How Much To Keep In A Bank?

well typically when you are not living off the money you have two choices . you can invest aggressively for heirs ,charities and fun money or very conservatively since either way it does not matter to your existence
 

Aunt Bea said:
OED, I didn't know that Muslims don't deal in interest. I learned something today, thank you for that!
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In the Bible, loaning at interest is forbidden between Israelites... but allowed with foreigners.

Deuteronomy 23:19-20

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Ruth n Jersey said:
I certainly can't add much info on this because I'm not sure. I can say that I learned my lesson about keeping money in long term CD accounts. The hubby and I were going along quite nicely on our social security checks and a small amount of interest from his retirement fund. Our home is paid for and so far no horrible health issues. In 2000, my Mom passed away and left me an inheritance of a moderate sum of money. Because we didn't need it, and I am deathly afraid of stocks or anything risky, I kept putting it in CD's. Of course the interest dropped to next to nothing so when they matured I put them in a longer term for a better interest rate. I guess I was thinking I would last forever. 3 months ago I needed new hearing aids which were almost $5000.00. This was quite a chunk to come up with all at once. There is a very high penalty for taking the funds early. Luckily a CD matured and I was able to get the money for the new aids. Now I am going to have to figure out what to do as the other two I have mature. I know if I put it in stocks I will never sleep again and the interest rate for money markets is so low.
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If one is going to keep a lot of money in CDs... the expert advice is to "ladder" several different CDs
that expire at various due dates. That way, your money is more readily available for emergencies.

https://www.nerdwallet.com/blog/banking/building-perfect-cd-ladder/

For an IRA CD, one might arrange with the financial institution to pay you the periodic interest...
instead of the interest compounding back into the IRA CD.

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KingsX said:
I'm curious, where do you recommend people keep the other 95% of their money.

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No one should be recommending a thing for anyone else. We should only say what we do or speak in general terms .

what you should do is based on info we don't know . What is your draw rate , your pucker factor , your total situation , is it money you are living on or mostly money for heirs ? There can be a whole lot that is considered as far as what to do with the money.

that does not mean we don't have opinions as far as what you may want to do. As for me I would not hold more than the current years spending in cash instruments. Everything else is in a portfolio of about 40-50% diversified funds and the rest assorted bond funds of all types . Many are less interest rate sensitive today because rates are rising
 
Since retirement, my lady and I have (literally) socked away our savings (in a sock), in spite of spending (to us) some major coins on building materials.

It’s not that I don’t trust banks or savings institutions (I don’t) but that I’ve grown accustom to piling up money…and looking at it, much like Silas Marner.

It’s not much, and will not become more than $40-50K in a couple years.
If I became aggressive and wished to pile up a sum, I’d buy raw land and build cabins on them (and I may), as they’re hot right now..but go thru the aggravation of dealing in stocks or putting money in a bank? What fun is that?
I’ve come to detest financial institution’s/broker’s ways of pestering when I do invest.

We spend little, need little, and hope to leave our offspring a sum to share.
 
Gary O' said:
Since retirement, my lady and I have (literally) socked away our savings (in a sock), in spite of spending (to us) some major coins on building materials.

It’s not that I don’t trust banks or savings institutions (I don’t) but that I’ve grown accustom to piling up money…and looking at it, much like Silas Marner.

It’s not much, and will not become more than $40-50K in a couple years.
If I became aggressive and wished to pile up a sum, I’d buy raw land and build cabins on them (and I may), as they’re hot right now..but go thru the aggravation of dealing in stocks or putting money in a bank? What fun is that?
I’ve come to detest financial institution’s/broker’s ways of pestering when I do invest.

We spend little, need little, and hope to leave our offspring a sum to share.
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I don't like banks either but they are a necessary evil when it comes to automatic pension and SS deposits. We deal with a small local bank that knows us by name when we walk in (which isn't very often).

When I was growing up (in the 50's) my parents never had a checking account and my mother kept most of their cash in a Calumet baking soda tin in the freezer in the basement and she kept the freezer locked . Talk about "cold cash"....haha. They paid all their bills with cash and bought groceries with cash...no checks. It wasn't until my father passed away in '87 that she finally got a checking account. How times have changed. No one wants you to pay with checks any more...let alone cash.
 
Colleen said:
I don't like banks either but they are a necessary evil when it comes to automatic pension and SS deposits. We deal with a small local bank that knows us by name when we walk in (which isn't very often).

When I was growing up (in the 50's) my parents never had a checking account and my mother kept most of their cash in a Calumet baking soda tin in the freezer in the basement and she kept the freezer locked . Talk about "cold cash"....haha. They paid all their bills with cash and bought groceries with cash...no checks. It wasn't until my father passed away in '87 that she finally got a checking account. How times have changed. No one wants you to pay with checks any more...let alone cash.
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Interesting you mentioned that -- Just this last few months I have seen signs at cash registers in stores in which I regularly trade that say "no personal checks accepted." I asked one of the cashiers why, and she said it was due to the increasing number of NSF or fraudulent checks they had been getting. They still take $$$ though.
 
Colleen said:
I don't like banks either but they are a necessary evil when it comes to automatic pension and SS deposits. We deal with a small local bank that knows us by name when we walk in (which isn't very often)
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Oh,I have checking and savings
The savings has a stagnant $1000
The checking is for auto deposit/pay (love that)
and purchase paperless recpts
Haven’t written a check for months, maybe years
I figger one day soon it’ll be called something besides checking
Maybe Otto or Deb or Chip acct
 
credit card companies have been offering business 10k to take no cash .

we charge as much as we can today . the points we get from our credit card strategy is insane . we can get as much as 7% back on different categories. once you start charging everything you can the points can be worth thousands , with out a penny in interest .
 
I pay for everything I can with credit cards. The cash back mounts up and is free money because I never pay interest. Several local businesses around here don't take credit cards though but will take cash or checks.
 
we have a strategy we use with our cards . we have thousands of dollars in points for traveling .

we use the chase trinity . we use the chase freedom , the freedom unlimited and the sapphire reserve card .

the freedom has 5% back categories every quarter , the unlimited pays 1.50% on everything else , the reserve pays 3% on travel and dinning .

however all points can be transferred to the reserve where they get a 50% boost when used for travel through the chase travel site .

the 5% becomes 7% , the 1.50% becomes 2.25% , beating my 2% back fidelity card and the 3% on the reserve becomes 4.50% .

we got the reserve card in october and have 150,000 points for travel already banked .
 
mathjak107 said:
we have thousands of dollars in points for traveling
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Well…now I’m a bit sad…almost.
We just don’t spend enough to get those piles of money
A young gal at the grocery checkout began pestering me on why I don’t have a rewards card.
I said ‘look in my cart, that’s two week’s worth’

Guess she figgered out all my herself toothpaste, some oil, sugar, salt wouldn’t get me much in the rewards dept
 
well we like to travel so we do very well and get our moneys worth for sure . it can be surprising though how much you can charge and how much in rewards you get just on the things you buy daily .
 
mathjak107 said:
well we like to travel so we do very well and get our moneys worth for sure . it can be surprising though how much you can charge and how much in rewards you get just on the things you buy daily .
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guess in the travel dept I consider myself already there
and don't wish to go anywhere I can't get back before dark


I do think you guys are making the economy go 'round
...and appreciate it

'it can be surprising though how much you can charge and how much in rewards you get just on the things you buy daily'

We buy weekly, monthly in winter
stores are 50 mi from the cabin
I did the math
our expenditures just don't get it
 
I pay for everything I can with credit cards. The cash back mounts up and is free money because I never pay interest.......
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Yup. We started that almost 40 years ago. However, it wasn't until recently that we changed the utilities to be paid via CC on an automatic basis. We only have one utility that won't take a cc. Most of our non-travel entertainment expenses (eating out, theatre) is covered by the cash back we get. Plus, it helps with the credit score, which gives us better deals when purchasing a car.
To answer the OP, we keep very little more in the bank than we need to pay for everything. We're usually a good $1500 in excess of what we will take out in a month, just to be sure there are no overdrafts. We use a local bank and go a couple of times a year to get some cash, which we use very little of.
 
unfortunately you have many who think all debt is bad debt and they have a skewed view of using credit responsibly to your advantage. . any time i can get what amounts to a rebate for doing nothing i will do it .

heck chase handed us 1500 bucks in benefits for simply taking a sapphire reserve card and a chase private client account ..
 
>>They still take $$$ though. - Butterfly>>

A small but growing # of retail places in our area are starting to post "no cash OR checks" signs. Especially in marginal neighborhoods, businesses that are open late at night are deciding they don't want the risks to their employees in addition to $$$ losses.

Personally we just let the money flow in and out again. Our pensions/distributions are sent ACH to our checking, and a modest portion then is sent ACH to our savings accts, one of which is for paying property taxes.

The remainder gets spent, either on the usual overhead (utilities, gas for the car, insurance policies, food, etc.) or used for discretionary pleasures like dining out, movies, books/e-books, or travel.

We were focusing on points at Barnes & Noble for a number of years because we buy so many books. As we have shifted to e-books, we are now using our Amazon/Chase card more because it accumulates a cash credit towards Amazon purchases. Since we're heavy Prime users the credit comes in handy (when I remember to use it - one-click and e-book purchases aren't eligible).
 
chase said they lost 300 million last year in 2017 on the sapphire reserve . but they hope to make money this year now that many perks are paid for . the issue they had besides the perks is the customers who take the sapphire reserve don't pay interest .

on the other hand the reserve has increased usage on the other chase cards like we use it . you can get all these points on the other cards , shift them to the sapphire and they get a 50% increase when used for travel .

normally we would have used the 2% fidelity card but using the chase 1.50% back card , moving it to the sapphire gets it a 50% boost

it
 
I keep enough in checking to keep the bank from charging any monthly fees.
I have a savings account with a credit union because they have the best loan rates - my mortgage is with them. And it gives me somewhere local to transfer money from my investment accounts.

If you have money in 'cash' accounts, you can put some of it to use by using it to take advantage of bank account bonuses - some banks pay cash for opening new accounts. You do need to read and understand the fine print. Your money isn't 'locked up' either, if you need it before the bonus is earned or payed, you just don't get the bonus.
 
Colleen said:
My husband is 77 and I just turned 71. We have been retired since 2001. We had investments way back when but lost most of it in 2008 when everything went down hill. Since we've been living on his pension and our SS we haven't re-invested because we're afraid of losing it again. We didn't buy a house until we were in our 50's because his work kept us moving around so we're still making a house payment and a car payment. After monthly bills are paid (usually no credit card debt) we have about $1500 that I am able to keep around with $500 in cash and the rest goes in a savings with Ally, which is earning interest over 1% right now.

I've thought about mutuals but isn't it a little late for us to start investing since it takes forever to see a return?
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I also didn't lose any money in the 2008 crash...in fact took a distribution with profit (not loss) from one of my funds. My average annual returns have been around 14% give or take, with one year since being at 24+%. It's never too late to start investing IMHO but choose investments that have a track record of doing well over 5 and even 10 years. Right now I'm favoring exchange traded funds (ETFs) for my new investments because each holds a bundle of companies like mutual funds but trade like stocks in that you don't have to buy any particular dollar amount of shares at once and you can see real time share price quotes throughout the day. I also favor Schwab as a brokerage because many of the funds, ETFs are on their list of fee free trades. I also find their website to be very user friendly, including their "research" feature that gives detailed rundowns on each fund or ETF by rating, returns, holdings, etc. I hope you and your husband can see your way to getting started and have much success.

Regarding your reply about checks and cash...I believe checks are all but obsolete, what with credit and debit cards being so handy. Most months, I only write one check a month and that's for our carrying charges (co-op speak for HOA fees). If the managing agent ever installs a method by which we can pay be credit card, the only checks I would write would be to enclose in sympathy or birthday cards. My mother had a checking account but I don't remember how long she had it.
 
Gary O' said:
Since retirement, my lady and I have (literally) socked away our savings (in a sock), in spite of spending (to us) some major coins on building materials.

It’s not that I don’t trust banks or savings institutions (I don’t) but that I’ve grown accustom to piling up money…and looking at it, much like Silas Marner.

It’s not much, and will not become more than $40-50K in a couple years.
If I became aggressive and wished to pile up a sum, I’d buy raw land and build cabins on them (and I may), as they’re hot right now..but go thru the aggravation of dealing in stocks or putting money in a bank? What fun is that?
I’ve come to detest financial institution’s/broker’s ways of pestering when I do invest.

We spend little, need little, and hope to leave our offspring a sum to share.
Click to expand...

I sure hope you never have a fire Gary!! You are not alone in your distrust of banks. I read an article last year about the places people stash their cash. In a sock wasn't one of them. :D I also pay with practically everything with credit cards (see my reply to Colleen). I've made thousands of dollars as well. Last year, including the bonuses for accepting pre-approved offers, I made about $1,100 in cash back rewards. Hey that's almost $100 a month. Not going to turn THAT down. And I don't buy stuff just to get rewards, I charge what I would normally have written a check for, groceries and things I truly need. I also never pay interest or fees so those rewards are "free and clear".
 
OneEyedDiva said:
I also didn't lose any money in the 2008 crash...in fact took a distribution with profit (not loss) from one of my funds. My average annual returns have been around 14% give or take, with one year since being at 24+%. It's never too late to start investing IMHO but choose investments that have a track record of doing well over 5 and even 10 years. Right now I'm favoring exchange traded funds (ETFs) for my new investments because each holds a bundle of companies like mutual funds but trade like stocks in that you don't have to buy any particular dollar amount of shares at once and you can see real time share price quotes throughout the day. I also favor Schwab as a brokerage because many of the funds, ETFs are on their list of fee free trades. I also find their website to be very user friendly, including their "research" feature that gives detailed rundowns on each fund or ETF by rating, returns, holdings, etc. I hope you and your husband can see your way to getting started and have much success.

Regarding your reply about checks and cash...I believe checks are all but obsolete, what with credit and debit cards being so handy. Most months, I only write one check a month and that's for our carrying charges (co-op speak for HOA fees). If the managing agent ever installs a method by which we can pay be credit card, the only checks I would write would be to enclose in sympathy or birthday cards. My mother had a checking account but I don't remember how long she had it.
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What REALLY scares us away from doing any kind of investments right now is the uncertainty of our Medicare and SS. Trump and his henchmen are going to do something to lower our "entitlements" but no one is saying for sure what that will be, soooo......we're sitting tight right now just in case we need to have a "cushion" for anything unforeseen. I am envious that we didn't get started sooner with a "plan" to invest while we worked and should have bought a home much sooner than 56/50 years of age.It sure would have helped to have that house payment we're making now to put away somewhere :( The trouble with parents then and now is they don't talk about or teach finances with their kids. Money is always such a private thing that it's never discussed and when you get out on your own, you're left to flounder.
 

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