interest | Online Savings Blog

Milton Friedman vs. Your Wife: Who Gives Better Financial Advice?
07.01.08 | Money | 0 Comments | by junger

If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!
Freakonomics author Steven Levitt posts today about the best personal finance advice he ever received:

When I was a first-year assistant professor at the University of Chicago, my friend and department chair, Jose Scheinkman, relayed the advice Milton Friedman had given him 20 years earlier, “Don’t save too much.”

The logic was simple: An academic’s salary rises steadily over time, as do outside opportunities — like writing popular economics books! The right reason to save is so you can even out your consumption. When times are good, you should save, and when times are bad, borrow.

Most likely, I would never be as poor again as I was starting out. That meant I should have been borrowing, not saving. I didn’t follow the advice as fully as I should have, partly because my wife insisted we save — she is not quite as good an economist as Milton Friedman.

Of course, most of us would agree that saving is important all of the time, but especially when you are starting out.

The best comment to support that, posted by donw, channels another pretty smart guy:

Your wife (and Albert Einstein) - COMPOUND INTEREST!

The earlier you start, the more you'll have.

Plus, your wife always wins every argument anyway.
6% APY Online Checking: Too Good to Be True?
03.12.08 | Online Finances | 2 Comments | by junger

I was pointed today to the "Maximum Earnings Banking" account from Southern Community Bank and Trust, which says it has a 6% APY — basically unheard of these days, especially with all of the rate cuts of the past few months.

Wow - that sounds pretty good. Online bill pay, no maintenance fees, no minimums, and national ATM use.

So what's the catch?

You have to use your debit card at least 10 times per month (not a problem for me, since I use it for everything). You need direct deposit (always a good idea), $100 to open and use e-statements instead of paper ones.

Honestly, I'm not sure if any of those really classify as catches.

But call me skeptical — something doesn't seem right.

Does anyone use this bank and trust? Can you share your experiences and whether or not you recommend it?

free website hit counter