Smart Money Podcast: Fake Reviews and Saving ‘Too Much’

Liz Weston, Sean PylesSep 14, 2020

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Welcome to NerdWallet's Smart Money podcast, where we answer your real-world money questions.

This week’s episode starts with a discussion of fake online reviews and how to find trustworthy buying advice.

Then we pivot to this week’s question from Kyle. He says, "Is it a bad idea to save too much money? Recently, my family and I were discussing my savings and my older sibling was concerned that I am saving too much. I'm 25 years old and make $32,000 a year before taxes. I have my paycheck set up to auto deposit 8% to my 401(k), 8% to my Roth IRA and a flat $500 per month to an account I pay my rent from. And finally $250 per month goes into my high yield savings account. My sister pointed out that I may want to keep more of my money liquid instead of almost 30% going into accounts I don't touch. Should I lower my monthly contributions to retirement for now given I'm so young so that more of my money is liquid?

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Too many people avoid saving for retirement because they think their money will be inaccessible should they need it. In reality, you typically have a few ways to tap your retirement funds in an emergency, although it’s usually best to leave the money alone to grow if you can.

Saving 15% or more of your income for retirement, starting in your 20s, is a great idea. Your expenses tend to rise as you age, so there may never be a better time to start a significant savings habit. Plus, the later you start for retirement, the harder it is to catch up. Our  can help you figure out how much you need to save.

Saving for emergencies is also important, and we have a for that, too. It’s best to keep the money in a safe, accessible place. You don’t want to risk emergency funds in the stock market, but you can earn more interest by using a .

If you’re trying to figure out how to save more, consider checking out one more calculator: the . This budget can help you find the right balance among needs, wants, debt repayment and savings.

Figure out how much you should save. The 50/30/20 budget tool can help.

Earn interest. High-yield online savings accounts pay better than traditional banks.

Don’t go overboard staying “liquid.” Keep emergency savings accessible, but don’t avoid retirement funds because you think you won't be able to access the money — you can.

Have a money question? Text or call us at 901-730-6373. Or you can email us at . To hear previous episodes, return to the

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