Getting the Most from Your Savings Accounts
Building up a savings account is not as rewarding as it used to be. Interest rates on savings accounts are at all-time lows, which means that you will receive fairly minimal amounts of interest from cash held in most savings accounts, often the interest that you earn is less than the inflation rate. Given the low yields on these savings accounts, many people are wondering how to earn as much as possible from their savings. You have several different available options to maximize the benefits from these accounts.
Take Stock of Your Savings Accounts
Begin by taking stock of any existing savings accounts that you have opened. First, consider how you use the savings account. Determine the typical balance that you maintain in this account, how frequently you withdraw from and deposit to it and the length of time for which you are likely to leave the funds in the savings account. In addition, consider any bonus or extra features that are offered by your savings account. For example, consider the existing interest rate paid on the savings account, the ATM network with which it is associated (if any), any fees charged on its transactions and the ease of use of the bank’s website and online financial management tools.
After you have taken stock of the main features of your current savings account or accounts, you should also compile a list of the major needs you have for this type of account. Once you have created this list as well as an analysis of the positives and negatives of your existing savings account, you can consider any other available savings account options from competing financial institutions to see if any of them would meet your overall needs better.
Shopping for a New Savings Account
When shopping around for a new savings account, consider any special offers or incentives offered by the new bank for switching banks. Depending on the size of the savings account that you would be transferring, you may be able to secure a hefty financial bonus for switching savings accounts. Be sure to read the fine print to ensure that you fully understand any balance requirements or regulations regarding how long you must maintain this new account to avoid having to repay this incentive.
If you have already signed up for a new savings account or are happy with your current savings account, there are a number of ways to maximize the benefits of maintaining this type of account. Consider setting up automatic transfers from your checking account to your savings account; this strategy can help you increase the amount that you save each month, and may help you qualify for additional financial bonuses from some banks. Consider talking to your banker about setting up your savings account as a sweep account that transfers balances out at the end of the day for higher interest rates, but is still FDIC protected. In addition, you can use your savings account as a means of tracking your expenses and revenue by downloading the information directly from the bank’s website, which can assist you in bookkeeping and budgeting needs — helping you better manage and therefore save your money.
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