Intro to Saving
Building a Rainy Day Account
OK, got it. Save for emergencies first and then start putting away money for everything else. But how much do I need in my rainy-day account?
There’s no magic number, but a good place to start is to accumulate enough money to pay for a month’s worth of your basic expenses.
What’s the primary purpose of a savings account?
To maximize your rate of return
To minimize taxes
To save for retirement
To save for a rainy day
Where should people save their money for a rainy day?
Under their mattress
A retirement plan
A bank account
A pre-paid gift card
How much money should you have in your rainy-day account?
A week’s worth of expenses
What’s a rainy-day account?
A month’s worth of expenses
A year’s worth of expenses