This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Don't Save for Disaster -- That's What Dad's For

When I have advised in previous columns that people in their 20s shouldn't worry about saving money, I'm flooded with hate mail, some of it pretty nasty, some of it well reasoned. After upbraiding me for failing to understand "the magic of compound interest," the point most people make is that people need to save in order to prepare for the worst.

What happens if your car breaks down and you need money to get it running again? What happens if you lose your job and need to support yourself? What happens if you get arrested and need to bail yourself out of jail?

If you get in trouble and need to bail yourself out, the last thing you want is to spend your own money. The best way to avoid that is to make sure you can't afford to fix whatever the problem is. Young people are better positioned to pass off the cost of emergencies than any other group.

I'm sure some of you are saying, "Here he goes again, another facetious column about why you should behave irresponsibly, and this one probably won't even make Page Six of the New York Post."

I assure you, I'm not kidding.

It doesn't make sense to save money in preparation for problems that you may not have to pay for yourself. The person who puts money away for emergencies is giving up opportunities for free money.

Want more? Check out TV video. Cliff Mason tells Farnoosh Torabi why an emergency savings account does you no good in your 20s.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.07 -0.59%
FB $118.08 0.02%
GOOG $698.07 0.34%
TSLA $213.05 -4.30%
YHOO $37.12 3.10%


Chart of I:DJI
DOW 17,699.78 +48.52 0.27%
S&P 500 2,055.71 +4.59 0.22%
NASDAQ 4,728.2490 +2.61 0.06%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs