Beret (Bourree) Lam
speaker
435 appearances
6 recordings
1 series
first heard Apr 2020
last heard Jan 2024
Beret (Bourree) Lam’s voice in public audio — every appearance, attributed to the second.
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Appearances
So with tax refunds, that's one thing that personal finance, we usually talk about in terms of unexpected money coming in the door, like I've overpaid my taxes and now I'm getting a little bit back.
What should I do with it?
And most experts will say save it, like add that to your emergency fund or add it to your retirement fund or add it to some other kind of
savings vehicle instead of spending it on like a vacation or something extra for yourself or divide the money, spend a little bit on the special thing you've been planning and hoping for, and then also save some of it.
That's the conventional wisdom.
But right now, we're not in a time where that conventional wisdom is very helpful to most people.
A lot of people are expecting their economic circumstance to change as the fallout from the coronavirus pandemic keeps hitting the economy.
Some are expecting to get sick, possibly.
Some are expecting maybe job loss.
And so saving it in those times is probably not what's real for most people.
They probably have to spend that money to keep their lives going.
why is it wise to keep the money in cash as the situation i was just describing if you are say your economic situation changes and you have to pay the rent you don't want to lock that money up somewhere where you can't access it what you want with your stimulus money if it's a way for you to stay afloat is that you're able to access it so you want it to be in liquid form as they say it you want to keep your liquidity so that you can use it when you need to use it
One economist I talked to, Jonathan Parker, who is a finance professor at MIT, he studied the financial stimulus payments of 2001 and 2008.
And what he found was that most households ended up spending 50 to 90% of their 2008 stimulus payments in the first three months.
meaning households needed this money to do what they had to do with it and so typically for these households you want to imagine that that's what they need is that they will spend it in the first three months so you don't want to lock it up in say stocks or you don't want to lock it up in your retirement account where you
Right now, you're not penalized for withdrawing because of the stimulus bill, but it's a couple more hoops to go through to access that money.
You want to be able to access it the day of or in the event that you put in a high yield savings account, maybe a couple days after.
Either way, you just want to keep it in a place where you can access it so that when you need to spend it on those essential expenses, that you're able to do that.
It's April 1st, and who knows how long this will go on for.
May 1st is also just around the corner where bills are due and rent is due.
Showing 401–420 of 435 · page 21 of 22
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