Since the onset of this recession, many American families have had to make tough decisions regarding the use of savings/emergency funds that they haven’t wanted to make. Here we examine 5 different ways to help keep your savings safe, and earning you interest, despite a troubling economic environment.
Budgeting is one of the easiest and cheapest ways to save some extra money and make sure you’re not going overboard with your spending. Keep a written record of everything you spend money on over the course of a couple weeks or a month, and evaluate what you can or can’t do without, or do with less of. You would be surprised by how much you could save by minimizing unnecessary spending on certain items. This can free up some much needed cash and keep you away from dipping into your savings in the process.
– Open a Separate High Yield Savings Account
If living by the old adage, “out of sight, out of mind,” works well for you, then putting your savings into a separate high yield savings account, outside of the financial institution that you use for your checking, may be a great option for you. By putting your money elsewhere, each time you go to check up on your checking account balance online or by whatever means you use you won’t be tempted by seeing the balance of your savings account as well. In addition, by doing some research on other existing account options, you could potentially find a better APY and earn greater savings also.
– Look into a Certificate of Deposit (CD)
A CD is another great option when it comes to removing temptation. The difference between a CD and a regular savings account in this regard though, is that with a CD you commit to a pre-determined length of time wherein you agree not to touch your funds. During this time, the money you place in the CD is invested in safe options and ensured by the FDIC, with a usually fixed interest rate attached as well. This interest rate is usually higher than most standard savings account because of the slightly greater risk taken.
– Open a Free Checking Account
If you haven’t already got one, there’s no reason you shouldn’t switch to a free checking account. These days, there are so many great free checking account options that to pay for one is pretty senseless. By researching various free checking accounts you can ensure finding one that will work best for your financial needs, and save more money in the process, with the added potential of making some money through various incentive offerings by some institutions.
– Keep your Eyes on the Prize
Although it’s often easier said than done, simply keeping in mind what you’re saving for can be a great tool to ensure smart financial choices. The next time you think about taking money out of your savings, think about what that may mean for the future of your children or the various goals you have set forth for you and your spouse. Chances are you’ve worked hard to get those savings where they are today, and using them instead of figuring out better ways to spend or make your checking account and current income work better for you, can be a big blow to incur further down the road.
Stretching our money is something most of us would like to be able to do on a daily basis. Although the unfortunate reality of unexpected costs in life often makes this a difficult achievement, there are some concrete ways to work toward greater financial freedom and continued savings. Hopefully these five ideas and concepts will help you achieve these goals, and get you on the path to beneficial spending and smart financial choices in the future