Start Saving and Make Your Money Work For You!

Does this sound familiar?

You wake up in the early morning hours in a panic thinking about how you’ll never save enough to send your kids to college, pay off your house, fix your car and what about retirement?

Whether you’ve saved cash like a squirrel stashes nut or pissed it all away like an out of control crackhead in Miami, money worries don’t have to keep you up at night.

Follow these tips

If you’re a novice, start at the beginning.

If you’re a squirrel and already started stashing money then you’ve probably knocked off a step or two here, so start reading at the point that applies to you.

Step 1: Start Building an Emergency Cash Fund

Your house has sprung a leak and you are heading into storm season. You can't afford to have someone come in and fix the roof. Hell you can't afford to patch the roof right now. The problem is liquidity - or cash on hand. You need to have a rainy day fund or a just in case - because as we all know - if it can happen it will.

The American economy is still weak and money isn't flowing like it was in the early 2000's. Everyone needs to have a cash cushion just in case you are hit with a loss of income or face an unforeseen expense.

Don’t skip this step and use your credit card instead. If you go for plastic you could end up digging a bigger hole than you are trying to patch.

You should begin by taking and setting aside 5 to 15 percent of your income until you have squirreled away enough to establish your emergency fund. Your emergency fund should cover one and a half to two full months of your bare-bones living budget. This bare-bones budget is what you need for basic expenses, such as utilities, groceries, and your mortgage or rent (not your after-work drinks, golf, lottery tickets, cable tv or a Netflix subscription). Each time you get paid, have this money deposited into a dedicated savings account or a money-market account. (Find some of the best interest rates at IngDirect.com and SmartyPig.com, an online bank that focuses on setting financial goals.) And if you think you’ll be tempted to blow your stash on, that awesome new 3D tv with wifi and x-box connect, place this money in an account that isn’t linked to an ATM.

The Money Needs to Be Saved! You have to have liquidity!

Let's move on to step 2: the Retirement building phase