Monday, March 29, 2010

Weekly Savings Tip: March 29, 2010

Keep Some Investments Liquid

Are you planning a major purchase this year? If so, make sure to keep some of your investments liquid. The liquidity of an asset refers to how quickly it can be converted to cash without penalty. So, if you are planning a significant expenditure, is important to have liquid assets to avoid pulling from a long-term investment or a retirement fund at an inopportune time.Most long-term accounts will penalize you for withdrawing your money too early. Some will take away the interest that you have earned; others will actually dip into the principal that you have invested. Utilize a high-yield savings account, a short-term CD or a money market account to have funds accessible when you need them.