By Toma Lynn Smith
Having money saved can help with financial plans and the unexpected.
Rhetoric and Composition Ph.D. candidate and Graduate Teaching Assistant Carrie Wright said she has no money saved currently. She did at one time and used her savings for her wedding last fall.
Whether it be for yourself or for you and your mate, money saved can make a sudden financial emergency, or a large financial expense easier to deal with.
Wright’s husband, Kristopher Anderson, a communication senior and program assistant within the English graduate department, has both personal savings and a 401(k) which “is a type of retirement plan that allows employees to save and invest in their own retirement,” according to Fidelity Investments Institutional Services Company.
Anderson is enrolled in the University of Louisville 401(k) plan and they match his contributions. This money is taken from gross pay before taxes are deducted. Fidelity stated, “The federal government established the 401(k) in 1981 with special tax advantages, to encourage people to prepare for retirement.”
Most U of L students may not have been here in 1981, but this program is worth joining for the new generation.
Mark T. Lamkin, founder and owner of Lamkin Wealth Management and a former competitor in the popular reality show “The Apprentice” in 2005, said, “Make it automatic.” Deductions from your paycheck can be set up automatically to put money into a 401(k), and he said you won’t miss it. If a company does not offer a 401(k) program, one can be set up at a financial institution such as a credit union.
Like Anderson, who in addition to putting money into his retirement plan by his employer, also has a personal savings, which may be more realistic for a college student to have.
Many banks allow you to open a savings account with as little as $50, such as National City Bank. Lamkin said it is imperative to save early. He started saving and investing at 21 years of age, and is presently living very comfortably at age 37.
On the front cover of Money Magazine, the January 2007 issue stated, “Are You On Track?”
The article by the same title explains how many people are not where they want to be financially while offering statistics as well as suggestions for what needs to be done to get ahead financially.
It stated that a person, who starts at the age 40, would have to save $2,164 a month with a 6 percent return in order to be a millionaire by age 60. Not that everyone’s goal is to be a millionaire by this, or any age for that matter, it may be needed as inflation increases and the sources of income decrease, from lack of good paying jobs.
For example, “Money” stated that in 1976, a million dollars could buy 26 homes and now it can buy four-and-a-half homes. It pays to save now to have money for the future, as funds may not stretch as much as they did before.
Pat Rudolph, an investment representative with Brecek & Young Advisors Incorporated, said, “Many think Social Security may help them when they become elders, but it was never meant to be the only income for those who reach the golden years.”
Toma Lynn Smith is a junior majoring in English. E-mail her at [email protected].
