BlogHer - Five Ways to Safeguard Your Money Now - Comments

Many credit unions ...

Alanna Kellogg — Tue, 21 Oct 2008 21:00:58 -0500

... are members of a network of credit union ATMs that offer the same convenience / pricing as the largest banks' individual ATM networks. Other credit unions create the same effect by waiving/reimbursing fees when their customers use other banks'/other ATMs.

Alanna Kellogg
Kitchen Parade &
A Veggie Venture

Watching the markets

bluewaves — Tue, 21 Oct 2008 20:13:38 -0500

I had a difficult time seeing that I had lost 2,400 in my 401K plan in the last 3 months. However, it was amazing to me that one of my friends in France had invested her money in an Icelandic bank, which failed and she lost $300,000.

How we psychologically get through these challenging times is important.

I certainly hope the future will be much better financially.

www.lovecoachhandbags.com

Phew!

lulumom — Tue, 21 Oct 2008 17:52:02 -0500

Great post, Jennifer. Simple, calm, logical. Not only as women, but as moms, we are entrusted with some major decisions. I was sweating for a few weeks there, I had to choose a safe place for my sons' investments. Our financial advisor's bank was "in the papers" as troubled, and I, like many, find myself becoming increasingly skeptical of advice.

CDs seemed safe, glad to hear you confirm. Short, medium term (laddering?) so there are no penalties for withdrawal. I also posted a Stay Calm bit on my blog for Moms who have to keep the chill during this rough time.

LuluMom

http://lulu-momblog.blogspot.com/

I'm not panicking... or am I?

Denise — Tue, 21 Oct 2008 11:26:02 -0500

I started to say I'm not panicking but then again, I'm pretty much ignoring this whole thing in hopes that one day I'll wake up and life will be normal again.

Now that I type it - that feels a wee bit like a form of panic.

Off to re-evaluate my position, kthxbai. Ugh.

~Denise
BlogHer Community Manager

Flamingo House Happenings

Great Advice

summersfall — Tue, 21 Oct 2008 11:14:23 -0500

Far too many people are panicking, especially those who are no where near retirement age. Truthfully, I don't have as much in savings as I would like since some medical bills ate any nest age that we had. But I'm in my 20s and doing something that I love. I'm not happy with my bank and have been looking into the local credit unions.

Stacy at Getting Pregnant Tips

note about banking online

superviva — Tue, 21 Oct 2008 08:44:52 -0500

In times when unsavory characters are getting more desperate for money it's especially important to "practice safe banking."

Before you bank online make sure you have up to date, award winning security / firewall software on your computer and use strong passwords.

:) A public service message from me!

PS - NPR had a great story that local/regional banks are very strong. My sister said her regional bank didn't issue subprime loans and is having no problems.

Earning our own pinstripes

Lisa Stone — Mon, 20 Oct 2008 18:50:59 -0500

Jennifer welcome! I love this paragraph:

Empower yourself: If there's one lesson to come of all this, it's to know what's in our bank account and your savings accounts. Funny, but even the pinstripes on Wall Street didn't even fully understand the complex products they were creating and selling -- but you need to. It's your future, your life. It's why we'll be introducing WeSeed -- to help you turn what you know into stock ideas and rather than just being a customer of, say, Target, you learn to be an owner. Owning just one share of stock can change the way you look at the world and even feel about yourself.

I completely agree. The difference in mindset between a customer versus an owner is exactly what's happened to me in the past month. I spent the weekend reviewing all my monthly expenditures and came to the decision that I have got to consolidate my various insurance plans -- think it'll save me a percentage on what I'm currently earning.

Thanks for the links, which I look forward to reading. I would never have considered a credit union until you recommended it -- I'm afraid I've gotten addicted to the national ATMs -- but now I think I'll look for one near work or home.

I'm excited to read next week's installment!

Lisa Stone
BlogHer Co-founder
Surfette

BlogHer is non-partisan but our bloggers aren't! Follow our coverage of Politics & News.

Five Ways to Safeguard Your Money Now

Jennifer Openshaw — Mon, 20 Oct 2008 14:56:26 -0500

I know, I know. You're watching your investment accounts dwindle and you’re wondering what to do. And for that matter, what to do with the money sitting in your bank accounts right now.

Is it even safe? And can you trust your bank, especially with more bad news arriving each day?

So I've been talking to folks on shows like the CBS Early Show, and now I'm going to share with my new friends here my best guidance for you. Every move we make matters, because as women, we’ve got more at stake.

So let's start with the obvious question I know you're asking: should you divest? Is your bank safe? Should you take your money out of the market and put it under the comfy -- and forever safe -- mattress?

No.

Here's why. First, money under the mattress, or even in a traditional bank account, is a losing proposition over time. That's because those bank fees, taxes on your paltry 1–2% interest earnings, and inflation -- the rising cost of buying bread and those cool Manolo shoes -- eat into your money. Over time, you can't buy as much.

So instead of panicking and doing something rash just for the sake of doing something, take a time out and think things through. If there's anything good to come from this collapse, it's that people who normally don't pay enough attention to their money will finally take notice -- and take control.

Along those lines, here are five ways you can right your financial ship and restore a little order to your life:

Relax, don't overact: The biggest mistake you can make right now is to panic and do something knee-jerk like cashing out of your bank and stowing your hard-earned dollars under your mattress. Plus, even mattresses aren't totally safe: They're not immune from fire, theft, even hurricanes. And are you really going to feel better by having that much cash at home?

Make sure your savings are safe: By now, you should know that any savings accounts you have should be with an FDIC-insured bank or savings institution. That means the US government guarantees your money for up to $250,000. If you're married, you can have an account in your husband's name as well as a joint account, so that as much as $750,000 at a single bank can be protected. Make sure wherever you park your cash, that bank it has the FDIC stamp on it. Credit unions, covered by similar "NCUSIF" protection, also work (more about CUs in a moment).

CDs are a pretty attractive place to stash cash you'll need in three months to a couple years, with yields ranging from 3–5% depending on their maturity date. Just be careful about locking up money for too long, as you'll get hit with a pre-payment penalty if you want to tap it earlier.

For super short-term cash, money you might need tomorrow for an emergency, know that money market funds got a special protection from Uncle Sam (so long as your money was in those funds by September 19th).

Bank online: You may be used to banking at your brick-and-mortar branch, but did you know that going online can get you a bigger bang for your buck? Online savings accounts at places like ING Direct (ING and HBC, which are FDIC insured, offer interest rates of 2.75% and 3.25% respectively. These banks have the same features as regular banks, like checking accounts and online bill payment.

Consider a credit union: OK, they're about as sexy as an accountant in a bow tie. But they offer several benefits: They have non-profit status, so they can offer services at lower costs than many banks -- from late fees to bounced check fees. That translates to lower interest rates on loans (including mortgages), and higher interest rates on savings accounts and CDs. One problem: They usually don't have as many branches as banks, so make sure the location is convenient. Also, they don't necessarily invest in technology the way a big bank does but still, I've been a fan.

Empower yourself: If there's one lesson to come of all this, it's to know what's in our bank account and your savings accounts. Funny, but even the pinstripes on Wall Street didn't even fully understand the complex products they were creating and selling -- but you need to. It's your future, your life. It's why we'll be introducing WeSeed -- to help you turn what you know into stock ideas and rather than just being a customer of, say, Target, you learn to be an owner. Owning just one share of stock can change the way you look at the world and even feel about yourself.

So find yourself a safe port in this financial storm, and wait it out for better weather. Clear sailing days undoubtedly lie ahead.

Financial bloggers are posting their own reactions to the current economic state:

The Digerati Life is retrenching her financial goals -- in a smart, non-panicked way.

Morra Aarons Mele interviewed two leading economists to learn how we can get credit flowing again.

Wise Bread finds the silver linking in the economic crisis.

Stay tuned, because next week I'm going to help you save money and live within your means ... while still having some fun.

Jennifer Openshaw's hip, practical advice has been seen on Oprah, Dr. Phil and CNN. The host of ABC Radio's "Winning Advice," Jen is now President of WeSeed, a new site designed to demystify the stock market for real, everyday people, and author of The Millionaire Zone (Hyperion).