Today’s Prep:

Do you have money sitting around without a purpose? We’ll explain the dangers of lazy money, why people have it, and how you can put it to work! Make your money work for you as you plan for retirement.

Equipping Points:

0:46 What Is “Lazy Money”?

• Lazy money is money that isn’t working; it isn’t making money or doing anything for except existing.
• Money markets and savings accounts are considered lazy money.
• A lot of people think they need liquidity for a rainy day.
• There are three basic things money can do for you and you only get to pick two: safety, liquidity, and growth.
• Liquidity changes when you get closer to retirement.

4:33 Why Do People Have Lazy Money?

• Aside from an emergency fund, some people lack a financial plan to give their money purpose.
• In 2008, people got burned. Now they’re scared to put their money into the market.
• You need to have a balance between risk and safety in your portfolio.

6:25 How Do You Put Lazy Money to Work?

• There are three worlds of money: safety, growth opportunity, and linked. Each world consists of certain products, services, and companies.
• In safety: banks, government, and insurance companies.
• In growth: mutual funds, stocks, bonds, real estate investments, and variable annuities.
• In between those two worlds is a linked world that features instruments that focus on protection but are linked to growth. There are restrictions on what you can do with this money, but it’s a way to put your lazy money to work.

Today’s Takeaway:

“There are three basic things money can do, and you only get to pick two: safety, liquidity, and growth. – Eric Peterson“