Lincoln did not grow up as a child of privilege. Born in a one-room log cabin to humble parents, he completed backbreaking work alongside his father to scrape out a family living.

Lincoln could wield an axe and clear land like no other, but he didn’t enjoy the hard labor of country life. Determined to free himself of his “country bumpkin” upbringing, he set his eye on more prosperous, risky pursuits.

His ambition got him into a big financial jam early on, but the real story is what Lincoln did to get out of it.

Is There Any Such Thing as "Good Debt"?

In my Financial Essentials class, Week 2 often covers the topic of debt. It starts with a conversation about compounding interest, and how this “Eighth Wonder of the World” can either hurt you or help you through “good” or “bad” debt.

But a recent conversation with a friend has me thinking: Is there really any such thing as good debt for the typical family?

I’d like to discuss two forms of debt which we gladly justify--or label as “good debt”--and for a moment take a contrarian view as to why these commonly accepted forms of good debt may not be so great.

How Good Are the Tax Savings in Your 401k or IRA?

There are many advantages to using your 401k or IRA for future savings. These retirement tools are truly without compare in many respects. But if I had to pick out one attribute that shines above the rest, especially when compared to other ways to save, it’s the tax advantages.

This is well illustrated with a powerful example from an American College textbook I was recently reading through.

How Families--Young and Old--Should Think About Social Security

A wise person was once asked: What’s your single most valuable asset? His response was not his home, his business, or his 401(k). It was his future cash flows. Future cash flows--and specifically increasing ones--can dwarf other assets in comparison.

Do you look at Social Security the same way? Your future Social Security benefit is a series of future cash flows. How much those cash flows will be is unclear. It’s largely up to you, how much you earn, and how you utilize the Social Security system.