Bank Deal: Earn 1.00% APY on an FDIC-insured savings account at Barclays Bank.
Unless you’ve had your head buried in the sand, you’re aware that United States financial system is in the midst of an ever-worsening crisis, and that the stock market has gone a bit haywire. In fact, we experienced the largest single-day drop in the stock market since the markets re-opened after the September 11th attacks.
Why? Because Lehman Brothers (LEH), an investment bank that pre-dates the Civil War, filed for bankruptcy over the weekend. Moreover, Merrill Lynch (MER) was taken over by Bank of America (BAC), American International Group (AIG) is reportedly on the cusp of failure, and Washington Mutual (WM) is still struggling to avoid failure.
What this means for us
Other than the fact that our investment accounts have taken an absolute beating, we’re trying not to sweat things too much. The money that we have in the stock market is intended to be there for the long term so, thus far, we’ve only experienced paper losses. Our investments are all automated, so we’re just going to keep on keeping on. Our retirement contributions go in on the 1st of the month and our non-retirement investments taking place on the 15th.
As far as “regular” savings goes, we have a couple of online savings accounts that are held at relatively healthy, FDIC insured banks. We also have a few CDs at PenFed, which is an NCUA-insured credit union. In both cases, we’re safely below the insurance limits, so nothing is really at risk.
What about you?
How are you reacting? Have you changed your investment strategies over the past few months, or are you staying the course? If you’ve made changes, what are you doing differently, and why? Are you trying to load up while the market is down? Or are you getting out in a panic?
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