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7. Regular savings programs and paying yourself first What's the best method for organizing your saving activities? Virtually all financial analysts agree that it is best to: Start saving early Save regularly. Shift to another savings goal and a higher yielding investment when you achieve a particular savings goal. Sometimes the most difficult question is, "How do I get started and how do I maintain my momentum?" One of the easiest answers is, "Save regularly and pay yourself first." What do you think it means to pay yourself first? It means making your saving activities your first priority by paying yourself, or making contributions to your savings accounts any other obligations you pay One way to pay yourself first is to O make your savings contribution only if you have something left over after you pay all of your other bills. have your savings contribution automatically withheld from your paycheck and directly deposited into your savings account. The advantage of this saving strategy is that it The advantage of this saving strategy is that it O ensures that funds remaining after paying all bills and making impulse purchases will be saved. O ensures that funds will be saved-as opposed to saving only if sufficient funds remain after all other bills are paid and any impulse purchases are made. Therefore, paying yourself first imposes financial on the act of saving It is recommended that one of the first goals of a savings program should be the accumulation of an emergency fund equal to three to six months' worth of living expenses. Let's examine this savings objective further What is the purpose of an emergency living expense savings fund, and what other sources of funds are sometimes used to address these needs? This fund allows you to cover a household's O living expenses in the event of a job layoff, illness, injury, or the premature death of an income generating member of the household. O expenses incurred during vacations, holidays, and birthday celebrations. However, most people don't maintain an emergency living expense savings fund; instead, they expect to rely on their credit cards to pay their living expenses during these expensive and stressful events. The downside, or negative consequences, of this strategy is that it their wealth since it involves the payment, rather than the receiving, of What type of savings vehicles should be used to store your funds? This fund allows you to cover a household's living expenses in the event of a job layoff, illness, injury, or the premature death of an income generating member of the household. O expenses incurred during vacations, holidays, and birthday celebrations. However, most people don't maintain an emergency living expense savings fund; instead, they expect to rely on their credit cards to pay their living expenses during these expensive and stressful events. The downside, or negative consequences of this strategy is that it their wealth since it involves the payment, rather than the receiving, of What type of savings vehicles should be used to store your funds? Which of the following are the factors that should be considered when identifying appropriate savings vehicles? Check all that apply. The length of time you would need to use the savings. The level of past interest rates Your preference of higher risk and higher returns or low risk and low returns. If you expect interest rates to decrease in the near future, then you should invest in investments so that you can O lock in the higher interest rates before they decrease. O reinvest quickly when interest rates increase. ar savings goal. entum?" One of the easiest answers is, "Save regularly you pay utions to your savings accounts after before after you pay all of your other bills. check and directly deposited into your ulse purchases will be saved. icient funds remain after all other bills are paid 9. Une yvus suvirry WELTWUCIR Vy yurusu Managing Your Cash and Savings O have your savings contribution automatically withhela savings account. The advantage of this saving strategy is that it O ensures that funds remaining after paying all bills and making O ensures that funds will be saved-as opposed to saving only if and any impulse purchases are made. Therefore, paying yourself first imposes financial It is recommended that one of the first goals of a discipline should be the accumulation worth of living expenses. 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This fund allows you to cover a household's O living expenses in the event of a job layoff, illness, injury, or the prematured member of the household. O expenses incurred during vacations, holidays, and birthday celebrations. However, most people don't maintain an emergency living expense savings fund; instead, they expect t expenses during these expensive and stressful events. The downside, or negative consequences, of this since it involves the payment, rather than the receiving, of What type of savings vehicles should be used to store your funds? Which of the following are the factors that should be considered when identifying appropriate savings ve The length of time you would need to use the savings. The level of past interest rates Your preference of higher risk and higher returns or low risk and low returns. If you expect interest rates to decrease in the near future, then you should invest in ins lock in the higher interest rates before they decrease. long-term O reinvest quickly when interest rates increase. shorte term

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