Use it or lose it?
Question: The APY on my credit union savings account is only 1.51%. Since this is >far below current inflation, I am actually paying them to borrow my >money, and my balance is worth less and less each day.
>Looking at Bankrate, >
>Meanwhile, inflation is 5.6% >
>Is there some safe place to put my money where it will not shrink, and >still be available on a few weeks’ notice?
>Or should I just blow it on a vacation before inflation eats it away 
Answer: When I had a mortgage and found myself with extra cash, I’d make extra payments against the mortgage. I also had an open home equity line of credit so if I needed money quickly, I could get it immediately at a favorable, tax deductible rate. I rarely needed the equity money, so I was able to place my extra cash into the mortgage, effectively saving about 6% – better and safer than most any investment / minimizing money in al ow interest savings account.
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Filed under: Home Equity Loan
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