Saving vs. Investing: How to Know When You’ve Saved Enough Money and What to Do Next
The Table with Anthony ONeal
Anthony O'Neal breaks down the critical difference between saving and investing, emphasizing that beyond a certain emergency fund threshold,
Key takeaways
- Inflation erodes the real value of money sitting in low-interest savings accounts, even if it's 'safe'.
- The ideal emergency fund is three to twelve months of net pay depending on income stability and dependents.
Main topics
- Emergency fund sizing
- Inflation and idle cash
Notable quotes
"Your money should be working for you and harder than you for more money."
"If your savings account is earning less than 1%, you're literally donating money back to the bank."
Conclusion
After establishing a properly sized emergency fund in high-yield accounts,
Transcript preview
Speaker 2 (0:00) The generation before us used to always tell us growing up, save your money, son, save your money, daughter. But can I tell you the truth where that generation failed us? They never taught us what happens after we've saved enough. And that gap is costing us, my generation, thousands of dollars a year. And I believe it's about to cost you thousands as well if nobody tells you the number. If you have, let's say, $5,000, $10,000, $15,000, and even some of you all may have six figures sitting in your checking account right now, feeling proud about that cushion. Well, today's episode, I'm going to show you why that pride might be costing you Speaker 1 (0:52) some money. Speaker 2 (0:54) There's a number where safe turns into unwise, safe turns into stuck. And by the end of today's episode, you'll know what that number is for your life and exactly what to do with everything that is above it. Being back in school has taught me to make sure that I properly do the research. And while I was doing my research, a 2025 bank report found that 60 % of individuals in America cannot cover a $1,000 emergency. But there's another group. And if you're watching this, it might be you. There's another group of people who did the opposite. They did save. They built a balance of $2,000, $5,000, $10,000, or maybe even more, right? And that's not a problem. I would say that could be a win. But here's what nobody taught us. We learned save your money. Nobody taught us what to do once we've saved enough. So people just kept stacking cash that that's doing nothing while life is getting more expensive around us. I want to give you five reasons today. Very first reason we should come up on the screen is your cash is sitting idle. The real emergency fund number. I would say the insurance limit almost nobody checks and confirms. What a big balance does to your decisions and the real difference between saving and building. Speaker 2 (2:27) Listen, if you have not subscribed to today's or not to today's, but to the channel, this is exactly the kind of conversation we have here at the table. So do me a favor. Hit that subscribe button. Share today's episode and let's get into it. Inflation is averaging right about two to four percent this year. Speaker 2 (2:50) OK, I'm going to use 3%. If $10,000 sits in a regular account, a regular account earning close to nothing, it loses roughly $300 of real value in a year. Listen, nobody stole it. Nobody took it from your bank account. Everything around it just got more expensive while it stayed still. You wouldn't hire someone, pay them full salary and let them sit in the break room doing nothing. But that's what a lot of us are doing with our cash today when it's just sitting in a regular account. I have one condition first, though. This only applies once you are, I would say, consumer debt free. No investment is going to beat or no investment beats guaranteed 25 % credit card interest working against you. So debt-free, consumer specifically debt-free, is always going to come first over here with your boy Anthony O'Neill. But let's just say you are consumer debt-free and you're letting a large balance sleep out of habit. That lazy employee is costing you more than you think. And when I say lazy employee, I'm talking about your money, because remember this, your money should be working for you and harder than you for more money. So I want to give you some things on what I believe you should actually do about it. Now, before we get there, if your money is sitting in a regular savings account right now earning, let's say, point zero one percent, that's not saving. That's slowly losing to inflation with a false sense of security. I need you to get a high yield savings account that can pay 10 to 15 times more. Same FDIC insured protection plan. This is exactly the fix for lazy employee, quote unquote, called money. All right. So a matter of fact, check out this quick commercial. Listen, family, if your savings account is earning less than 1%, you're literally donating money back to the bank. You see, traditional savings accounts are paying pennies. while high-yield savings accounts are paying dollars. And the gap is costing you real wealth every single year. I want to get real with you here real quick. On $10,000, a regular bank might pay you $40 a year, but a top high-yield savings account, that's $400 to $500 a year just for moving your money. That's hundreds of extra dollars in your pocket. No extra work, no risk, and your money stays safe and... FDIC insured. Nearly one in four Americans have zero emergency savings and most who do are missing out on free money by leaving their cash and lazy accounts. The high yield savings account is the fastest, simplest upgrade you can make to hit your emergency fund and short-term goals faster. So listen, stop letting your hard earned dollars stay lazy. Visit anthonyoneal.com for