I recently started dating someone, and the topic of finances came up. I found out that she makes good money, and lives below her means. However, she was proud of the amount of money she has saved in her savings account - that she wants to eventually save up for a house, but I also found out that she has CC, student loan, car loan debt, and has never contributed to her 401k (even to get an employer match).
After a short time, I convinced her to pay off her CC debt in full, pay down her student loan debt with more payments, and I set up her 401k for her (contributing up to her employer match and choosing the lowest cost funds with the appropriate stock/bond ratio for her age).
But she's still hung up on the idea of maximizing money in her savings. I explained the idea that inflation is whittling those savings down ever year 2-3%. She explained to me that she has no idea how to invest, and is afraid of the risk. She was also scared of locking her money away in her 401k until she is 65, when she may need it sooner.
She makes some fair points. Naturally I gave her this website as reading material, and a few others. What are some ways I can explain the consequences of her only putting money in her savings account?
Submitted July 03, 2017 at 02:32AM by son_goku17 http://ift.tt/2t7W06l
