It is really difficult to stay motivated to save when savings interest rates keep going down, my IRA has taken a severe beating since October, and prices of food, gas, utilities, etc. are going up.
ING rates dropped to 3.10 per cent and the old savings account is not making a lot of progress now.
How do you keep your focus when it all seems to be going downhill?
Loosing focus
March 11th, 2008 at 10:49 pm
March 11th, 2008 at 10:55 pm 1205276101
March 12th, 2008 at 12:25 am 1205281555
In times like these, it is more important than ever to stay on target financially... because the margin of error is growing thinner and thinner still....
March 12th, 2008 at 01:04 am 1205283873
March 12th, 2008 at 04:28 am 1205296114
Sometimes its not about the return ON investment but the return OF investment.
You're making less interest, but at least your principle is safe.
March 12th, 2008 at 05:23 pm 1205342596
What does this do? The first thing is that you are selling some of your winners to buy underperforming asset classes.
If we broaden this example to bonds and money market accounts (less risky investments), the movement in the markets might have changed the amount of risk we initial thought. An example of this is that we have two asset classes in our portfolio: US bonds and US stock. We start with a mix of 80% stock and 20% bond. The market takes off like in 2000. We may find that we are now 90% stock and 10% bond. Our portfolio has just become riskier then it was before.
What I am doing is looking at the allocation of portfolio and rebalancing my allocations.