What do you guys do when you are saving for a specific purpose?
I'm going on a road trip next August, 10 days down the eastern seaboard to Disneyworld, camping most of the way, hitting Philly, Washington DC, Atlanta, Savannah, Charleston, Mammoth Cave National Park, Shanendoah National Park, and going white water rafting for a day. We might even stop by an underground cavern putt putt golf course in Pennsylvania.
The trip will cost something like $800 (at the very most), and it's time to start saving ahead of time for it. What do you guys do when you know you have to save up for something ahead of time? The trip is between me, and two other friends. We were thinking of opening up an HSBC account, an online savings account with a high rate of return (5% at the moment), I talked about it on the saving for retirement thread, briefly.
If the three of us kept funneling money into it, over the next 8 months, it should give us a nice little extra bit of spending money for the trip, but at least that way we're making money on our money, and we're sure it's there for us when we actually need to use it in August.
Any other ideas for saving ahead of time for a specific trip or purpose?
Posted by ElJay (Member # 6358) on :
I would not open up a joint account with friends for a purpose like this. What if one of them has to pull out? What if you have to pull out? How do you decide how to split up the money? What if two of you contribute what you say you will and the third only contributes about half of what he's supposed to? Do you still let him go on the trip? What if one of you has an emergency happen, suddenly needs money, and empties the account? I know you say it won't happen, but it could.
Split up what you each need to contribute, each open your own account, and save individually. Take the amount you need and divide it by the number of pay periods between now and the trip, and put that much in from each paycheck. Then when you're ready to go, the interest will be gravy. And if the trip falls through, you won't have to deal with figuring out how to handle a joint account.
Posted by ClaudiaTherese (Member # 923) on :
What ElJay said. Posted by kmbboots (Member # 8576) on :
I stick some of my cash in a different drawer.
Posted by dantesparadigm (Member # 8756) on :
Flawless logic, and at this point I've seen too many banner ads related to the topic of the thread, they must have some kind of content scanning algorithm.
Posted by Dagonee (Member # 5818) on :
What CT said about what ElJay said.
I use quicken and spreadsheets to set up virtual savings accounts. If it's too difficult to keep track of for you, a separate savings account is the way to go.
Posted by Lyrhawn (Member # 7039) on :
Well, I'm doing it either way, more than likely. The only thing that has me nervous is transmitting my SSN, bank account info and what not over the internet to HSBC, especially with all the identity theft stuff going on lately. The whole online banking thing has me a little nervous.
Anyway, we've already more or less worked out the details of funding. When someone commits to go, they need to pay their portion of the "group" fees, shared costs, by March (we're organizing it like you almost would a school trip). Then if they pull out, we keep that money, but if they have any personal money in there, they get it back, plus their percentage of the interest, if they get any.
It won't be a joint account either, it'll probably be in my name. I trust me not to get screwed over by them, especially if I control it.
Posted by AvidReader (Member # 6007) on :
I don't know HSBC's policies personally, but I can guarantee every bank and credit union in the US takes their security very seriously. We have all kinds of encryption and firewalls and what not. Plus, we've got all kinds of auditors, federal regulators, and watchdog groups looking over our shoulders.
The question is do you trust your ISP? I actually had one that harvested credit card numbers and sold them to another company. There was a nintey year old woman who had never owned a computer let alone used their service who was getting charged. They harvested the info when she bought her daughter an anti-virus subscription. I'm sure they only did it becuase the owner was scum, but other than a local newspaper story about it, no one ever did anything to them. Your ISP doesn't have the same regulation.
If you trust your ISP, you're probably ok. If not, you could see if you can print out the form or use a location you think will be secure like the library or a cafe.
Just remember, if they put money in your account, it's your money. The bank won't let them touch it. Don't abuse that power and lose your friends. Posted by fugu13 (Member # 2859) on :
Transmitting the information to the bank has never been the weak link. So long as you never click a URL supposedly to your (or other) bank from email, you'll be secure from all of the problems with online banking that occur with any frequency.
You're far more likely to have your bank information accidentally distributed to the world or intentionally stolen by compromising something IRL, such as an ATM, and those have nothing to do with whether or not you signed up online: at the bank, its all digital.
Posted by Lyrhawn (Member # 7039) on :
Oh I'm not going to steal their money. And they know it. If they agree to pay a certain amount though, I'm not going to get stuck holding the bag for costs. A commitment is a commitment, regardless.
fugu -
Yeah, I don't think I've ever transmitted this much info over the net before that wasn't at a government site (those aren't bastions of safety either, I know). I do online banking every day, whether it's paying bills or transferring money and what not, so I shouldn't be worried about transmitting the information over the internet. Just a last moment's hesitation before committing myself to something I can only vaguely control through clicks and keyboards.
Does FDIC insured mean that I get my money even if the bank rips me off and steals it or something?
Posted by Mucus (Member # 9735) on :
Off-topic: 5% really? This hsbc?
Posted by Lyrhawn (Member # 7039) on :
Well, more like THIS hsbc.
Posted by Mucus (Member # 9735) on :
Figures, been looking for a better savings account/GIC. Knew that rate was too good to be true.
Posted by Lyrhawn (Member # 7039) on :
I don't know why the Canadian hsbc gives a lower rate than the American one. Sorry Posted by AvidReader (Member # 6007) on :
FDIC means the government covers you if the bank goes under and can't pay you.
We have private insurance to cover robbery, fire, and what not.
I have no idea if there's anything to stop the bank from ripping you off. I've never heard of such a thing. I suppose the only way they'd get caught is if they couldn't give you your money and the FDIC kicked in.
I'm not sure though. The question just doesn't want to process.
Posted by Lyrhawn (Member # 7039) on :
I'm not super worried. I just opened an account there and am going through the verification process, which takes a couple days.
I think someone on the Retirement thread talked about having a similar ING account, so, that, combined with a recommendation from CNNMoney is a good enough for me.
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