SECTION 2 Building » The third thing you save money for is “ building. “It was character 23 that got us out of bed, » is the key ingredient when it to commitment that 24 moved us into action, wealth building. and discipline that enabled us to follow » Building wealth is a , not a sprint. through.” 25 Z IG Z IG L A R American author and motivational speaker JOURNAL QUESTION: 2.2 W Why do you so many people borrow money for large purchases instead of using a sinking fund? to Start Saving? Read These Bank Tips First! * REMEMBER: The emergency fund is not intended to grow wealth, so interest earned is not a factor. interest-bearing accounts than » A bank is one of the safest places to keep financial institutions that offer accounts your money. Since the financial crisis of that resemble bank services: The most 2008, the federal government (Federal common are brokerage cash Deposit Insurance Corporation or FDIC) management accounts, credit union increased the level of insurance on bank accounts to $250,000 per depositor. accounts, and mutual fund money market accounts. » An interest-bearing account is an account » Inflation can eat up the interest you earn that generates interest income on the on an interest-bearing bank account. Even available balance in the account. a low rate of inflation (a persistent rise in the cost of goods and services or the » The convenience of a bank account decline in the purchase power of money) comes at a cost. Banks generally pay generally outpaces what banks pay on lower rates on interest-bearing accounts.
SECTION 2 “ “It was character that got us out of bed, commitment that moved us into action, and discipline that enabled us to follow through.” Z IG Z IG L A R American author and motivational speaker Building » The third thing you save money for is building. 23 » is the key ingredient when it to 24 wealth building. » Building wealth is a , not a sprint. 25 JOURNAL QUESTION: 2.2 Why do you so many people borrow money for large purchases instead of using a sinking fund? to Start Saving? Read These Bank Tips First! * REMEMBER: The emergency fund is not intended to grow wealth, so interest earned is not a factor. » A bank is one of the safest places to keep your money. Since the financial crisis of 2008, the federal government (Federal Deposit Insurance Corporation or FDIC) increased the level of insurance on bank accounts to $250,000 per depositor. » An interest-bearing account is an account that generates interest income on the available balance in the account. » The convenience of a bank account comes at a cost. Banks generally pay lower rates on interest-bearing accounts than financial institutions that offer accounts that resemble bank services: The most common are brokerage cash management accounts, credit union accounts, and mutual fund money market accounts. » Inflation can eat up the interest you earn on an interest-bearing bank account. Even a low rate of inflation (a persistent rise in the cost of goods and services or the decline in the purchase power of money) generally outpaces what banks pay on interest-bearing accounts. W
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