Best ways to save money right now?

brightnomad15 said:It's a decent enough amount, I suppose, especially when you factor in that slice of the pie meant for the insurance company—even someone like Made-off probably wouldn't feel too embarrassed about that.
My bad, I didn't mean to let that slip out. No hard feelings, I guess.

It’s not exactly groundbreaking news, I suppose; they've been selling that stuff over in the Netherlands since all the way back in the early 90s. I think insurance companies ended up setting aside something like 6 billion dollars just to cover themselves because of how "transparently" they were supposed to be informing clients about policy costs, though I stopped following the numbers after that point. 😍I guess it might be worth looking into some kind of compensation, maybe.

Best of luck, I suppose.

The Netherlands doesn't matter to me at all; I'm talking about America.

I suppose I agree, the country doesn't really matter much—unless we're talking about consumer protection or financial regulations, I guess—but the actual product is pretty much identical everywhere else in the world, barring some minor tweaks.

The US isn't some isolated financial island; the insurance companies and banks responsible for paying out compensation are active right here in the American market too. Google is your friend.
It’s basically the same financial products, the same insurance companies, and more or less the same rules of the game, just with different currencies involved, maybe.

Hey everyone! So, I was messing around with some numbers and did a little bit of math—hopefully, this helps someone out if you're looking at the same thing:


There you go.

👍 I've always been against those housing savings plans anyway 🙂

Jeremy Jackson2 said:Hey everyone! So, I was messing around with some numbers and did a little bit of math—hopefully, this helps someone out if you're looking at the same thing:


There you go.

Wait, you actually assumed there isn't an origination fee for residential loans? ($243)

Jeremy Jackson2 said:Hey everyone! So, I was messing around with some numbers and did a little bit of math—hopefully, this helps someone out if you're looking at the same thing:


There you go.

How'd you end up with only $167 in interest?

Richard Wright said:Wait, you actually assumed there isn't an origination fee for residential loans? ($243)

From what I've seen, most places don't really ask for that entry fee—they usually just toss it in as a little gift (WOW🙄)

James Rogers53 said:How'd you end up with only $167 in interest?

So, the interest is roughly 3% on whatever balance is sitting in the account... so like, 3% of $1917 during that first year $58, then maybe 11,500 the second year $117, and so on. I mean, I'll admit the interest rates are higher than $167, but since the maintenance fees are also higher than $150, I didn't bother adjusting those numbers. I knew exactly where my math was off, and honestly, those two amounts basically cancel each other out anyway. Plus, I already uploaded my Excel sheet....

The big issue for me, though, was how much I lost because I was receiving $30 a month from somewhere else and putting it straight into the housing fund. But whenever I’d deposit those dollars, they’d convert them into USD, put them in the account, and then convert them back to dollars again. In other words, I was depositing $30 worth of currency at one rate, but it hit the account at another. Every single time I made a deposit, I was losing money on the exchange rate $5.00. That's like 15 times a year, 12 months a year $60 of losses annually. And now, when they finally pay me out, it's going to be at an exchange rate that's about 40 cents worse than when I started. On top of that, my fees were $70—$50 for setting up the contract and $20 for some random nonsense I still don't even understand to this day.

It was honestly a nightmare. But, if you ask me, the only savings plan better than the housing one is the kids' account. Every other option that gives you what you get with the kids' account requires you to lock your money away in a CD. That's the main downside, I guess, but then again, your money is locked up in the housing account too... it really just comes down to what you prefer. From a purely financial standpoint, getting 15% of the inflation rate is decent if you aren't starting with the full lump sum, but if you already have the whole amount ready to go, regular savings is probably better.

Personally, I think the kids' account is awesome. You get 4.5% interest, no need to lock it up in a CD, you can withdraw funds without a bunch of hoops to jump through, and you even get little gifts for the kid every time you make a deposit. Plus, the bank sends a birthday gift! I'm not sure how they handle everything else, but for anything involving children, Hypo banka Alfa is the absolute gold standard.

Your math is a bit off.

For the housing savings, you calculated interest as if you were adding $1667 every single year—but for the kid’s account, you assumed you started with 25 $0.00 right out of the gate. In reality, the interest on the housing fund ends up being much higher than what you wrote—probably closer to $1167.

Plus, the whole point of housing savings is to lock in a low fixed interest rate, which isn't going to happen if you're using a child's savings plan instead.

Also, saying that money is always available with the kid's account isn't exactly true—if you pull it out before the term is up, they'll strip away that interest entirely.

So, if you're actually looking to tackle a housing issue, the housing savings plan is definitely the better way to go.

James Rogers53 said:Your math is a bit off.

For the housing savings, you calculated interest as if you were adding $1667 every single year—but for the kid’s account, you assumed you started with 25 $0.00 right out of the gate. In reality, the interest on the housing fund ends up being much higher than what you wrote—probably closer to $1167.

Plus, the whole point of housing savings is to lock in a low fixed interest rate, which isn't going to happen if you're using a child's savings plan instead.

Also, saying that money is always available with the kid's account isn't exactly true—if you pull it out before the term is up, they'll strip away that interest entirely.

So, if you're actually looking to tackle a housing issue, the housing savings plan is definitely the better way to go.

Assuming I'm totally crazy :locco: and decide to take out a loan...

The Hypo account doesn't have a set term or anything, it's not locked away, it's just regular savings in my kid's name where I get 4.5% interest on whatever balance is sitting there. I can pull the cash whenever I feel like it without having to explain myself to anyone, though if I don't want to close the whole thing out, I have to leave $17 behind. And then on that $17, I'm getting 4.5% interest. So far, I've put in $2333, and there's currently $2567 in there (within one wild year). Once my $25,000 payout from Raiffeisen hits, I'll dump it all into the Hypo account, and then my interest for 2011 will be 4.5 x (32700/100) = $490. There aren't any maintenance fees, no exit fees, no weird exchange rate losses, and the money is just... free and available whenever. Plus the interest! About two years ago, I was actually thinking about a mortgage, and here's a shot of how things looked back then

I honestly don't see how this could ever be a good deal. Am I really paying the bank $5.00 just for a ten-dollar bill? I guess I'm just not a "debt" person. I just don't see myself doing that.

I don't think anyone here has actually crunched the numbers on interest rates yet... but let's look at it this way: if you lent me 500 $0.00, what amount would you realistically expect back from me after $10? What could you actually accomplish with that capital over a 30-year span? Even a major bank like JP Morgan Chase pays you interest just to hold your savings. Just consider how much you'd need to park in an account today to have $166667 ready in 30 years 😉... and that's just for a standard mortgage. In my opinion, people don't take out these types of loans without a serious reason. Not everyone has a windfall waiting for them from a parent or a spouse to solve their housing needs.

Paul Jackson61 said:I don't think anyone here has actually crunched the numbers on interest rates yet... but let's look at it this way: if you lent me 500 $0.00, what amount would you realistically expect back from me after $10? What could you actually accomplish with that capital over a 30-year span? Even a major bank like JP Morgan Chase pays you interest just to hold your savings. Just consider how much you'd need to park in an account today to have $166667 ready in 30 years 😉... and that's just for a standard mortgage. In my opinion, people don't take out these types of loans without a serious reason. Not everyone has a windfall waiting for them from a parent or a spouse to solve their housing needs.

That's exactly what I'm thinking too! I don't have any apartments or houses to inherit from anyone, but honestly, taking out a loan and putting my kid's financial future at risk just doesn't feel right to me. If I'm the one taking out the loan, then it's on me to pay it back—not my daughter, neither now nor after I'm gone.

Banks have every right to lend and to collect. If a loan is truly your only option left, then there isn't much to debate, really. I'm just speaking for myself when I say I wouldn't take out a loan because of a bad experience I had once. And regarding savings, everything basically boils down to: "I don't work for money. I work for interest."

In my opinion, if someone inherits an apartment, they should probably settle any outstanding utility bills...that’s the bare minimum you can do when you walk away with such a valuable asset. But now, if you actually inherited a debt—like in your situation—that seems legally unsustainable. I assume there were co-signers on the loan, or perhaps some other legal tie? Who's to say you had a good relationship with your father? Under what law would you even agree to take over his debt after he passed?

Jeremy Jackson2 said:That's exactly what I'm thinking too! I don't have any apartments or houses to inherit from anyone, but honestly, taking out a loan and putting my kid's financial future at risk just doesn't feel right to me. If I'm the one taking out the loan, then it's on me to pay it back—not my daughter, neither now nor after I'm gone.

Banks have every right to lend and to collect. If a loan is truly your only option left, then there isn't much to debate, really. I'm just speaking for myself when I say I wouldn't take out a loan because of a bad experience I had once. And regarding savings, everything basically boils down to: "I don't work for money. I work for interest."

I honestly can't tell what you're trying to prove with all these posts. You throw out a mountain of calculations—some of which are flat-out wrong (sh)—but to what end? What's the goal here? You complain about high repayment amounts if you take a loan, yet a few posts ago, you were comparing kids' savings accounts to housing savings accounts, claiming one yields $100 more per year (which is incorrect, by the way).?! It seems like you want to maximize your returns while minimizing your costs. But then, when it comes to a loan, suddenly it's too expensive. That feels pretty hypocritical to say.
Just a quick side note: the effective interest rate on housing savings is between 5.7% and 6.2%, which is actually better than the 4.5% on kids' accounts. However, I'm not trying to compare two completely different products; I'm just trying to meet you where you are with the math. Every financial product serves a specific purpose and target audience; the issue is that some people struggle to pick the right one for their specific needs and current financial situation.

Don't get me wrong, I respect your stance. We all have different views on quality of life. For some, it means renting; for others, it means taking out a 30-year mortgage to buy a home.
And we all know it's probably best not to get too involved in a debate about personal taste...🙂

I’ve been tucking money away in a kids' savings account, and by the end of the year, I’m just going to roll it all over into a residential fund. I’m not entirely sure if the math works out to be better, but it’s just easier that way. The kids are constantly shoving loose change into their piggy banks, so we just dump it into the kids' account. Then, once December rolls around, we have to close out the housing fund for the year anyway...☕

crimsonseal13 said:I honestly can't tell what you're trying to prove with all these posts. You throw out a mountain of calculations—some of which are flat-out wrong (sh)—but to what end? What's the goal here? You complain about high repayment amounts if you take a loan, yet a few posts ago, you were comparing kids' savings accounts to housing savings accounts, claiming one yields $100 more per year (which is incorrect, by the way).?! It seems like you want to maximize your returns while minimizing your costs. But then, when it comes to a loan, suddenly it's too expensive. That feels pretty hypocritical to say.
Just a quick side note: the effective interest rate on housing savings is between 5.7% and 6.2%, which is actually better than the 4.5% on kids' accounts. However, I'm not trying to compare two completely different products; I'm just trying to meet you where you are with the math. Every financial product serves a specific purpose and target audience; the issue is that some people struggle to pick the right one for their specific needs and current financial situation.

Don't get me wrong, I respect your stance. We all have different views on quality of life. For some, it means renting; for others, it means taking out a 30-year mortgage to buy a home.
And we all know it's probably best not to get too involved in a debate about personal taste...🙂

Hi there,

Someone brought up loans, and I was just explaining that for me, that's just not an option because, well, I'm neither at fault nor responsible for paying back someone else's debt.

What I was actually doing was looking to switch banks, so I was asking which one offers the best terms regarding fees, good online banking, and a reasonably helpful customer service department. In one of the replies I got, a gentleman mentioned investing in a money market fund. I didn't even know what that was, so I went ahead and did my own research on it.

I have $8333 ready to go in full right now, so for me—personally, just for me—savings is a better route than a home savings plan. Anyway, I basically closed the book on the whole loan topic back in 2008 (even this image is from 2008 regarding loans). It's kind of like choosing between Raffalelo and Roche; some people love coconut, others prefer chocolate. You guys are arguing that home savings are better if someone wants to qualify for a loan—and I totally agree with that. You're advocating for loans as a way for people who have no other way to solve their housing issues—who are currently without a roof over their heads—to fix that problem, and I agree with that too. You say parts of these tables are inaccurate, or at least poorly explained; well, I made these tables internally based on my own experience with my savings account. Maybe the math works out better for someone else using the home savings plan instead of the child savings plan, but again, that's very individual. I was just detailing my own situation. While looking for a good bank, I put together a list of fees. I took that list to the bank and actually ASKED the representative to confirm the numbers listed online before signing anything. I posted this table here just to save someone else some time, but I definitely wasn't suggesting anyone should head to the bank and open an account blindly just because of my chart. It's only logical to verify the numbers before signing. But like Google once said:

"Google probably operated under the assumption that no one intelligent enough to use a phone would walk into traffic, but it seems they had too high expectations."

All in all, I'm Team Raffaelo.👍😍

What currency should I actually be stashing my cash in right now?

Nobody actually knows.

Everyone swore up and down that the dollar was headed for a crash—they were convinced it would drop 20-30% against the dollar, while the euro would just climb against everything else. They kept insisting the smartest move was staying in USD to catch those high interest rates.

I just need the currency to stay steady. I don't mind if the interest rate is a little lower, as long as it isn't pathetic🙂. I’m looking at a term of at least two years. I've got plenty of cash on hand.

1. At what point does it actually make sense to swap my USD for Euros and just save in that instead?
2. I've been checking rates, and right now JP Morgan Chase and Wells Fargo look decent for Euro savings. What's your take on them, or do you guys have better suggestions?

Thanks,

ruggedangler532

I’ve been looking into an interesting strategy that could potentially net you an annual return of roughly 12–15%, all while keeping risk at a minimum:

The idea is to park your capital in a money market fund (which generally yields around 6–9% annually). Then, around mid-December, you pull those funds out and pivot into AT&T stock (which typically sees gains of about 6–10%). You’d want to sell your AT&T shares just before the company officially announces its dividend payout—specifically, before February 10th.

Now, you might be wondering: why bother selling the stock before the announcement?
It’s pretty straightforward: once a dividend is declared, the stock price almost always drops by the exact amount of the dividend payout. From a purely mathematical standpoint, there’s no real benefit to holding onto the shares longer than necessary.
There is, of course, the small chance that they decide not to issue a dividend at all, but we won't know that until after February 10th. Historically, however, the stock tends to trend upward starting about two months before the dividend announcement. By selling right before that news hits, you capture that upward momentum regardless of whether they actually end up paying out a dividend this year or not.

Once you've liquidated the position, you simply move the cash back into the money market fund and repeat the cycle every year.

copperowl17 said:I’ve been looking into an interesting strategy that could potentially net you an annual return of roughly 12–15%, all while keeping risk at a minimum:

The idea is to park your capital in a money market fund (which generally yields around 6–9% annually). Then, around mid-December, you pull those funds out and pivot into AT&T stock (which typically sees gains of about 6–10%). You’d want to sell your AT&T shares just before the company officially announces its dividend payout—specifically, before February 10th.

Now, you might be wondering: why bother selling the stock before the announcement?
It’s pretty straightforward: once a dividend is declared, the stock price almost always drops by the exact amount of the dividend payout. From a purely mathematical standpoint, there’s no real benefit to holding onto the shares longer than necessary.
There is, of course, the small chance that they decide not to issue a dividend at all, but we won't know that until after February 10th. Historically, however, the stock tends to trend upward starting about two months before the dividend announcement. By selling right before that news hits, you capture that upward momentum regardless of whether they actually end up paying out a dividend this year or not.

Once you've liquidated the position, you simply move the cash back into the money market fund and repeat the cycle every year.

Should I go with a Chase money market fund or a standard USD one? Which one do you think hits better? Where are the returns higher? And should I really jump in and out in mid-December? Why specifically then? I'm not actually looking to buy any AT&T stock myself...