How to Protect Your Money

How do you protect your hard-earned money? Is it residing in a checking or savings account? Is it stuffed into a mattress inside your house? What would happen to you if suddenly you realized that your wallet or purse had been stolen or that someone broke into your home and took your mattress?

As you work to grow your wealth over time, it is important to plan ahead for unforeseen tragedies that could impact your financial infrastructure. For instance, what would happen if someone stole your debit card or robbed you while you were withdrawing money from an ATM? Would you be able to recover quickly? My advice is to open free checking accounts with several of the leading, FDIC insured, financial institutions (at least three of them.) Look for free checking accounts that do not have fees or minimum balances (they do exist.) These accounts may not have tons of perks, but all you need is for someone to hold your money and you also need a quick and easy way to make deposits, check your balance online, and withdraw from it. Confirm that the account includes "fraud protection" so that if someone does manage to spend your money without authorization, you will be covered 100%.

Plan to start separating your paychecks and set aside some money to put into each of these accounts. It does not have to be a huge amount of money. Every little bit helps. Do not spend any of the money that you put into these accounts unless you have a terrible emergency and withdrawing money from them is your last resort. Be sure to only carry one or two of these debit cards with you and lock the others up in a safe place where they will not easily be found.

Another idea is to give yourself an "allowance" with each paycheck and deposit this money into one account that does not hold the majority of your earnings. Make this the only debit card that you carry with you. That way, if someone steals this card, they will not be able to withdraw all, or even most of your money. Whatever you do, be sure not to have your PIN number in the same place with your debit card.

Check your balance for each account at least weekly or more often and be sure that there are no strange transactions that you have not authorized. Opt out of having the paper statements mailed to your home for these accounts so that they are not accidentally sent to the wrong place or opened by the wrong person. Also, be sure to periodically check your credit report to be sure no other accounts or loans have been opened without your permission.

Over time, hopefully, you will see the balances in each account begin to increase to the point where you have as much in each account as you started with in your main account. This is possible through determination and a little self-sacrifice. If something bad happens and one of your accounts is compromised, you will still have the means to pay your bills and continue to function while your financial institution investigates your claim and helps you to recover your lost money. You may find, at some point in the future, that you have saved enough money in one of your accounts to begin investing the money or to buy something nice that you've always wanted without having to buy it on credit or put a financial strain on your main checking account. Good luck and be sure to keep an eye on what's yours.

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