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06:18 PM on 11/27/12 
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David87
That guy
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Wilmington, DE
Male - 26 Years Old
Send some money to my pay-pal. Show some charity that you libertarians are always talking about. lol.


lol. A+
06:34 PM on 11/27/12 
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birdman
DUNGEON MASTER
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Atlanta, Ga
Male
Send some money to my pay-pal. Show some charity that you libertarians are always talking about. lol.

Get a job hippy!
06:36 PM on 11/27/12 
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Mitch
this is water
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Jamaica Plain, MA
Male - 25 Years Old
Moderator
I'm in a similar situation, kind of - I all of a sudden have a healthy amount of money that I really don't know what I'm supposed to do with. Except I don't have any debt, and I don't know a thing about investing.
06:40 PM on 11/27/12 
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Jake Gyllenhaal
What's up Hot Dog?
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Connecticut
Male
I'm in a similar situation, kind of - I all of a sudden have a healthy amount of money that I really don't know what I'm supposed to do with. Except I don't have any debt, and I don't know a thing about investing.

Invest in gold!
06:43 PM on 11/27/12 
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birdman
DUNGEON MASTER
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Atlanta, Ga
Male
I'm in a similar situation, kind of - I all of a sudden have a healthy amount of money that I really don't know what I'm supposed to do with. Except I don't have any debt, and I don't know a thing about investing.

I would just hold onto it right now.
07:04 PM on 11/27/12 
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Nevuk
Post-Structural Anarchist
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Cincinnati OH
Male - 25 Years Old
Well, they are all higher than the rate I am earning on my savings. So while I have cash in the bank, I am losing money on my debt's interest rate. So the question is whether or not the risk of having a low savings balance for a while so I can wipe my debt out is worth it.
My father's advice on this issue was that it basically amounted to how many months in the worst possible scenario it would take you to find another job. Add up the monthly expenses you have and the rest of the money after the point you've determined to be how long in the worst-case you would need to live off of your savings. That's better off being used to pay off the high interest rate loans (ie credit cards) as no sane, safe investments are going to give better returns than the rates on those credit cards.

Cut-off points people frequently choose are generally 3 month increments. 3/6/9 months are common (my father recommended 6 as safe amount of time for younger people, like in your 20s when you don't have mortgages or children, said that 3 was something you pretty much only did if you had extremely few expenditures and were very young. Of course this was before the recession hit fully). If you're wondering why I'm referencing my father it's because he's a very talented accountant (ie, tied for second on a 10,000 accountant exam (the CIA), he's a CPA) who takes very cautious stances about money management.

The other option of a cut-off point you can pick involves how long your unemployment benefits would last (or if you would have them at all).
07:16 PM on 11/27/12 
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Nevuk
Post-Structural Anarchist
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Cincinnati OH
Male - 25 Years Old
I'm in a similar situation, kind of - I all of a sudden have a healthy amount of money that I really don't know what I'm supposed to do with. Except I don't have any debt, and I don't know a thing about investing.
Certificate deposits, Treasury bonds/Bills/notes are as safe as you think the US government is. (T-bills) are exceptionally safe short-term (ie weeks rather than years) investements

http://en.wikipedia.org/wiki/United_...asury_security

Certificate deposits are safe for amounts up to 250$k due to the FDIC, however be sure that if you use a CD it's with a bank that actually has FDIC and be suspicious of rates above 5%.

The stock market is always on average the best investment return over the course of 10 years but... very volatile at the moment and requires a lot more time in research
07:45 PM on 11/27/12 
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apoemtothedead
ppppppppttttttttt.
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TX
Male - 26 Years Old
I'm in a similar situation, kind of - I all of a sudden have a healthy amount of money that I really don't know what I'm supposed to do with. Except I don't have any debt, and I don't know a thing about investing.
Liberty bonds
08:08 PM on 11/27/12 
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bladerdude360
saved latin. What did you ever do?
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Champaign-Urbana,...
Male - 23 Years Old
I would pay off the debt, but I don't necessarily have business knowledge or training to back that up, just my gut.
08:14 PM on 11/27/12 
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swampthingordie
Registered User
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Tallahassee
Male
do itt
08:30 AM on 11/28/12 
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Love As Arson
Resident Marxist
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The Motherland
Male - 29 Years Old

I have a job. I just want YOUR money. Redistribution,etc.
09:10 AM on 11/28/12 
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dylanagibson
The Littlest Things
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STJ MO
Male - 23 Years Old
What I've been doing the past year is usually paying twice or three times the minimum payment amount (depending on what it is) as long as it leave me with plenty enough to pay for my cost of living + some cushion for emergencies. Last month I blew a tire and had to buy all new tires so it's kinda set me back a bit.
09:44 AM on 11/28/12 
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birdman
DUNGEON MASTER
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Atlanta, Ga
Male
My father's advice on this issue was that it basically amounted to how many months in the worst possible scenario it would take you to find another job. Add up the monthly expenses you have and the rest of the money after the point you've determined to be how long in the worst-case you would need to live off of your savings. That's better off being used to pay off the high interest rate loans (ie credit cards) as no sane, safe investments are going to give better returns than the rates on those credit cards.

Cut-off points people frequently choose are generally 3 month increments. 3/6/9 months are common (my father recommended 6 as safe amount of time for younger people, like in your 20s when you don't have mortgages or children, said that 3 was something you pretty much only did if you had extremely few expenditures and were very young. Of course this was before the recession hit fully). If you're wondering why I'm referencing my father it's because he's a very talented accountant (ie, tied for second on a 10,000 accountant exam (the CIA), he's a CPA) who takes very cautious stances about money management.

The other option of a cut-off point you can pick involves how long your unemployment benefits would last (or if you would have them at all).

If I pay everything off I will be left with about a month of living expenses. But I am also going to have a lot more money because I am not paying bills on my debt, so I could probably get up to 6 months of savings pretty quickly. There are some things I want to do to my condo next year.
09:53 AM on 11/28/12 
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Kapa73
Registered User
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Male - 28 Years Old
I am an in a position right now where I have enough savings to wipe out all of my debt, credit cards and the remainder of my student loans. However, doing so wouldn't leave me with a whole lot of savings. My condo is underwater by about $20k. I paid off my car last year so that isn't an issue.

In this economy, do you think it is more important to have lots of savings or no debt?


I am in this EXACT position right now. I could pay off the entirety of my subsidized loans before I even started accruing interest on them by hte end of December. However, that would leave me with little to no personal cushion...a very scary thought. I am 100% anti-debt and anti-paying interest, but the thought of having less than 2 K in savings on hand is scary.

I might just wait a month or two - pay the interest for those months - then deliver uncle sam the wollip of a down payment and say GET OFF MY BACK
10:15 AM on 11/28/12 
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sjb2k1
#4
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the bull city
Female - 31 Years Old
Moderator
yeah honestly if you are only gonna wait a couple of months, and it'll help you get more of a cushion that you're comfortable with, makes sense to me.



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