Best Saving Account
Saturday, October 20th, 2012Trying to get in a more secure financial situation? Want to find the best saving account for you and what you want to accomplish? Well, look no further. In this article I will show you some helpful tips of what to look for and lookout for on your quest to financial independence.
For one thing, it is important to keep in mind that the best saving account can mean different things to different people. Someone who is just starting out with their first job and has really no assets to speak of will have different needs from someone who is older and needs to pay for a child’s college or their own retirement.
There are two different, and common, saving vehicles you can use. Each has it’s own pros and cons and only you can decide which one, or possibly a combination of the two, is best for you.
Let’s start with a certificate of deposit or CD, these tend to earn higher interest rates than other forms of savings accounts. But, you guessed it, there is a catch.
The amount of interest you will earn with a cd will depend on several factors besides just which bank you choose. Things like the length of the term and the amount of the deposit are two of the biggest factors in how high of an interest rate you will receive.
To really get the best rate possible you will need to make a large deposit, something in the neighborhood of $10,000 and you will likely need to go for a longer term.
For anyone who has that kind of money to invest and who is investing for the long term, say a college eduction for their kids or retirement for themselves, this can be a viable option.
But many of us aren’t at that point. So, if that describes you, you may want to either invest in a shorter term cd or possibly even just a passbook savings account with your bank.
This can be a better option if you aren’t saving for some long term goal, but rather are just trying to put some money away for a rainy day.
This type of account will allow you the most liquidity but usually the least in the way of earnings. You just have to weigh all the pros and cons and factor that into your needs and time frame.
Many banks will also limit the amount of times you can draw money out of your savings account in a given month. While you can usually get at it as often as you want, you will usually have to pay a fee if you access it more often than allowed.
Of course, you can put money into your savings as often as you want to, you just are limited in how often you can take it out. Still, this may be a great way to start saving. Many of us will kind of “forget” about our money. That can make it easier for you to really get some money socked away.
I hope this information has helped. Now you have a better idea of what to look for in the best saving account.