According to this January 29 report from CNBC, based on a survey by American Express, nearly one-third of Americans say that they keep at least some savings in cash. An earlier survey mentioned in the CNBC report found that of those who keep cash in their house, 27% kept it in the freezer.
I have had clients tell me that they keep their estate plan documents in the freezer. I say, as long as someone other than you knows where they are and can get to them if necessary, anyplace where they won’t burn up if the house burns down is fine. With estate plan documents, a safe place is where they won’t be lost or destroyed. Preventing theft isn’t the issue, unlike with case.
As for not keeping your savings in the bank, I can’t say that I blame the 67% of young people who said they keep savings in cash rather than in the bank. They have grown up in an era where there is really no financial advantage to keeping a savings account. When I learned to save, one of the incentives was that the savings earned interest. Although I understand that the whole interest rate thing is very complex, it’s a shame that the younger generation (not to mention senior citizens who relied on interest income from their retirement savings) has been deprived of that incentive to save. I’m sure it has had a negative impact on the savings rate.
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