What is the best investment for saving money?

Question

Im trying to stop living check to check and im ready to save but my saving account is just to slow.

Answer 1

savings accounts are just one of the tools that you need to use. They are great for accumulating funds, but not much good for making money. I really do not know the best investment. I do know some good ones though. The investment that would be right for you would depend on the amount of risk you would like to assume. For many people a mutual fund or several different mutual funds are an excellent way to invest. There are thousands of different ones and hundreds of different types. One of my favorites is sold by Royce Funds. It is PENNX. They have a site on the internet where you can learn more about them. I believe they have a minimum investment of $2000. American funds does not have such a high minimum, only $250 but it does have a front end sales charge of 5.75%. That is offset somewhat by very low expenses. You can find them on the internet also.

There are also index funds that are traded like stocks. You can buy them by opening an account with Sharebuilder.com. They charge $4.00 per transaction.

Here is a site where you can find out all about the different ones available.

http://www.etfconnect.com/

There is risk associated with investing in mutual funds. You need to be aware of that. Some years they actually loose money, but if you are patient over the long term they tend to average about 10% annual return. Some do much better and some not so good. CDs only currently average about 5%.

Answer 2

The old pay yourself first rule is always a good one. It's the best way to become a millionaire (then you'll definitly not live check to check).

Take 10% of your paycheck (every paycheck) and deposit it into mutual funds. You can try Fidelity or Vanguard (I like the company "American Funds" the best).

Sometimes it is difficult at first to dicipline yourself to this system, but after a few months you won't even miss the extra money and your investments will have a chance to grow.

Answer 3

nothing in a bank will keep you from losing purchasing power after taxes & inflation. Have to stick the toe in the market. If have an IRA stick a classic like ADX, close end investment company that is like a cheap mutual fund for large cap stocks, in there. If no IRA - get 1 ;)

Answer 4

ETFs.