MADELEINE BRAND, host:
Over the last few weeks we've gotten many e-mails from listeners asking advice about their finances. So who better to answer them than our own personal finance contributor Michelle Singletary? Hi, Michelle.
MICHELLE SINGLETARY: Hi.
BRAND: Well, let's start with Donna from New York. She writes: I'm a college student. I don't have any debt yet and all my books are paid for. I have a small amount of money - very small - and I want to invest it. I want to see it grow. For personal reasons, I cannot open a high-yield account at the moment. So I wanted to know if you knew any other way in which I could invest this money.
SINGLETARY: First of all, I love that she's not in debt. You know that.
(Soundbite of laughter)
SINGLETARY: I think it's a great thing. But I think the best investment this student could do is to create a safety net for herself. I know she wants this money to grow, but I bet she doesn't have any money saved up for that rainy day. And we all know it's going to rain. So that one or two hundred dollars, I would recommend that she put it in a simple savings account. It doesn't even have to be an online account if she's got some issues with trying to open that up, because people need to remember an investment means that you're putting your money at risk.
And when you're a student like this - and that's such a small amount of money -you never know when you're going to need that for the books for the next semester. So I would tell her just to keep that and build up at least three months of the expenses that she needs, even as a student.
BRAND: So Michele, you're saying that she should have three months of living expenses before she even thinks about investing?
SINGLETARY: Absolutely. Now, listen, if she already has that saved up or she's got a cushion that she's comfortable with, I would suggest, because it's such a low dollar amount, that she go to sharebuilder.com. It's a Web site that allows people to invest small amounts of money by buying partial shares of stock. It's a great place to get started if you're an investor.
BRAND: Okay. Well, here's another one from Juan. I have a brother living in Chicago. He's lost his job, going through a tough financial time, and I'm worried that he's running up a large credit card debt. He's too proud to talk to me about this subject, so I'd like to have him see a third party for some advice. Where should he go for this third party advice?
SINGLETARY: You know, I love it when I hear family members - you know, they recognize a problem and they don't just sit back and they're trying to be pro-active. So he should be congratulated for doing that.
I would recommend that this brother go to debtadvice.org. That's debtadvice.org. This is a database for the Consumer Credit Counseling Service, often known as CCCS. All that person needs to do is type in their brother's zip code. They'll come up with an agency in their Chicago area. And in their case, it's the CCCS of Greater Chicago, and they can call them first and say, listen, my brother's in some trouble or maybe heading for trouble, what should I do, what should I talk to them about, and can they call you? And then sort of do some preliminary work and then give the number to the brother, say, you know, I'm a little concerned. You don't have to tell me all the details, but why don't you call this number? I think these people can help you create a budget and help you so that you don't amass a lot of debt while you're unemployed.
BRAND: Thank you, Michelle.
SINGLETARY: You're welcome.
BRAND: That's Michelle Singletary. She's our regular expert on personal finance. She writes the nationally syndicated column, The Color of Money. And if you have questions for Michelle, go to our Web site, npr.org. Click on the Contact Us link - it's at the top of every page - and be sure to put Michelle in the subject line.
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