How much money should I keep in a savings account for emergencies?


Question: How much money should I keep in a savings account for emergencies?

Answer:  Many financial professionals suggest that you put away three to six months’ worth of living expenses for emergencies. We actually call these funds “Cash Reserves,” because the reality is, most things that might happen are not really emergencies. Once established, we also refer to this as your “sleep well at night” account!

If you lose your job, or become disabled and don’t have adequate disability insurance, you’ll need that money to pay your regular monthly expenses, such as mortgage payments, insurance premiums, groceries, and car payments, until you can find another job. Without such an emergency fund, a period of unemployment could put your assets at risk. Similarly, if your car breaks down or your spouse has a medical emergency, you’ll want to have the necessary cash to pay the bills. You don’t want to be faced with an immediate need for cash, only to discover that you don’t have any.

You may have already set up an emergency fund. Did you put the cash in a five-year certificate of deposit (CD) or other long-term investment? In an emergency, you will need to get at those funds immediately. You can certainly pull your money out of the CD early, but you’ll pay a penalty. It’s better to keep some funds more liquid, in a traditional savings account, a money market deposit account, or a six-month CD, for example. That way, the cash will be readily available when you need it.

Finally, keep your emergency fund separate from your everyday accounts. You might even want to use a different bank. Unless you are extremely disciplined, you’ll be tempted to spend those extra funds if you keep them in your checking account. Remember, if you can put off an expense until next week, it is probably not an emergency.

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How To Use Leverage When Owning Real Estate

Learn what leverage can do for you when you own Real Estate.


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The #1 Mistake Home Buyers Make

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Debt Happens – It’s How You Repay It That Matters


Whether it’s your mortgage, money owed for home improvements, car loans, student loans, or last months’ vacation still on your credit card, most of us have debt.

Debt comes and goes.  You pay off everything, and then decide to remodel your kitchen.  Your paid-off car finally breaks down and you need to get a new one.

Debt is a part of our lives.  But having debt is not necessarily the problem.  How you pay back your debt is what counts.

With that being said, do you have a DEBT REPAYMENT plan?  Everyone wants to be debt free…but rarely do they have a specific, measurable, and actionable plan to achieve this goal.  And without a plan, goals can rarely be achieved.

So what can you do about this?imageedit_1_9586870040

With the new release of my book, Borrow Smart, Repay Smart, I figure it’s time to remind everyone that our Mortgage Advisors are trained on a custom process designed to help homeowners create a plan to get out of debt faster, and easier.  It’s called The Repay SMART Review™.  You can schedule one by emailing your preferred Mortgage Advisor at Sierra Pacific Mortgage. It’s that simple.

Some of the answers this process will provide are:

  • Where should you start? Meaning, which debts should you attack first, and which debts should you just pay the minimum?
  • How do you balance your goal of paying down your debt AND putting money into savings?
  • Do you focus on the highest interest rates or the lowest balances first?
  • How do you reduce the net cost of your borrowing over time?
  • Should you pay extra toward your mortgage, or save that money instead?
  • And the best one…what’s your DEBT FREE DATE?

We do NOT charge for this service.  It is COMPLETELY COMPLIMENTARY.  Why?  Because we believe that it’s part of our responsibility to help you better manage your debt and find ways to free up cash flow to save more for your future.  It’s one way we give back, and it gives our career a purpose far beyond handing out mortgages.  So there are no hidden strings here.  It’s what we love to do!

And yes, when we do this well and give back in this way…people do tend to choose our Advisors for their mortgage services when needed.  But it’s up to you to take action.  It’s your debt.  It’s your cash flow.  It’s your future.  Call or email, and we can help.

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Baseball and Financial Independence

How you borrow money will dictate your ability to retire how and when you want. Use this baseball analogy to learn the path to financial independence.

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Understanding the 3 sided balance sheet

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Are You Saving Enough?


I’m getting a little worried, I’ll be honest.  The housing and stock markets have been on fire for many years now, and of course will need to correct eventually.  They always do.  And the best thing I’ve found to protect ourselves and our families is having money in the bank.  The more the better! 

Unfortunately, reports just came out stating that, as a country, we are saving the least amount of our income since 2005!  So how much are YOU saving consistently each month?  From my experience, the “consistently” part of that question is what throws off many answers from my own clients.   

Are you satisfied with how much you are saving?  Historically, many of us here in the U.S. have been horrible savers.  Financial experts have long told us that we should be saving 10% to 20% of our personal income to achieve our long-term financial goals.  Yet, I rarely see reports that show us as a nation saving more than 5%.  And now, we are hovering back down close to 2% – the lowest since 2005.   

Why is this?  Typically this drop in personal savings happens when we “FEEL” wealthy.  First, there’s housing.  House prices have been rising quickly and steadily for all of us homeowners since the Great Recession.  It’s easy to understand.  The past few years, I would help a client buy a $400,000 house, and a year later the market says it’s worth $440,000…and you feel like you just made an extra $40,000 that year.  So why not go buy some stuff, right?!  I get it. 

Add to housing the insane rise in the stock market!  The DOW raced 25% higher in 2017 alone.  The S&P 500 index grew 19%.  Theoretically, if I have a $100,000 invested in the S&P 500 index at the start of the year, I just “made” another $19,000!  Here’s an article on this if you want to read further: 

And there’s one more thing adding to my growing concern – the increase in personal spending looks like it’s outpacing the growth in personal incomes.  What does this mean?  More people are spending at a faster pace than they are earning!  And that’s not a sustainable formula. 

Even though much of this article sounds pessimistic, I’m naturally a very optimistic guy.  But I think we all learned a great deal from the Great Recession.  And for me, I define financial safety as having lots of money in savings.  This will get me through the tough times when they do come.   

What should you do?  Of course, save as much as you can each month.  Secondly, take advantage of our complimentary Mortgage and Money Review.  This is a simple 15-minute phone review where we look at your current mortgage, any consumer debts you haveand your savings goals.  Let’s figure out if there are some ways we can free up extra cash flow to boost your savings!  Just email my team at with “Review Request” in the subject line.   

PS – if you want to read up more on what spurred this blog, here’s a good article: 

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The #3 Mistake Home Buyers Make

If you missed the #1 and #2 mistake home buyers keep making, catch up here: The #1 Mistake and The #2 Mistake.

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The #2 Mistake Home Buyers Make

If you missed the #1 mistake home buyers keep making, catch up here: The #1 Mistake

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Top 10 Lessons I Learned in December 2017


This is it!  I made it the entire year capturing the most important lessons I’ve learned each and every month and then narrowed them down to my top 10 to share with YOU!  Now the question is, will I be able to narrow down ALL of my 2017 lessons learned into my top 10 of the YEAR?  That will be tough, but I’m looking forward to reviewing all 120 lessons from 2017.

For now, here is my top 10 for December.  You’ll find a theme around goal setting and happiness, since that’s what December is typically about for me as I look ahead to the New Year.  I hope one or more these lessons can help you in some way move forward, either professionally or personally in 2018.  That’s why I share them.

  1. Pain + Reflection = Progress (Ray Dalio)
  1. Knowledge is only potential power.
  1. We tend to be the product of the thinking around us.  And far too much of this thinking is little!
  1. Once you truly believe you can do something, the “how-to-do-it” begins to materialize.  But first you must believe.  If you don’t, your mind will continue to find “reasons” to support this negative belief.
  1. Pursuing happiness actually pushes it away!  Happiness is actually the by-product of focusing and acknowledging your growth and progress.
  1. Lack of clarity leads to inaction.  Simply ask, “What’s the very next, most obvious step or action I want to take?”
  1. “The things that matter the most should never be at the mercy of things that matter the least.” (Jonathan Goethe)
  1. You can’t want something more for someone than they want for themselves.
  1. People love water; they hate waterboarding.  Meaning, don’t pile on too much too quickly.
  1. Failure:  Waiting for the difference-maker and not realizing it’s YOU!

Thank you for reading and following!  Keep learning.  Keep growing.  It is what we are designed to do as humans.  And PLEASE SHARE this with others to give value and help THEM grow.  Make 2018 amazing!

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