The Online Investing AI Blog

Graph from Investors.com

For those without jobs and those in positions they can’t stand, the Investor’s Business Daily had some good news… Finally.

According to the Labor Department, the U.S. economy has started to add jobs.

A senior analyst from Barclays, Michelle Meyer, concurs with the assessment.

“Before summer, the recovery should lose its jobless label. By the end of the year, the recovery will feel like a recovery not just to economists but on Main Street too,” she said.

Economists expect the job market will be adding 200,000 jobs a month by year-end.

That’s all great news. But it doesn’t mean anything if we haven’t learned from this.

Read more…

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The Titanic went to sea with more passengers and crew members than there were spaces on lifeboats.

“Why would an unsinkable boat need lifeboats, at all,” some passengers might have thought, considering the long boats nothing more than quaint odes to a bygone seafaring era.

Some investors found themselves in a similar position recently. Mutual funds, hedge funds, and money market accounts would never sink, right?

Well, just like a black swan of an iceberg sunk the Titanic, a flock of them flew into the flight path of the market last year.

If you weathered the storm, good for you, but that doesn’t mean you ditch your personal financial lifeboats. You should always have an emergency fund. Experts differ on the exact sum of the fund, but saving anywhere from three to six months of your salary is a good start. You also want to make sure this fund is in something extremely safe: cash, preferably.

Why do you need to have this emergency fund established. Here are three reasons–and some may seem contrarian.

Read more…

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Recently, George posted a series of articles on why saving money can actually lose you money.

I think they were brilliantly done, but I wanted to offer my own views on savings.

As his posts pointed out, saving can be restrictive, especially if it’s based on fear, like Depression-era folks who buried their nickles and dimes in backyards and tucked them under attic roofs. (And they’re probably still there doing no one any good and not earning interest. In this case, just like George said, these small investments are losing money.)

That doesn’t mean that smart saving–and spending–doesn’t have value. What you need is an attitude adjustment in your approach to saving. Here’s how smart investors approach saving:

Saving Creates Smart Consumers

If you save money, you’re less likely to throw your money on unneeded goods that you can’t afford. You’re less likely to build up bad debt. Smart consumers also force businesses to be smart producers.

Saving Money To Make Money

Saving should be a way to re-deploy and grow your wealth. It’s called investing or trading.

Saving Money Can Expand Your Comfort Zone

I think you should have an emergency fund–a stash of cash on hand. Experts recommend three to six months of expenses. Creating an emergency fund should build your confidence and allow you to take risks to fulfill your dreams.

If you can approach savings–not hording–with an attitude that you’re generating more wealth and making your personal financial IQ a bit smarter, then saving becomes a force of good, not a source of fear in your life and in the wealth-intelligence-starving world around you.

Business Strategy, Dreams Come True, Investing, Online Investing AI emergency fund, horde, invest, investment account, Money, riches, save, saving, wealth