savings account http://www.wisebread.com/taxonomy/term/114/all en-US Money a Mess? Try This Personal Finance Starter Kit http://www.wisebread.com/money-a-mess-try-this-personal-finance-starter-kit <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/money-a-mess-try-this-personal-finance-starter-kit" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/businessman_getting_ready_for_race_on_the_track.jpg" alt="Businessman getting ready for race on the track" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>I recently joined a meal delivery kit service, which has completely changed my cooking game. Every week, I receive a couple of boxes of pre-chopped and presorted fresh ingredients, along with a step-by-step recipe that helps me get a meal on the table in under 30 minutes. (See also: <a href="http://www.wisebread.com/are-meal-prep-subscription-boxes-worth-it?ref=seealso" target="_blank">Are Meal Prep Subscription Boxes Worth It?</a>)</p> <p>As I put together one of these meals last week, I started wondering why we haven't applied this concept to money yet. Where is the deliverable personal finance starter kit that will make handling your finances as easy as putting a quick and delicious meal on the table?</p> <p>Since we probably won't be seeing any &quot;Hello Cash&quot; or &quot;Green Apron&quot; boxes arriving in our homes anytime soon, I figured I could take matters into my own hands and create such a starter kit for adult-level finances. Here are the specific &quot;ingredients&quot; you need to go from broke to bank.</p> <h2>What you need: A checking account</h2> <p>Opening a checking account is the first step to conquering your adult-level finances. That's because having a bank hold onto your money is the safest and least expensive way for you to access and spend it. Putting your money in a checking account gives you several benefits:</p> <ul> <ul> <li> <p>Security and protection of your money: Up to $250,000 of your money is <a href="http://www.wisebread.com/what-you-need-to-know-about-the-fdic" target="_blank">FDIC insured</a> by banks and NCUA insured by federal credit unions, meaning you do not have to worry that your money will be wiped out if the banking institution fails. State-chartered credit unions are backed by private insurers. (See also: <a href="http://www.wisebread.com/heres-the-difference-between-a-federal-and-non-federal-credit-union?ref=seealso" target="_blank">Here's the Difference Between a Federal and Non-Federal Credit Union</a>)</p> </li> </ul> </ul> <ul> <li> <p>Free check cashing: Without a checking account, it is nearly impossible to cash a check without having to pay a fee, and those fees can take up to 3 percent of the value of the check. It's tough to get ahead financially if you have to pay to access your own money.</p> </li> </ul> <ul> <li> <p>Free bill pay: A checking account gives you access to paper checks and online bill pay. Without such an account, you will have to pay your bills with money orders, which also cost as much as $1 per money order. (See also: <a href="http://www.wisebread.com/5-reasons-paper-checks-are-still-relevant?ref=seealso" target="_blank">5 Reasons Paper Checks Are Still Relevant</a>)</p> </li> </ul> <ul> <li> <p>Access to a debit card: We live in a digital world, and it can be very difficult to handle your finances without a debit card or credit card. The majority of checking accounts these days come with a check card, which allows you to use your debit card like a credit card. (See also: <a href="http://www.wisebread.com/debit-or-credit-which-one-should-you-choose-at-the-checkout?ref=seealso" target="_blank">Debit or Credit? Which One Should You Choose at the Checkout?</a>)</p> </li> </ul> <p>To find the best checking account for you, consider your needs ― do you need an account with a low minimum balance, or do you plan to keep a high balance and want to earn some interest? Will an online bank cover all of your needs, or do you need a local branch? How often will you need to access the ATM? (See also: <a href="http://www.wisebread.com/8-ways-to-make-sure-you-never-pay-an-atm-fee?ref=seealso" target="_blank">8 Ways to Make Sure You Never Pay an ATM Fee</a>)</p> <p>Taking the time to find a checking account and bank that will fit your financial needs will help you keep more money where it belongs ― in your account and in your wallet.</p> <h2>What you need: A savings account</h2> <p>The next financial ingredient you need is a savings account. While the interest rates on savings accounts are still depressingly low, that does not change the fact that an FDIC or NCUA-insured savings account serves as the foundation for financial planning for the future. Here's why.</p> <ul> <li> <p>It makes it easier to <a href="http://www.wisebread.com/7-reasons-you-really-need-to-pay-yourself-first-seriously" target="_blank">pay yourself first</a>: It's very hard to save money without a place to put it that is separate from your checking account. Opening a savings account gives you a more difficult-to-access spot for your money to grow. (See also: <a href="http://www.wisebread.com/4-easy-to-fix-reasons-your-savings-account-isnt-growing?ref=seealso" target="_blank">4 Easy-to-Fix Reasons Your Savings Account Isn't Growing</a>)</p> </li> <li> <p>It can serve as your emergency fund: Financial hiccups, mistakes, and emergencies can hit anyone at any time. The difference between a financial emergency just being a nuisance and it becoming a catastrophe comes down to whether or not you have <a href="http://www.wisebread.com/a-step-by-step-guide-to-creating-your-emergency-fund" target="_blank">an emergency fund</a>. Without one, you will be left scrambling to find money. With one, your emergency fund can simply absorb the cost of the emergency without affecting your usual spending. (See also: <a href="http://www.wisebread.com/where-to-turn-for-help-when-you-dont-have-an-emergency-fund?ref=seealso" target="_blank">Where to Turn for Help When You Don't Have an Emergency Fund</a>)</p> </li> </ul> <p>While it may be easy to open a savings account with the same bank where you already have a checking account, you might want to consider an account at a different bank. This can help keep the money out of your reach if you're likely to spend it, and could possibly get you a better interest rate, especially if you're willing to put your savings into an online bank. (See also: <a href="http://www.wisebread.com/the-pros-and-cons-of-keeping-all-your-accounts-in-one-bank?ref=seealso" target="_blank">The Pros and Cons of Keeping All Your Accounts in One Bank</a>)</p> <p>Of course, opening a savings account is not enough. You need to actually use it regularly. The trick to getting the most out of your savings account is to set up regular, automatic transfers into it, so that your savings will grow without you having to think about it. (See also: <a href="http://www.wisebread.com/earn-more-interest-by-reducing-savings-friction?ref=seealso" target="_blank">Earn More Interest by Reducing Savings Friction</a>)</p> <h2>What you need: A simple budget</h2> <p>Once you have a checking account, a savings account, and automatic transfers into savings, then you are ready for the next ingredient: your budget.</p> <p>This is often the portion of financial adulting that makes the fainthearted run screaming into the distance. But budgeting is really about organizing your money so that you can spend it on the things that matter and scrimp on the things that don't.</p> <p>The basis of budgeting is keeping track of your income and expenses. There are several ways to do this without having to break out a spreadsheet. You can use sites like Mint.com to track your spending for you and declutter the financial information coming in to you so that it's easier to track. (See also: <a href="http://www.wisebread.com/build-your-first-budget-in-5-easy-steps?ref=seealso" target="_blank">Build Your First Budget in 5 Easy Steps</a>)</p> <p>When you have a decent idea of what you bring in and what you spend, then it's time to start managing your funds so that you spend less than you earn. How you manage your money is up to you, but the main idea is to save your splurges for the things you really value, and cut back your spending everywhere else. (See also: <a href="http://www.wisebread.com/how-to-manage-your-money-no-budgeting-required?ref=seealso" target="_blank">How to Manage Your Money &mdash; No Budgeting Required</a>)</p> <h2>What you need: A Roth IRA</h2> <p>Your financial life is really starting to look good at this point, so it's time to add the next ingredient: a Roth IRA. This tax-advantaged retirement account is a great way to save for your future.</p> <p>Roth IRAs are funded with post-tax dollars, which means you will not get a tax break when you make a contribution ― but any investment gains can be withdrawn tax-free anytime after age 59&frac12;. Since it's very likely that you'll be in a higher tax bracket by then, this makes the Roth IRA a great deal for newly-minted financial adults. You may contribute up to $5,500 per year to your Roth IRA, and there is no age limit on contributions since you will never be forced to take minimum required distributions on this account, unlike traditional IRAs and 401(k)s. (See also: <a href="http://www.wisebread.com/which-retirement-account-is-right-for-you?ref=seealso" target="_blank">Which Retirement Account Is Right for You?</a>)</p> <p>In addition, you can access up to $10,000 of your earnings penalty-free from your Roth IRA to put toward buying your first home. You may also access your principal at any time without having to pay a penalty, which is not possible with traditional IRAs and 401(k)s.</p> <p>That being said, if you do have access to a 401(k) retirement savings account at work and there is an employer match for your contributions, you will want to make sure you contribute up to the full employer match before funding your Roth IRA. The employer match is free money, after all. (See also: <a href="http://www.wisebread.com/7-retirement-planning-steps-late-starters-must-make?ref=seealso" target="_blank">7 Retirement Planning Steps Late Starters Must Make</a>)</p> <p>The best way to make sure you max out your Roth IRA contributions is to make them completely automated, just like your savings.</p> <h2>The optional garnish: A rewards credit card</h2> <p>At this point, your adult-level finances should be working well and taking good care of you. The next level of financial expertise is to start using your regular spending to help you achieve more of your financial goals. You can do this with a <a href="http://www.wisebread.com/best-rewards-credit-cards-for-newbies" target="_blank">rewards credit card</a> that rewards you for your regular spending. With savvy use of such cards, you can earn anything from <a href="http://www.wisebread.com/5-steps-to-picking-the-best-airline-credit-card-for-the-most-rewards-value" target="_blank">flights</a> to <a href="http://www.wisebread.com/the-best-credit-cards-for-hotel-deals-and-rewards" target="_blank">hotel stays</a> to plain old <a href="http://www.wisebread.com/5-best-cash-back-credit-cards" target="_blank">cash back</a>.</p> <p>But, there is a reason why this is an optional garnish, rather than one of the main ingredients of financial adulthood. Banks and credit card companies don't offer rewards cards to be nice to their customers ― credit card rewards can make even the most frugal financial grown-up forget their budget limitations. If you are able to pay off your credit card in full each month and just reap the free rewards, then a rewards credit card can be a delicious topper to your financial adulthood. (See also: <a href="http://www.wisebread.com/how-to-escape-reward-card-spending-traps?ref=seealso" target="_blank">How to Escape Reward Card Spending Traps</a>)</p> <p>If, on the other hand, you know that you will struggle to pay off your balance every month, then feel free to enjoy your financial adulthood sans rewards credit card. It's not a necessary part of your financial starter kit ― it just makes for a nice addition. (See also: <a href="http://www.wisebread.com/6-smart-reasons-to-pay-your-credit-card-bill-before-its-due?ref=seealso" target="_blank">6 Smart Reasons to Pay Your Credit Card Bill Before It's Due</a>)</p> <h2>Whipping up a financial adulthood</h2> <p>While it would be convenient if you could order a financial adulthood starter kit to show up at your doorstep, it's actually pretty simple to put together one of your own. Just know the basic ingredients you need, find the ones that work best for you, be consistent ― and, voilà! You'll go from broke to bank before you know it.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fmoney-a-mess-try-this-personal-finance-starter-kit&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FMoney%2520a%2520Mess-%2520Try%2520This%2520Personal%2520Finance%2520Starter%2520Kit.jpg&amp;description=Money%20a%20Mess%3F%20Try%20This%20Personal%20Finance%20Starter%20Kit"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Money%20a%20Mess-%20Try%20This%20Personal%20Finance%20Starter%20Kit.jpg" alt="Money a Mess? Try This Personal Finance Starter Kit" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/money-a-mess-try-this-personal-finance-starter-kit">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-ways-to-prepare-for-your-best-black-friday">11 Ways to Prepare for Your Best Black Friday</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-start-a-family-before-reaching-these-5-money-goals">Don&#039;t Start a Family Before Reaching These 5 Money Goals</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-financial-resolutions-you-can-conquer-before-new-years">10 Financial Resolutions You Can Conquer Before New Year&#039;s</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/are-you-putting-off-these-9-adult-money-moves">Are You Putting Off These 9 Adult Money Moves?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-financial-decisions-youll-never-regret">8 Financial Decisions You&#039;ll Never Regret</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance banking budgeting cash back checking account emergency funds money moves retirement rewards Roth IRA saving money savings account starter kit Tue, 22 Aug 2017 09:00:05 +0000 Emily Guy Birken 2006372 at http://www.wisebread.com 4 Easy-to-Fix Reasons Your Savings Account Isn't Growing http://www.wisebread.com/4-easy-to-fix-reasons-your-savings-account-isnt-growing <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/4-easy-to-fix-reasons-your-savings-account-isnt-growing" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_piggy_bank_100350013.jpg" alt="Woman learning reasons your savings account isn&#039;t growing" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Your savings account seems to be broken.</p> <p>You set it up some time ago, full of hope and high expectations, and you have been moving money into it whenever you can &mdash; but it just isn't growing the way you would expect.</p> <p>The lack of growth in your savings account may be disheartening, but it's probably due to a problem that you can fix easily. Here are the top four reasons your money doesn't grow in a savings account, and what you can do to start seeing higher balances:</p> <h2>1. The Problem: You Make Regular Withdrawals From Your Savings Account</h2> <p>The quickest way to undo all your savings work is to raid the account. Whether that happens because you are regularly transferring funds from savings to checking, or because you're withdrawing cash from your savings account at the ATM, or because you let your savings account act as your overdraft protection, the result is always the same &mdash; your savings account balance stays low.</p> <h3>The Easy Fix: Reduce Access to Your Account</h3> <p>The fix for this problem is to reduce your access to your savings account. Having too-easy access to savings accounts can kill your ability to effectively save money. Instead, consider moving your savings account to a different bank than your checking, and establish a link between the two. With your savings account out of sight, the money will be out of mind. And that's the best way to let it grow without your interference.</p> <h2>2. The Problem: Transfers to Your Savings Account Are Infrequent and Small</h2> <p>You transfer money to your account when you can, but that tends to only happen every couple of months when you finally get ahead of your bills. And even when you are able to make deposits in your savings account, the amounts are never very high. It almost feels like it's not worth transferring the money.</p> <h3>The Easy Fix: Automate Your Savings</h3> <p>Regular Wise Bread readers are well aware of the importance of automating your savings. Doing so allows you to pay yourself first and take away the temptation of extra dollars in your checking account. Set an automatic transfer up once, and you will reap the benefits of savings account growth for good. Remember that there are a couple of ways to make sure your automation helps you build your savings as much as possible:</p> <ul> <li>Automatically transfer a set amount to savings on your payday. If you don't see it in your checking account, you won't spend it.</li> </ul> <ul> <li>Have your paycheck deposited directly into your savings account, and transfer the amount you need for your monthly budget into checking. While this gives you less of a buffer in your checking account, it offers the psychological boost of seeing the numbers in your savings account go up quickly, which can help curb mindless and impulse spending.</li> </ul> <h2>3. The Problem: You Are Saving Money, But Not for Anything in Particular</h2> <p>Without a specific goal in mind, it can be difficult to get psyched about the money in your savings account. Yes, it's great that you have several hundred (or several thousand) dollars sitting in a savings account, but it can feel like having an auxiliary checking account if you don't have a specific purpose in mind for the money. And not having a goal for you money makes it much easier to raid the account if you find yourself lusting after Coachella tickets.</p> <h3>The Easy Fix: Create Targeted Savings Accounts</h3> <p>We are much more likely to feel excited about saving money if we have a specific goal in mind. This is partially due to something known as <a href="http://www.wisebread.com/mental-accounting-why-you-blow-your-tax-refund-but-not-your-raise">mental accounting</a>, which is our tendency to value money differently depending on how it is physically and mentally labeled. You might feel no compunction about &quot;borrowing&quot; $400 from your general savings account for a Coachella ticket, but taking that money from your new car fund would hurt.</p> <p>Many online and traditional banks will allow you to create several targeted accounts, each with its own nickname. Taking the time to put a name to each one of your savings goals can help you save more and spend less.</p> <h2>4. The Problem: Your Interest Rate Is Too Low</h2> <p>Maybe you are doing everything right with your savings account. You have regular, automatic deposits, and you keep your hands off the account. But it's still not growing &mdash; because the interest rate is at rock bottom. According to Bankrate, the average APY for savings accounts is a measly 0.08%, which means inflation is eating into your money if you leave it in your savings account for any amount of time.</p> <h3>The Easy Fix: Transfer Your Money Into a Money Market Account</h3> <p>If you are just getting started with savings, it's probably a good idea to continue to set money aside into your savings account. But if you've grown your savings account over time and get sick of seeing teeny tiny interest payments, then you might want to consider transferring your savings into a money market account.</p> <p>These accounts are a type of savings product that double as a checking account, with an interest rate that is much more generous compared to that of traditional savings accounts. For instance, according to Bankrate, the best money market accounts offer APY rates of up to 1.11%.</p> <p>Money market accounts generally require a larger minimum deposit &mdash; you can expect to need at least $1,000 to open your account. In addition, you may face fees on your money market account if you allow your balance to dip below a certain level. For most money market accounts, you may write checks on the account, although you are generally limited to no more than six checks (or other withdrawals) per month.</p> <p>For savers who have been diligently putting money aside into a traditional savings account, rolling that money into a money market account can be a great way to put your savings to work for you by increasing your interest.</p> <h2>The Bottom Line</h2> <p>Your savings account deserves to grow and flourish. Most of the problems keeping your balance down are well within your control, as long as you take the time to address them. Don't let an easy-to-fix problem keep you from meeting your savings goals.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/4-easy-to-fix-reasons-your-savings-account-isnt-growing">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/money-a-mess-try-this-personal-finance-starter-kit">Money a Mess? Try This Personal Finance Starter Kit</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-new-reasons-you-need-an-emergency-fund">4 New Reasons You Need an Emergency Fund</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-easy-ways-to-improve-your-credit-score-during-the-holidays">3 Easy Ways to Improve Your Credit Score During the Holidays</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-secret-to-better-money-management-may-be-in-your-past">The Secret to Better Money Management May Be in Your Past</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-a-surprise-credit-limit-increase-can-harm-you">How a Surprise Credit Limit Increase Can Harm You</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance automatic transfers checking account growing interest rates money market accounts saving money savings account Wed, 16 Nov 2016 10:00:09 +0000 Emily Guy Birken 1833768 at http://www.wisebread.com 5 Ways to Grow Your Savings Without a Steady Paycheck http://www.wisebread.com/5-ways-to-grow-your-savings-without-a-steady-paycheck <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-ways-to-grow-your-savings-without-a-steady-paycheck" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/happy_woman_piggy_bank_000031080258.jpg" alt="Woman learning ways to grow her savings without a steady paycheck" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Whether you're a freelancer or part-time employee, not having a regular salary can disrupt your progress toward big financial goals. Money fluctuations can mean you either have to stop the savings transfers, or withdraw money out of the account to cover bills.</p> <p>But saving money without a regular paycheck isn't impossible, and with these tips you can learn to create a savings habit that sticks!</p> <h2>1. Separate All Your Savings Goals</h2> <p>Even if you have a separate savings account, it's too tempting to have all the money in one account while simply allocating the funds to different savings goals. For this reason I recommend <a href="http://www.wisebread.com/4-things-to-consider-before-you-open-an-online-savings-account">opening a new savings account</a> for each individual goal.</p> <p>My husband and I recently did this as an experiment, and for two months in a row we've had a surplus of money in our bank accounts, and have been able to save money toward all of our goals. And we're both self-employed so you know how difficult this can be!</p> <p>While it is possible to have too many accounts, this strategy works for us, and has allowed us to pay all of our bills, self-employment taxes, and save extra money toward various specific goals.</p> <h2>2. Pay Yourself a Regular Salary</h2> <p>As a freelancer, temp, or someone who works on commissions, it's still important to pay yourself a &quot;salary&quot; on a regular basis. I deposit a regular salary from my business account to the household account every Monday &mdash; no matter how little or how much my freelance business brings in.</p> <p>Giving yourself a regular &quot;paycheck&quot; will help combat the inconsistent income that comes with being self-employed. It may take a few months for your budget to adjust to the changes, but it can drastically <a href="http://www.wisebread.com/best-money-tips-improve-your-finances-in-5-minutes">improve your finances</a> and allow you to finally get into the habit of saving money.</p> <h2>3. Try a Microsaving Tool</h2> <p>Microsaving is when you save extremely small amounts of money &mdash; like $2 or $5 a week. As your budget adjusts to the savings, and you begin to see your small balance grow, you can increase the savings amounts. Next thing you know, you've saved a couple hundred dollars that can be used towards anything you want.</p> <p>To make it even easier to save money without thinking, there are several different <a href="http://www.wisebread.com/5-microsaving-tools-to-help-you-start-saving-now">microsaving apps</a> available that will put saving money into automatic mode.</p> <ul> <li><a href="https://digit.co/">Digit</a> is a popular tool that allows you to start saving money via text message. Once you link your account, Digit will start withdrawing a few dollars every week and deposit into your new Digit account, based on your bank balance and only if you can afford it.<br /> &nbsp;</li> <li><a href="https://www.acorns.com/">Acorns</a> is a microsaving investment tool that helps beginner investors or students get their feet wet in the market. Everyone has to start somewhere and Acorn's round-up payment withdrawals makes saving money very easy.<br /> &nbsp;</li> <li><a href="https://www.smartypig.com/">SmartyPig</a> allows you to create individual accounts for each savings goal and keeps you updated on the progress. You can also earn rewards, cash back, and gift cards as incentives to save money.</li> </ul> <h2>4. Find What Motivates You to Save</h2> <p>What motivates you to save money? Are you a competitive person who likes to turn saving money into a challenge? Find a few friends who will commit to a savings competition with you. Whoever reaches the goal first gets a free dinner, night out, or other incentive (paid for by the losers, of course!).</p> <p>Are you an artist or visual person? Try mapping your progress by coloring in circles for each $50 or $100 you save. Whether it's goal tracking, paying off debt, or saving for a particular event, try coloring your way to reaching your goal. And when you've reached your goal you can hang the artwork in your home as a motivational reminder.</p> <h2>5. Join a Savings Challenge</h2> <p>Much like a diet helps you jumpstart your weight loss plan or workout regimen, a savings challenge can help you get your spending under control, and create a regular savings habit.</p> <p>There are lots of different challenges available. You can go on a 14-day spending diet, a 60-day&nbsp;<a href="http://www.carefulcents.com/cash-budget-challenge/">cash budget challenge</a>, a year-long shopping ban. Last year I participated in a 12-month money challenge from inspiration I found on Pinterest. But the options are basically limitless, so start out small and then increase the challenge as you become more comfortable with it.</p> <p>Experiment with different methods and test out strategies based on your money personality and saving style. Don't be afraid to try out new ideas to see how they work for you.</p> <p><em>How do you save money without a regular paycheck? Share your best tips!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/carrie-smith">Carrie Smith</a> of <a href="http://www.wisebread.com/5-ways-to-grow-your-savings-without-a-steady-paycheck">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-to-build-business-credit-when-youre-self-employed">5 Ways to Build Business Credit When You&#039;re Self-Employed</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-step-by-step-guide-to-creating-your-emergency-fund">A Step-by-Step Guide to Creating Your Emergency Fund</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/meet-meg-favreau-our-senior-editor">Meet Meg Favreau, Our Senior Editor</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-easy-to-fix-reasons-your-savings-account-isnt-growing">4 Easy-to-Fix Reasons Your Savings Account Isn&#039;t Growing</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/you-got-a-raise-now-what">You Got a Raise! Now What?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance freelancing paychecks savings account savings plan self-employment Thu, 10 Sep 2015 15:00:27 +0000 Carrie Smith 1553947 at http://www.wisebread.com Chase Total Checking and Savings: Easy Everyday Banking http://www.wisebread.com/chase-total-checking-and-savings-easy-everyday-banking <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/chase-total-checking-and-savings-easy-everyday-banking" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock_000037506278_XXXLarge.jpg" alt="man using smartphone" title="man using smartphone" class="imagecache imagecache-250w" width="250" height="166" /></a> </div> </div> </div> <p>Years ago, when you wanted to open a checking or savings account at a bank, you'd head over to a bank in your neighborhood. These days, setting up a new account no longer requires a live person to walk you through it. There are <a href="http://www.wisebread.com/5-best-online-checking-accounts?ref=internal">banks exclusively online</a> to prove it. (See also: <a href="http://www.wisebread.com/banks-still-offering-free-checking-and-great-interest-rates?ref=seealso">Banks Still Offering Free Checking and Great Interest Rates</a>)</p> <p>If you're shopping for a bank to open a checking or savings account at, you're probably wondering which bank is best: local credit union, exclusive online bank, or one that provides both online and brick and mortar services. While online exclusive banks may offer slightly lower fees or higher APYs, a large, traditional bank can provide valuable resources and services along with integrated online and mobile options that make banking a breeze.</p> <p>Take, for example, Chase Total Checking&reg;. Their motto is &ldquo;Simple and Accessible&rdquo; &mdash; and with 15,500 Chase ATMs and 5,400 branches across the nation, it won&rsquo;t be too difficult to find a location to get cash or deposit checks in person. And you can get even more out of your banking if you open a Chase Savings<sup>SM</sup> account too. And they're offering new customers up to a $250 bonus! See details below.</p> <h2>How to Open an Account</h2> <p>To open a Chase Total Checking&reg; account, you need to deposit a minimum of $25. There is a $12 monthly service fee, which you can get around by doing one of the following:</p> <ul> <li>Make direct deposits to your account totaling $500 or more.</li> <li>Maintain a $1,500 minimum daily balance.</li> <li>Maintain an average daily balance of $5,000 or more in qualifying linked deposits or investments.</li> </ul> <p>The minimum deposit for a savings account is also $25. The monthly fee is $5, which is waived if you do one of the following:</p> <ul> <li>Maintain a $300 minimum daily balance.</li> <li>Have at least one repeating automatic transfer of at least $25 from your personal Chase checking account.</li> <li>Link your savings account to a Chase Premier Plus Checking, Chase Premier Platinum Checking, or Chase Private Client Checking account.</li> <li>Be younger than 18 years old.</li> </ul> <h2>Sign-up Offers</h2> <p>Chase is offering $150 for their new customers who open a Chase Total Checking&reg; account and set up direct deposit. If you open a new Chase Savings<sup>SM</sup> account (even if you already do some of your banking with Chase), you can get $100 by depositing $10,000 in new money within 10 business days and keeping a $10,000 balance for 90 days. This means that you can receive $250 if you qualify for both offers! But be sure to jump on them soon &mdash; these offers expire October 14, 2015.<a target="_blank" href="http://track.linkoffers.net/a.aspx?foid=26126800&amp;fot=1253&amp;foc=1" rel="nofollow"><strong><br /> </strong></a></p> <h2>Online and Mobile Banking</h2> <p>If you prefer to do your banking from the comfort of your living room &mdash; or really, anywhere with Internet connection &mdash; Chase offers online and mobile banking. Some of their services include:</p> <ul> <li><strong>Chase QuickDeposit:</strong> Take a picture of your check and deposit it with the Chase Mobile App. Easy!<br /> &nbsp;</li> <li><strong>Chase QuickPay:</strong> Send money to another person, no cash or checks necessary. Just enter the recipient&rsquo;s email address or mobile number and Chase will send them an email with instructions on how to accept the payment. They don't have to be a Chase customer, but they do have to create a Chase user account.<br /> &nbsp;</li> <li><strong>Online Bill Pay:</strong>&nbsp;Your bill payments will be sent on the date you specify. If your payment is ever delayed, Chase will refund 100% of any late fees (provided they got the payment request before the cutoff time and the payee information was correct).</li> </ul> <h2>Automatic Savings</h2> <p>You can set up a repeating automatic transfer from your Chase checking to your savings account...and forget about it! Actually, don't, because it's important to monitor your money. But there's no denying that Chase's Automatic Transfer Program takes most of the effort out of saving, and it's an easy way to get the monthly fee on your savings account waived &mdash; just set the transfer amount to at least $25 a month.</p> <h2>Account Alerts</h2> <p>Need to keep a close eye on your account? (I mean, who doesn&rsquo;t?) Chase will text or email you if your account is low on funds, there is a large transaction, or other account activity. It&rsquo;s easy to personalize what account alerts you receive and how you receive them.</p> <h2>Pros</h2> <p>$250 is an attractive sign-up offer! Plus, between the online/mobile banking offerings and account alerts, it&rsquo;s easy to stay on top of your finances wherever you are. And you'll likely never worry about having to hunt down a Chase ATM or branch, if you need to access your money quickly or get a banker's help.</p> <h2>Cons</h2> <p>You might forget about the minimum balance or requirements for waiving the monthly fee and get hit with it. That's one of the disadvantages of having an account that &quot;waives&quot; your fee rather than provides it for free. <a href="http://www.anrdoezrs.net/click-2822544-10124087-1437509025000?sid=review-chase_total">Capital One 360</a> offers a free interest bearing checking account, and <a target="_blank" href="http://www.dpbolvw.net/click-2822544-11035571-1443704483000?sid=review-chase_total">Discover offers a savings account</a> with a whopping 1.20% APY for all balances.&nbsp;</p> <h2>Are Chase Total Checking&reg; and Savings<sup>SM</sup> Right for You?</h2> <p>If you're looking for a solid bank with both a physical presense as well as plenty of online and mobile conveniences, Chase is a great option. Along with their basic banking offerings, Chase has a good reputation for their other consumer products like credit cards. Having a lot of your financial accounts under one company can be incredibly convenient.</p> <p>&nbsp;</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/amy-lu">Amy Lu</a> of <a href="http://www.wisebread.com/chase-total-checking-and-savings-easy-everyday-banking">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-9"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-best-online-savings-accounts">5 Best Online Savings Accounts</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/banks-still-offering-free-checking-and-great-interest-rates">Banks Still Offering Free Checking and Savings with Great Interest Rates</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/capital-one-360-review">Capital One 360: A Competitive Banking Option</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-best-online-checking-accounts">5 Best Online Checking Accounts</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-steps-to-finding-your-mortgage-lender">4 Steps to Finding Your Mortgage Lender</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking bank reviews chase checking account credit cards savings account Tue, 28 Jul 2015 23:01:36 +0000 Amy Lu 1500568 at http://www.wisebread.com Why Savings Account Interest Rates Are So Low http://www.wisebread.com/why-savings-account-interest-rates-are-so-low <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/why-savings-account-interest-rates-are-so-low" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/piggy-bank-3636177-small.jpg" alt="piggy bank" title="piggy bank" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p>In 2006, I started writing about personal finance. One of the first topics I wrote about was the online high-yield savings account. (See also: <a href="http://www.wisebread.com/5-best-online-savings-accounts">The Best 5 Online Savings Accounts</a>)</p> <p>Back then, these accounts were all the rage. I opened an account offering 5% APY and wrote about how great online accounts were for emergency fund purposes. A deposit of $1,000 meant a little more than $4 in interest the first month.</p> <p>Now, you'd be hard-pressed to find a high-yield account offering much more than 1% APY, providing you with right around 83 cents in interest the first month. That's a <em>big</em> difference.</p> <p>But why are <a href="http://www.wisebread.com/how-to-earn-a-good-interest-rate-in-a-low-rate-environment">interest rates so low on savings accounts</a>? Shouldn't we want to encourage savers in our current economy?</p> <h2>Depositors vs. Borrowers</h2> <p>In reality, banks can pay whatever yield they want on a savings account. If a bank wanted to start paying 5%, it could. There's nothing stopping it, except the desire to turn a profit.</p> <p>Banks set yields on deposits based on the rate they can get for lending money. The difference between what a bank receives on mortgages and auto loans and other credit, and what the bank pays out in yields to depositors, represents one of the bank's revenue streams.</p> <p>In 2007, when I bought my home, the best interest rate available to me was 6.02%. By then, the yield on my savings account had dropped to 4%. Now, you can get a mortgage for right around 3.50%. As long as a bank is able to lend at a rate higher than what it pays to depositors, there's a better chance of profit.</p> <p>So why even pay depositors at all? The reason is that banks are required to keep <em>some</em> capital in their reserves. They are required to keep money in &mdash; for lack of a better word &mdash; the vault in order to lend. For the most part, credits and debits appear on paper and digitally. But those records have to show that the bank has money in reserve.</p> <p>Hence the need for depositors.</p> <p>Banks need to attract depositors to put money in the bank, so they have something to lend (or something to leverage). A bank pays a yield in order to encourage you to park your money in an account; the bank then lends the money at a higher rate than it pays you.</p> <h2>The Federal Reserve and Savings Account Rates</h2> <p>So why are mortgage (and other loan) rates so low? What sets <em>those</em> rates?</p> <p>The Federal Reserve plays a large role in determining what the rates look like. There are two main rates that come into play:</p> <ul> <li><strong>Federal Discount Rate</strong>: This is the rate at which the Federal Reserve lends money to the banks.</li> <li><strong>Federal Funds Rate</strong>: This is the rate we're all familiar with when the news talks about the Fed &quot;setting rates.&quot; This is the rate at which banks can lend money to each other.</li> </ul> <p>The Federal Reserve prefers banks to lend to each other, rather than borrow from the Fed, so the Federal Funds Rate is often a little lower than the Discount Rate.</p> <p>Since consumer spending drives about 70% of economic activity in our country, the ability of banks to lend to each other, and to consumers, to keep the money going 'round the economy is a big part of what the Federal Reserve does.</p> <p><strong>Lower Fed Rates Encourage Borrowing</strong></p> <p>In times of economic turmoil and difficulty, the Fed lowers the two rates in order to encourage borrowing. Right now, the Fed Discount Rate is at 0.75%, and the Fed Funds Rate is operating in a target range of between 0% and 0.25%.</p> <p>In a down economy, with so much of the activity dependent on consumer spending, the goal is to attract consumers to loans. These low Fed rates bring loan rates down. Since banks can borrow from the Fed, and from each other, at such low rates, it means they can lend to consumers at lower rates, encouraging them to borrow.</p> <p><strong>Fed Purchases of Treasuries Reduce Mortgage Rates</strong></p> <p>Another twist is the fact that the Federal Reserve is still buying long-term Treasury securities. The rates on long-term Treasury securities often influence mortgage rates. As long as the Fed maintains its monthly bond purchase program, long-term Treasury rates are expected to remain somewhat low, keeping mortgage rates down with them.</p> <p>Of course, once the banks are no longer enjoying higher rates of return on the money they lend, it means they no longer pay their depositors a truly high yield.</p> <h2>When Will Savings Account Rates Go Up?</h2> <p>Following the last policy meeting for the Federal Open Market Committee (FOMC), the body that sets interest rate policy, Federal Reserve Chair Ben Bernanke announced that interest rates will remain ultra-low until 2015. The bond purchases will continue for now, but they are likely to be reduced as a prelude to an interest rate hike from the Fed.</p> <p>No one knows for sure when the Fed will decide to hike rates. The FOMC makes its decisions based on how members feel the economy is faring. If the economy is heating up, the Fed raises interest rates in order to slow inflation and keep growth in check.</p> <p>As the economy improves, interest rates are more likely to rise. There isn't the need to encourage banks and consumers to borrow, so rates are allowed to rise. Once the interest rates on loans begin rising, the yields on savings accounts are likely to begin rising as well.</p> <p>Until then, consumers are stuck looking for yield in places other than savings accounts. Many are turning to the stock market, since all of these efforts at economic stimulus are aimed at helping businesses borrow at lower rates (and boost their profits). However, there are larger risks with stocks than with cash held in a bank <a href="http://www.wisebread.com/what-you-need-to-know-about-the-fdic">insured by the FDIC</a>.</p> <p>If you have debt, though, now is a good time to aggressively tackle it. With interest rates lower, more of your payment goes to principal. And paying off high-interest debt will offer you a better return on your money than watching it languish in a savings account.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/miranda-marquit">Miranda Marquit</a> of <a href="http://www.wisebread.com/why-savings-account-interest-rates-are-so-low">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-countries-where-banks-pay-crazy-interest-rates">10 Countries Where Banks Pay Crazy Interest Rates</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-things-you-need-to-know-before-taking-out-a-personal-loan">10 Things You Need to Know Before Taking Out a Personal Loan</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-best-online-savings-accounts">5 Best Online Savings Accounts</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-easy-to-fix-reasons-your-savings-account-isnt-growing">4 Easy-to-Fix Reasons Your Savings Account Isn&#039;t Growing</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-signs-its-time-to-find-a-new-savings-account">4 Signs It&#039;s Time to Find a New Savings Account</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking interest rates savings account Wed, 17 Apr 2013 10:24:31 +0000 Miranda Marquit 973515 at http://www.wisebread.com A Step-by-Step Guide to Creating Your Emergency Fund http://www.wisebread.com/a-step-by-step-guide-to-creating-your-emergency-fund <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/a-step-by-step-guide-to-creating-your-emergency-fund" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/2301500208_7136f3fa7d_z_0.jpg" alt="cat and coin jar" title="cat and coin jar" class="imagecache imagecache-250w" width="250" height="157" /></a> </div> </div> </div> <p>Ask any respected voice in the personal finance community what the number one thing you should do to get your finances in order is, and the chances are very high that they'll say you need to start by developing an emergency fund.</p> <p>For instance, Dave Ramsey, author of the &quot;<a href="http://www.amazon.com/gp/product/159555078X/ref=as_li_ss_tl?ie=UTF8&amp;tag=lx04-20&amp;linkCode=as2&amp;camp=1789&amp;creative=390957&amp;creativeASIN=159555078X">The Total Money Makeover</a>,&quot; has this as the very first step in his Seven Baby Steps.</p> <p>Why?</p> <p>Because if you ever lose your job or are otherwise unable to bring in an income, the emergency fund would be your go-to source until you get back on your feet.</p> <p>So how do&nbsp;you go about creating your emergency fund? Here's a step-by-step guide to help you. (See also:&nbsp;<a href="http://www.wisebread.com/emergency-plan-better-than-an-emergency-fund">Emergency&nbsp;Plan:&nbsp;Better Than an&nbsp;Emergency&nbsp;Fund</a>)</p> <h2>Figure Out How Much You Can Save</h2> <p>The first step to creating an emergency fund is to determine how much you can consistently save. Now, if you work a normal job, you probably get paid every two weeks on a Friday. Knowing this, with each pay period, you should be dividing your paycheck between four main categories: retirement savings, fixed costs, regular bills, and savings.</p> <p>Digging deeper, how much money should you send to each category?</p> <p>Let's start with your retirement. Most experts suggest saving 10% of your income. That leaves 90% available for your fixed costs, regular bills, and savings. Fixed costs usually include rent/mortgage payments, food, and transportation expenses. Regular bills include utility, phone, and internet bills.</p> <p>Now, we'll assume you need 85% of your income to pay for fixed costs and regular bills. That leaves 5% available for you to save for your emergency fund.</p> <p>Knowing these percentages, here's how your money should be divided. Suppose you make $2,000 every pay period. In that case, you'd put $200 towards your retirement, $1,700 for your fixed costs and regular bills, and $100 towards your emergency fund.</p> <p>Of course, if you look for ways to <a href="http://www.wisebread.com/10-monthly-bills-you-can-slash">lower the amount you pay for your fixed costs and regular bills</a>, you'll have more money available to build your emergency fund.</p> <p>But if you find that your income is barely enough to meet your necessary expenses and you don't have enough to save, you may want to consider getting an extra job on the side.</p> <h2>Set Your Savings Goal</h2> <p>Now that you know how much you can save, the next question to ask yourself is this &mdash; how much do you want to save?</p> <p>Dave Ramsey suggests that $1,000 is a good amount to start with. In our example above, you're saving $100 each pay period, or $200 a month. That means it'll take you five months to create your emergency fund.</p> <p>Though $1,000 is a good start, most people don't think that's enough. An emergency fund that&nbsp;covers three to six months &mdash; or even a year's worth of expenses &mdash; has been recommended.</p> <p>Let's go back to our example above. If your monthly expenses total $3,400 ($1,700 x 2) and you want your emergency fund to protect you for three months, you'll need to save $10,200. By saving $200 each month, this will take 51 months, or four years and three months.</p> <p>Similarly, if you want ensure that your emergency fund will protect you for six months or a year, it'll take more time. Now after you look at this time horizon, you may get overwhelmed with a feeling of despair.</p> <p>But don't worry. That's why this last step is the most important.</p> <h2>Automate Your Savings</h2> <p>If you&nbsp;had to manually transfer money out of your checking account and into your emergency fund every month, you'd probably give up after a few months or find excuses to spend your money. Fortunately, there's a better, easier way.</p> <p>The simplest way to establish your emergency fund is by setting up an online savings account at a bank such as ING Direct or Ally Bank. After you open up an account, you can set up automatic transfers to occur from <a href="http://www.wisebread.com/7-banks-still-offering-free-checking-and-great-interest-rates">your checking account</a>. Since the money is out of your checking account, it'll be&nbsp;a bit harder for you to access, so you'll be&nbsp;less tempted to spend it.</p> <p>Here's an example of how this would work. If you get paid every other Friday, schedule your automatic transfer of $100 to occur on the following Tuesday. That way, in case there are issues with your direct deposit, you have a few days to cancel a transfer. Although this should rarely happen, it's nice to give yourself some wiggle room.</p> <p>Now you know how to establish your emergency fund step-by-step. By <a href="http://www.wisebread.com/pay-yourself-first-what-it-means-and-how-to-do-it">automating your savings</a>, your emergency fund will grow month after month, even while you sleep.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/darren-wu">Darren Wu</a> of <a href="http://www.wisebread.com/a-step-by-step-guide-to-creating-your-emergency-fund">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/managing-your-short-term-money">Managing Your Short-Term Money</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/pay-yourself-first-what-it-means-and-how-to-do-it">Pay Yourself First: What It Means, and How to Do It</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-4-smartest-things-to-do-with-an-inheritance">The 4 Smartest Things to Do With an Inheritance</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/contingency-plans">Contingency Plans</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/when-to-use-savings-to-pay-off-debt">When to Use Savings to Pay Off Debt</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance automatic savings emergency fund savings account Fri, 18 Jan 2013 11:24:35 +0000 Darren Wu 962984 at http://www.wisebread.com 5 Best Online Savings Accounts http://www.wisebread.com/5-best-online-savings-accounts <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-best-online-savings-accounts" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/couple_using_laptop_iStock_000020548690Small.jpg" alt="couple using laptop for banking" title="" class="imagecache imagecache-250w" width="250" height="188" /></a> </div> </div> </div> <p>Having a savings account is pretty much taken as an article of faith among those in the personal finance world. You are supposed to have a savings account &mdash; and you are supposed to look for the highest yield or interest rate.</p> <p>In many cases, the highest yield is likely to come from an online source because of their limited services and low overhead.</p> <h2>Pros and Cons of Online Savings Accounts</h2> <p>Before you decide to open an online savings account, it's important to research your options and understand the realities that come with online savings accounts.</p> <p><strong>Better Interest Rates</strong></p> <p>The main advantage to an online savings account is the higher yield. Traditional brick and mortar banks are paying yields of between 0.1% and 0.3% right now. But if you put your money in an online savings account, you could earn a yield of around 1%. While this is hardly "high yield" when compared with the 4% and 5% yields common prior to 2008, it is still better than what you will get at a brick and mortar bank.</p> <p><strong>Inconvenient Access to Funds</strong></p> <p>The biggest downside to an online savings account is your access to the funds.</p> <p>While you can mail paper checks to some online banks for deposit, it's more common to transfer money from your checking account into your online savings account. And, if you want to withdraw your money, chances are that you need to transfer it from your online savings account to your primary checking account. This can take three to four business days &mdash; which can problematic if you need your money immediately.</p> <p>Some online savings accounts have ways around this, though. You might be able to link your online savings account with an online checking account with the same bank. You can then instantly transfer the money to the linked checking account and use the debit card to withdraw the money from the online checking account.</p> <p>Finally, there are some banks that will send you an ATM card for use in withdrawing money from your account. You need to be careful in these cases, since you might end up paying ATM fees. Your bank might not charge you, but the bank that owns the ATM may. Some online banks reimburse consumers for all fees, though. This can be a way to access your money quickly and conveniently without worrying about ATM fees.</p> <h2>Which Online Savings Accounts Are the Best?</h2> <p>When deciding which online savings account is likely to work best for you, start out by looking at interest yields. You need to look beyond the <a href="https://en.wikipedia.org/wiki/Annual_percentage_yield" target="_blank">Annual Percentage Yield</a> (APY), though. Some of the items to consider include:</p> <ul> <li>Minimum balances</li> <li>Fees</li> <li>Introductory periods</li> <li>Customer service</li> <li>FDIC insurance</li> </ul> <p>With an online savings account, it is also important to consider how you will manage your funds. An easy-to-navigate website is essential if you plan to do the bulk of your banking via the Internet. Many online banks provide live chat so that customers can contact support quickly and easily.</p> <p>Here are the best online savings accounts, all of which are FDIC-insured.</p> <h2>Discover</h2> <p><a target='_blank' href='http://www.dpbolvw.net/click-2822544-11035571-1443704483000?sid=mmarquit-961470'><img border="0" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u784/discover.gif" style="float:right;margin:0 5px 5px 10px;"/></a>You might know Discover for its credit card offerings, but Discover has a banking division, and you can open an online savings account with a yield of 1.20%. Discover also offers a money market account with an APY of 1.05%, and a five-year CD with competitive 2.25% APY.</p> <p>There is no minimum balance to open or maintain an account, and no monthly maintenance fees. Finding the customer service information is a little more difficult on the Discover site, but you can call 24/7 or send an email.</p> <p><a target='_blank' href="http://www.dpbolvw.net/click-2822544-11035571-1443704483000?sid=mmarquit-961470"><strong>Click here to open an account now!</strong></a></p> <h2>Capital One 360</h2> <p><a target="_blank" rel="nofollow" href="http://www.tkqlhce.com/click-2822544-11842865-1404445111000?sid=mmarquit-961470"><img width="168" height="48" alt="Click here to apply now" style="float:right;margin:0 5px 5px 10px;" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/wisebread/banners/bank_capone360.png" /></a>Formerly known as ING Direct, Capital One 360 (<a href="http://www.wisebread.com/capital-one-360-review?ref=internal">detailed review here</a>) offers the same great rates and service. Just like before, there are no fees and no minimums to open an account. Plus, if you're already a Capital One checking customer, your accounts can be automatically linked. Transfers are free and easy. The current APY is <a href="http://www.tkqlhce.com/click-2822544-11842865-1404445111000?sid=mmarquit-961470" target="_top"><script src="https://home.capitalone360.com/js/accounttype.js"></script> <script>document.write(type_3000_apy);</script> </a> % APY.</p> <p><a target="_blank" rel="nofollow" href="http://www.tkqlhce.com/click-2822544-11842865-1404445111000?sid=mmarquit-961470"><strong>Click here to open an account today!</strong></a></p> <h2>Ally</h2> <p><img width="125" height="125" alt="Click here to apply now" style="float:right;margin:0 5px 5px 10px;" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/wisebread/banners/bank_ally.jpg" />Ally Bank offers a savings account with a yield of 0.99% annually. There is no minimum account balance required to receive that rate of interest, and you don't need to maintain a particular balance to avoid fees. Ally offers a number of savings products, including options for high-yield CDs and IRAs.</p> <p>This bank generally receives high marks for customer service. The website is easy to navigate, and you can call customer service anytime of the day, as well as access live chat.</p> <h2>EverBank</h2> <p>One of the more interesting banks right now is EverBank. If you are a serious saver, this might be the right fit for you. The Yield Pledge Money Market account comes with a very attractive introductory rate: 1.40% for first-time account holders for the first six months on balances of $50,000 or less. That makes the first-year APY is as high as 1.01%. After that, EverBank promises that the yield will be in the top five nationally. The ongoing rate is 0.61%.</p> <p>You need $1,500 to open this account. You can move money up to 6 times a month. There is no monthly fee.</p> <p>In the end, you have to decide what you want from your online savings account. Consider your options and whether or not you will need immediate access to your money. Additionally, pay attention to minimums. It doesn't do you much good to open a high yield account if you don't have the balance to qualify you for the best rates.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/miranda-marquit">Miranda Marquit</a> of <a href="http://www.wisebread.com/5-best-online-savings-accounts">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/chase-total-checking-and-savings-easy-everyday-banking">Chase Total Checking and Savings: Easy Everyday Banking</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/capital-one-360-review">Capital One 360: A Competitive Banking Option</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/banks-still-offering-free-checking-and-great-interest-rates">Banks Still Offering Free Checking and Savings with Great Interest Rates</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-best-online-checking-accounts">5 Best Online Checking Accounts</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-savings-account-interest-rates-are-so-low">Why Savings Account Interest Rates Are So Low</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking credit cards online savings account savings account Fri, 11 Jan 2013 11:36:35 +0000 Miranda Marquit 961470 at http://www.wisebread.com Investments Worth Making With $50 or Less http://www.wisebread.com/investments-worth-making-with-50-or-less <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/investments-worth-making-with-50-or-less" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/2953824616_6c9ee4d2ac_z.jpg" alt="piggy bank" title="piggy bank" class="imagecache imagecache-250w" width="250" height="191" /></a> </div> </div> </div> <p>Having an extra $50 in your pocket can be a blessing or a curse, depending on how you use it.</p> <p>You could do something fun and treat yourself out to a nice dinner, blow it on a <a target="_blank" href="http://www.wisebread.com/playing-the-lottery-is-a-bad-gamble">lottery ticket</a> in the hope of getting more money, or find many other ways to enjoy the extra cash. The spending possibilities are endless. There's nothing wrong with enjoying spending money &mdash; it's one reason why people work so hard to earn it.</p> <p>But saving or investing it so you'll have it for a rainy day may be the smartest move, even if it's only $50. Putting $50 a month away in savings will at least get you in the habit of being a saver.</p> <p>No matter how you've come upon that $50 &mdash; by working a few hours, not buying lunch out for a week, or <a target="_blank" href="http://www.wisebread.com/cutting-the-cable-cord-has-more-than-financial-benefits">getting rid of cable</a> TV &mdash; there are plenty of ways to invest it for long-term savings. And I'm not talking about stock tips from your cubicle buddy that may not pan out. While some of these ideas are risky, my aim with this article is to highlight investments that can be started for $50 and can continue with regular deposits at least once a month. (See also:&nbsp;<a href="http://www.wisebread.com/investing-101-5-essential-steps">Investing 101: 5 Essential Steps</a>)</p> <h2>Savings Account</h2> <p>If you don't have one, this is the best place to start. Although interest rates are low, depositing money regularly into a savings account will get you on the right path to becoming a lifelong saver and not a spender. <a target="_blank" href="https://www.google.com/advisor/ussavings?bsp=1&amp;s=1&amp;kw=savings%20account%20calculator&amp;group=GenericRadio&amp;gclid=CJCpysDisLMCFQzhQgod8V0ADA&amp;q=savings+account+calculator&amp;b=E#!search&amp;Deposit+Range_D=50&amp;Account+Type_S=Regular+Savings&amp;Account+Type_S=Money+Market&amp;Zipcode_S=94518&amp;Issuer_S=__any__&amp;start=0&amp;si=0&amp;tknid=888826176">Search for a savings account</a> with a low minimum deposit, no fees, and the highest yield you can find, and start putting money there. Use a free online <a target="_blank" href="http://www.free-online-calculator-use.com/savings-account-interest-calculator.html">savings calculator</a> to determine how much you'll gain after a few years and regular deposits of $50 a month.</p> <h2>ETFs</h2> <p>Buying exchange-traded funds, or ETFs, is a way to buy stocks without all of the costs of mutual funds, says <a target="_blank" href="http://www.whitestreetadvisors.com/">Mike Sena</a>, a certified financial planner in Canton, Ga. Most mutual funds have an initial minimum purchase requirement of typically $2,500 or more, and investing $50 at a time can be unworkable, Sena says. Most every discount brokerage, such as <a href="https://us.etrade.com/home">E*Trade</a> and <a href="https://www.tdameritrade.com/home.page">TD Ameritrade</a>, have generous lists of commission-free ETFs that he recommends investing in until the investment reaches several thousand dollars.</p> <p>An ETF is traded on stock exchanges and trades throughout the day. While most brokers charge a small fee of less than $10 to trade them, there are plenty of ETFs without trading fees, though <a target="_blank" href="http://www.forbes.com/sites/investor/2012/02/13/are-commission-free-etfs-really-cheaper/">Forbes</a> warns investors may not be getting the best performing ETFs from brokers that don't charge fees.</p> <p>Sena recommends that for $50 a month, investments should be scattered among different types of companies, from a large company ETF one month to a small one the next, and an international one and other types of ETFs in other months. Such investments should only be made after making sure you have an adequate emergency fund and little or no consumer debt, he says.</p> <h2>DRIP</h2> <p>Joining a company's Direct Investment Plan, or DRIP, is a low-cost way to invest in an individual stock on a regular basis without having to go through a broker. Most <a target="_blank" href="http://www.directinvesting.com/drip_learning_center/how_to_enroll.cfm">DRIPs</a> don't charge fees for ongoing investments. Some require high minimum initial purchases, such as $500, so <a target="_blank" href="http://www.dripdatabase.com/Default.aspx">look for plans</a> with low minimums to start and that allow $50 purchases. You may have to save up for awhile to get to the initial purchase requirement.</p> <h2>Lending Club</h2> <p>Instead of putting your money in some big bank or company and not knowing where your money is going, loan money to your peers through <a href="https://www.lendingclub.com/">Lending Club </a>and avoid putting your money in a nameless, faceless bank. <a target="_blank" href="http://www.serenityfc.com/">Alan Moore</a>, a financial planner in Shorewood, Wis., recommends it as a great way to start investing partly because the initial investment can be made for $25. Loan returns range from <a target="_blank" href="https://www.lendingclub.com/landing/partner.action?partnerID=80019&amp;param2=540557371538032057e&amp;gclid=CNz20v3usLMCFY6DQgodWgIAqg">5.73% to 9.90%</a>, which is much better than a savings bond, CD, or <a href="http://www.wisebread.com/the-types-of-savings-accounts-which-is-right-for-you">other savings account method</a>. The loans can be risky, so it's a good idea to diversify with small loans to a variety of borrowers instead of loaning most of your investment with one person.</p> <h2>A Band</h2> <p>I promised to stay away from wacky investments, but <a target="_blank" href="https://www.sellaband.com/en/pages/how_it_works">SellaBand</a> is so intriguing that it may be worth $50 just for bragging rights. The site helps you find a hot, new artist to invest in. Initially an investment will get you free downloads, signed T-shirts, backstage passes, and other band swag. It's up to the band if you'll ever share in sales revenue. You may not get rich, but it's fun to say &quot;I'm with the band&quot; and really mean it.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/aaron-crowe">Aaron Crowe</a> of <a href="http://www.wisebread.com/investments-worth-making-with-50-or-less">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-25-free-for-opening-a-savings-account-with-5-05-interest">Get $25 FREE for opening a savings account with 5.05% interest. - UPDATED</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-ways-to-add-gold-to-your-portfolio">4 Ways to Add Gold to Your Portfolio</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-ways-etfs-can-put-more-money-in-your-pocket-than-mutual-funds">8 Ways ETFs Can Put More Money in Your Pocket Than Mutual Funds</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-10-weirdest-etfs-you-can-buy">The 10 Weirdest ETFs You Can Buy</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/are-you-choosing-the-right-fund-for-your-portfolio">Are You Choosing the Right Fund for Your Portfolio?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment exchange traded funds savings account small investments Mon, 26 Nov 2012 11:00:29 +0000 Aaron Crowe 955563 at http://www.wisebread.com The Lincoln Guide to Personal Finance http://www.wisebread.com/the-lincoln-guide-to-personal-finance <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-lincoln-guide-to-personal-finance" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/5255495593_f612c91c79_z.jpg" alt="Abraham Lincoln" title="Abraham Lincoln" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p>The Treasury Building is just a short walk from the White House, making it an easy stop for any president to visit.</p> <p>President Abraham Lincoln, who invested most of his presidential salary in Treasury bonds, didn't visit the Treasury Department often. But he did get there often enough to save most of his salary for three years. (See also: <a href="http://www.wisebread.com/receiving-your-tax-refund-in-savings-bonds">Receiving Your Tax Refund in Savings Bonds</a>)</p> <p>The <a href="http://thelincolnmovie.com/">movie &quot;Lincoln&quot;</a> opens nationally on Nov. 16, and while it provides historical lessons, the former president's <a href="http://www.wisebread.com/investing-101-5-essential-steps">investment methods</a> can be a good study of sound personal finance advice.</p> <p>Saving almost all of your salary is nearly impossible, but as the president showed, regular investments are a good start to a healthy portfolio.</p> <p>Lincoln stopped by the Treasury Building each month and &quot;counted out what money he was able to spare from his salary&quot; and invested in bonds, according to then-Treasury official Levi Gould, who helped Lincoln with his investments, as quoted in the 2006 book &quot;<a href="http://quod.lib.umich.edu/l/lincoln2/5250244.0001.001">Personal Finances of Abraham Lincoln</a>.&quot;</p> <p>Lincoln invested almost all of his $25,000 annual salary in governmental bonds, with $68,000 in total assets from his three years in office, according to a website run by the <a href="http://www.mrlincolnswhitehouse.org/inside.asp?ID=166&amp;subjectID=4">Lincoln Institute</a>.</p> <p>One day the president arrived at the office of the Secretary of Treasury and threw a mass of governmental notes on the secretary's desk, instructing that they be converted into bonds. His holdings in government obligations totaled $54,515, along with a bag of gold worth $883 that he brought to be Treasury Department. The assets were: $16,000 of 7-30 notes, $26,181 of <a href="http://www.wisebread.com/the-types-of-savings-accounts-which-is-right-for-you">certificates of deposit</a>, $8,000 of 5-20 bonds, $4,044 in salary warrants, and $489 in cash.</p> <p>Anyone who has received a savings bond certificate as a birthday gift &mdash; though they're now all electronic and can be given as a <a href="http://www.treasurydirect.gov/indiv/planning/plan_gifts_certificates.htm">gift certificate</a> to be redeemed &mdash; knows that getting a $25 savings bond is almost as exciting as getting new socks. While the payments for the <a href="http://www.treasurydirect.gov/indiv/products/products.htm">various Treasury securities</a> aren't exciting, they do provide long-term interest and give you the satisfaction that you're helping the country account for its debt. Even <a href="http://www.treasurydirect.gov/kids/kids.htm">children</a> can understand it.</p> <p>Treasury bonds, for example, pay a fixed rate of interest every six months until they mature in 30 years. The types of Treasury notes that Lincoln bought can still be bought today, though at different rates. T-Notes also pay a fixed term of interest every six months until they mature. They're issued in terms of 2, 3, 5, 7, and 10 years. <a href="http://www.treasurydirect.gov/RI/OFNtebnd">Recent rates</a> on bonds and notes ranged from 0.375% interest rate for a 3-year note to 3% interest on a 29-year bond.</p> <p>Lincoln did well with his bonds. The 7-30 notes, called &quot;seven-thirties,&quot; paid at a rate of 7.3% &mdash; two cents a day on $100 &mdash; that was payable in gold semi-annually. The government issued $140 million in Treasury Notes in 1861 to finance the Civil War.</p> <p>The 5-20 bonds that the president bought were redeemable after five years and matured at 20 years. They paid 6% interest payable in gold on May 1 and Nov. 1.</p> <p>Lincoln followed the rule billionaires such as Warren Buffett have followed &mdash; reinvest any interest payments. Whenever Lincoln, according to the <a href="http://quod.lib.umich.edu/l/lincoln2/5250244.0001.001/1:17.4?rgn=div2;view=fulltext">book on his finances</a>, was paid interest in gold, he sold the gold to the Treasury Department and used the proceeds to buy more bonds or loans to the government at interest rates of 4 to 6%.</p> <p>The president received almost $10,000 in interest and premiums on savings from his salary that he reinvested almost in its entirety, according to the book.</p> <p>Like any busy president, Lincoln apparently didn't have time to get to the bank often enough. He must have been doing well enough not to need to cash his pay &quot;warrants,&quot; according to biographers, with four uncashed paychecks found in his desk after his death.</p> <p>If you have four paychecks sitting in your desk that you haven't deposited yet, follow Lincoln's likely advice and go invest them in some government bonds.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/aaron-crowe">Aaron Crowe</a> of <a href="http://www.wisebread.com/the-lincoln-guide-to-personal-finance">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-best-online-savings-accounts">5 Best Online Savings Accounts</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-25-free-for-opening-a-savings-account-with-5-05-interest">Get $25 FREE for opening a savings account with 5.05% interest. - UPDATED</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-foolproof-ways-to-protect-your-money-from-inflation">4 Foolproof Ways to Protect Your Money From Inflation</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/investments-worth-making-with-50-or-less">Investments Worth Making With $50 or Less</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-take-out-a-loan-backed-by-your-investments">Should You Take Out a Loan Backed by Your Investments?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking Investment Lincoln savings account treasury bonds Fri, 16 Nov 2012 10:36:39 +0000 Aaron Crowe 955793 at http://www.wisebread.com 50 Great Things to Do With $50 http://www.wisebread.com/50-great-things-to-do-with-50 <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/50-great-things-to-do-with-50" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/5227459764_17413e4738_z.jpg" alt="guys on a couch" title="guys on a couch" class="imagecache imagecache-250w" width="250" height="188" /></a> </div> </div> </div> <p>There&rsquo;s not much you can buy for a dollar these days, but 50 big ones can still score you something pretty decent.</p> <p>From funding in a Kickstarter campaign to updating your kitchenware to pampering your pet, here are 50 ideas on how you can spend half a Benjamin and not feel too bad about it. (See also: <a href="http://www.wisebread.com/10-smart-things-to-do-with-25">10 Smart Things to Do With $25</a>)</p> <h3>1. Pick Up a Nice Bottle of Wine</h3> <p>Stop drinking the cheap stuff. Splurge for a better bottle, and make tonight a special occasion just because.</p> <h3>2. Tip Your Service Provider(s)</h3> <p>Did you give your mail carrier, door attendant, super, or other service provider a tip during the holiday season? If not, use the extra money as an opportunity to make amends.</p> <h3>3. Replace Old Pots and Pans</h3> <p>Kitchenware isn&rsquo;t cheap, but there are times when you can score great deals on skillets and other cooking essentials. If something you need falls below $50, go for it.</p> <h3>4. Catch Up on Bills</h3> <p>If you&rsquo;re behind on bills, put the money toward what you owe. Even if it&rsquo;s not the full amount, it still counts. You don&rsquo;t want to rack up any more late fees, do you?</p> <h3>5. Take a Friend to the Movies</h3> <p>A matinee might not cost the full $50, but an evening show with drinks and popcorn will come pretty darn close. Just make sure you invite a friend who&rsquo;s worth it.</p> <h3>6. Have Your Oil Changed</h3> <p>Haven't you put this off long enough?&nbsp;</p> <h3>7. Stock Up on Toiletries and Grooming Products</h3> <p>Toothpaste, deodorant, and hair products are all pricey. Stock up now, and put these items away until you run out of what you already have.</p> <h3>8. Invest in the Stock Market</h3> <p>Open an E-Trade account, and buy stock in an up-and-coming company whose shares are at basement-level prices.</p> <h3>9. Donate to Charity</h3> <p>I prefer support local charities instead of national organizations because I feel like my money will directly impact someone needy in my community.</p> <h3>10. Go Grocery Shopping</h3> <p>Is your fridge almost empty? Make a stop at the supermarket to grab good food to make yourself a few nice meals.</p> <h3>11. Treat Yourself to New Clothes</h3> <p>I recently bought myself a new pair of shorts for summer. They were a much smarter and cheaper purchase than the sneakers that I was eyeing up. Although I still have my fingers crossed on the sneakers; my birthday is coming up, and I sent a tip to the Birthday Fairy informing him about the shoes.</p> <h3>12. Make Goodies Boxes for Your Neighbors</h3> <p>Buy all the ingredients you need to make several batches of cookies or muffins, plus boxes, bags, baskets, and ribbons to make a nice presentation to give to your neighbors.&nbsp;</p> <h3>13. Buy a Bus Ticket and Visit Friends or Family</h3> <p>Greyhound has affordable prices. I scored a ticket from NYC to Baltimore for this weekend for $48 round trip.</p> <h3>14. Score Tickets to an Event</h3> <p>You can find cheap tickets to sporting events and concerts on StubHub. Browse the selection, and find something cool that&rsquo;s within your budget.</p> <h3>15. Send Your Mom a Present</h3> <p>Seriously, don&rsquo;t forget. <a href="http://www.wisebread.com/free-ways-to-celebrate-mothers-day">Mother&rsquo;s Day</a> is in less than two weeks.</p> <h3>16. Help Fund a Kickstarter Project</h3> <p>You never know &mdash; your gift might help someone create a product that will change the world. That&rsquo;d be pretty cool to be a part of.</p> <h3>17. Plan a One-Night Staycation</h3> <p>Book an available room or apartment nearby using Airbnb. It&rsquo;ll be like spending the night at a hotel &mdash; but for waaaay less.</p> <h3>18. Give It to Your Partner or Kids</h3> <p>Under one condition &mdash; they must leave the house for the better part of the day so you can relax.</p> <h3>19. Hire Someone to Clean Your House</h3> <p>Yes, you should probably do this yourself. But why bother when someone else is willing to do it for you?</p> <h3>20. Visit a Local Spa</h3> <p>Day passes are usually between $30 and $50, which gives you access to everything the facility has to offer. This is a great way to unwind and de-stress.</p> <h3>21. Schedule a Hair Appointment</h3> <p>Get a quick &rsquo;do update.&nbsp;</p> <h3>22. Splurge on a New Video Game</h3> <p>I would suggest buying two games for less than $25 rather than one game at $50. My way means double the fun.</p> <h3>23. Purchase Fresh Pillows</h3> <p>When was the last time you replaced the pillows on your bed? Pick up a couple quality head-resters and look forward to a good night&rsquo;s sleep.</p> <h3>24. Snag a Few Daily Deals</h3> <p>Check Groupon, LivingSocial, and other deal sites to find money-saving offers and activities in your neck of the woods.</p> <h3>25. Buy New Socks and Underwear</h3> <p>It&rsquo;s time to retire some of your rattier undergarments and replace them with undies and socks that your sweetie actually wants to see you in.</p> <h3>26. Start a _____________ Fund</h3> <p>Have your eye on something that costs more than $50? Start a fund specifically for that item with the $50 you have now.</p> <h3>27. Pamper Your Pet</h3> <p>Treat your pet to a day of play and a few new toys and goodies.&nbsp;</p> <h3>28. Have Your Car Detailed</h3> <p>Keeping it clean will help with resale value down the road.</p> <h3>29. Start a Garden</h3> <p>I recently went to Home Depot and bought a plastic tub, dirt, and herb seeds to grow a small garden on my roof.</p> <h3>30. Update Your iPad</h3> <p>Buy a few new movies, books, music downloads, or apps.</p> <h3>31. Spring for Two New Ties</h3> <p>You should always look good at the office. And if you&rsquo;re paying more than $25 per tie, you&rsquo;re shopping at the wrong stores.</p> <h3>32. Gas Up the Car</h3> <p>Hurry, before prices start climbing again.</p> <h3>33. Order a Disaster Kit</h3> <p>Better safe than sorry. This pre-packed disaster kit might very well save your life or help you save someone else&rsquo;s.</p> <h3>34. Adopt a Dog or Cat</h3> <p>Visit your local shelter to fall in love with a wonderful dog or cat in need of a forever home.</p> <h3>35. Send Your Grandmother a Gift</h3> <p>She&rsquo;s not your mom, but she&rsquo;s still a mother &mdash; and she loves you like you were her own. Show her your appreciation by sending her something that will make her day.</p> <h3>36. Take Cold-Weather Coats and Sweaters to the Dry Cleaner</h3> <p>Have the items cleaned now so they&rsquo;re ready to wear come fall.</p> <h3>37. Join a Social Sports League</h3> <p>I&rsquo;ve played social sports (dodgeball, kickball, bowling) in two cities, and each league was $50 or less to join. Plus, you get to make friends while you&rsquo;re having fun. Totally worth the investment.&nbsp;</p> <h3>38. Plan a Date Night at Home</h3> <p>If you have On Demand, you can purchase pre-theater movies on your TV. They cost a bit more than the just-released titles &mdash; some can be up to $14.99 &mdash; but it&rsquo;s worth the money if it&rsquo;s a film you would have seen in theater anyway. Pick up some junk food too. Before the show starts, make munchies and milkshakes.</p> <h3>39. Add an Extra-Special Touch to a Getaway</h3> <p>If you&rsquo;ve already <a href="http://www.wisebread.com/how-to-book-an-amazing-cheap-vacation-package">planned a vacation</a>, look into adding something more romantic to the package. B&amp;B owners in particular are generally open to helping you enhance your stay with candlelight dinners, picnics, and other activities. I&rsquo;m sure you can find just the right thing for $50 or less.</p> <h3>40. Renew a Membership or Subscription</h3> <p>Whether it&rsquo;s a membership to a wholesale club or a subscription to your favorite magazine, update it now while you have the extra cash.</p> <h3>41. Make It Rain</h3> <p>Do you know what it feels like to drop money on unsuspecting people? Find out by going to your local mall with a pocket full of one-dollar bills and making it rain. You&rsquo;ll puts smiles on lots of faces, and you might even get away with it if you hightail it out of there before security catches up with you.</p> <h3>42. Buy Supplies for a Local School</h3> <p>I know needy school kids along with teachers who have to buy all their own classroom supplies. Help students and educators out by picking up school supplies that the whole class can enjoy and dropping them off.&nbsp;</p> <h3>43. Book a Massage Appointment</h3> <p>You may have to do your research to find a masseur who will give you a massage for less than $50, but even if the hour price is out of your budget you can ask if he or she offers more affordable 30-minute sessions.</p> <h3>44. Put It Into a Savings Account</h3> <p>Of course this is no fun, but it is the responsible thing to do. You never know when you might need that $50.</p> <h3>45. Make Repairs Around the House</h3> <p>I&rsquo;m sure there are a few small projects you&rsquo;ve neglected. Maybe it&rsquo;s replacing a few light bulbs or batteries, or perhaps you need organization supplies to clean up the garage. Whatever it is, make it your mission to take care of it with your $50.</p> <h3>46. Do Something You&rsquo;ve Never Done Before</h3> <p>Try a new restaurant. See a new show. Find something in your area that you haven&rsquo;t done yet and do it.</p> <h3>47. Create a Work of Art for Your Home</h3> <p>Pick up a blank canvas and a few supplies and channel your inner Andy Warhol.</p> <h3>48. Hide It In Your Wallet for a Rainy Day</h3> <p>Out of sight, out of mind. Hide a $50 bill in your wallet to use in emergencies. Much better than having to swipe the plastic.</p> <h3>49. Get a Tattoo</h3> <p>This isn&rsquo;t for everybody, but you can get a small tattoo for around $50 if you want one.</p> <h3>50. Play Blackjack</h3> <p>It&rsquo;s a risk, but if you know what you&rsquo;re doing you can double your money in an instant.</p> <p><em>Tell me, what would you do with an extra $50 in your pocket? Let me know in the comments below.</em></p> <h2 style="text-align: center;">Like this article? Pin it!&nbsp;</h2> <p>&nbsp;</p> <p style="text-align: center;"><a href="//www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F50-great-things-to-do-with-50&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F50%20Great%20Things%20to%20Do%20With%2050.jpg&amp;description=50%20Great%20Things%20to%20Do%20With%2050" data-pin-do="buttonPin" data-pin-config="above" data-pin-color="red" data-pin-height="28"><img src="//assets.pinterest.com/images/pidgets/pinit_fg_en_rect_red_28.png" alt="" /></a> </p> <!-- Please call pinit.js only once per page --><!-- Please call pinit.js only once per page --><script type="text/javascript" async defer src="//assets.pinterest.com/js/pinit.js"></script></p> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/50%20Great%20Things%20to%20Do%20With%2050.jpg" alt="50 Great Things to Do With $50" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/50-great-things-to-do-with-50">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-to-resist-a-splurge">6 Ways to Resist a Splurge</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/debit-or-credit-which-one-should-you-choose-at-the-checkout">Debit Or Credit? Which One Should You Choose At The Checkout?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-simple-ways-to-stop-impulse-buying">9 Simple Ways to Stop Impulse Buying</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-effortless-ways-to-prevent-budget-busting-impulse-buys">7 Effortless Ways to Prevent Budget-Busting Impulse Buys</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-is-how-americans-spent-their-money-in-the-1950s">This Is How Americans Spent Their Money in the 1950s</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Shopping savings account Splurge things to do Mon, 07 May 2012 10:36:08 +0000 Mikey Rox 926072 at http://www.wisebread.com What I Wish I Had Known When I Started Living Frugally http://www.wisebread.com/what-i-wish-i-had-known-when-i-started-living-frugally <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-i-wish-i-had-known-when-i-started-living-frugally" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/wisebread_whatIwishIhadknown.jpg" alt="Magic 8 Ball" title="Magic 8 Ball" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p>I&rsquo;ve always been a fairly frugal person. I didn&rsquo;t decide to be frugal one day or make a resolution on January 1 of any particular year. Evolving in the &quot;frugal arts&quot; has been more a path of gentle reminders and little lessons that have kept me on the straight and narrow. But early on, there was so much I didn&rsquo;t know. As a younger person in my early twenties, frugality was a guiding, albeit much grayer concept, and I had no idea of the wide network of people who were following a similar path and having similar struggles.</p> <p>If I could speak one-on-one to that fresh-faced 22-year-old just out of college, there&rsquo;d be a few pieces of advice I&rsquo;d give on the topic of frugal living &mdash; advice that might have saved him some stress, confusion, and money. (See also: <a href="http://www.wisebread.com/the-two-biggest-mistakes-people-make-when-starting-to-live-frugally">The Two Biggest Mistakes People Make When&nbsp;Starting to Live Frugally</a>)</p> <h3>It Gets Easier</h3> <p>Frugality is a skill. The more you practice, the easier it gets. Eventually, whole categories of expenses will buckle and fall to your instant and flawless number-crunching. Meanwhile, enjoy the small pleasures and keep your eye on the prize.</p> <h3>It&rsquo;s Not Necessarily How Much You Make; It&rsquo;s How Much You Save</h3> <p>Our society puts so much emphasis on making money and very little on saving it. Most people think the path out of money problems or the road to a more secure financial future is paved with higher-paying jobs. While there&rsquo;s certainly nothing wrong with career advancement, without the fundamental skills on how to manage it, more money often means just more spending and bigger debt. But even with a very modest income, amazing feats of savings can be achieved with the right mindset and discipline. In short, never be fooled into thinking that you make too little to save, and never be lulled into believing that you make so much that you can catch up later.</p> <h3>Frugality Is Even More Important Than You Think It Is</h3> <p><a href="http://www.wisebread.com/5-dreams-you-wont-achieve-unless-you-live-below-your-means">Living within your means</a>, living simply, and saving for goals and for retirement are important in ways you can&rsquo;t even conceive of yet. As you get older, you&rsquo;ll thank yourself for saving early, avoiding debt, and letting the magic of compounding interest do much of work for you. Though money isn&rsquo;t everything, being on the wrong side of 40 is just a little bit &ldquo;righter&rdquo; when you have a firm grasp on the financial fundamentals.</p> <h3>There Are Young People Just Like You; You&rsquo;re Part of a Movement</h3> <p>Though the idea of frugality may, at times, feel like the quaint sport of an older generation, take comfort &mdash; you&rsquo;re not alone. In about ten years everyone will be connected via a network of personal computers, and you&rsquo;ll see on a global level just how many folks are spurning over-consumption, living simply, and talking and writing about frugality. Stay tuned.</p> <h3>Frugality, Simplicity, and Sustainability Are All Petals on the Same Flower</h3> <p>It sometimes takes years to reach a vantage point where you can see how ideas are connected. Though they sometimes seem abstract, <a href="http://www.wisebread.com/frugality-simplicity-and-sustainability">frugality, simplicity, and living sustainably</a> are all part of the same idea. It&rsquo;s nearly impossible to live a truly frugal life without simplifying and being mindful of the environment and sustainability concerns. As you grow into your lifestyle and connect with others, you&rsquo;ll finally begin to see just how cohesive all of your disparate interests actually are.</p> <h3>Oh...and There&rsquo;s a Big Recession Coming</h3> <p>Crystal ball time &mdash; in about 20 years, through a series of global financial missteps, the whole economic house of cards will tumble. Small successes now and larger lessons later will inform how prepared you are and how much of a personal adjustment you&rsquo;ll have to make in response to some serious new economic realities. (Meanwhile, don&rsquo;t invest in anything called &quot;OTC derivatives.&quot;)</p> <p>Hindsight, as they say, is 20/20. Whatever lessons I&rsquo;ve managed to learn so-far have come at the right time and in largely the right way. I wonder though, if I were to have a similar conversation with myself 20 years from now, what would my 65-year-old self have to say?</p> <p><em>What do you wish you had known when you started on your frugal path? What&rsquo;s the most valuable thing that frugal newbies should know?&nbsp;</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/kentin-waits">Kentin Waits</a> of <a href="http://www.wisebread.com/what-i-wish-i-had-known-when-i-started-living-frugally">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/volunteer-to-travel-11-opportunities-for-free-or-very-cheap-travel">Volunteer to Travel: 11 Opportunities for Free or Very Cheap Travel</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/book-review-wabi-sabi-simple">Book review: Wabi Sabi Simple</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-step-by-step-guide-for-when-friends-ask-for-help-being-frugal">A Step-by-Step Guide for When Friends Ask for Help Being Frugal</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-beginner-s-guide-to-frugal-living">A Beginner’s Guide to Frugal Living</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/simplicity-and-being-cheap">Simplicity and being cheap</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Lifestyle beginning frugality community savings account simplicity Tue, 06 Mar 2012 11:24:17 +0000 Kentin Waits 909695 at http://www.wisebread.com Beware the Small Print of High Interest Savings Accounts http://www.wisebread.com/beware-the-small-print-of-high-interest-savings-accounts <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/beware-the-small-print-of-high-interest-savings-accounts" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock_000005407438XSmall_ArchMen_percent_blocks.jpg" alt="several sized blocks with percent signs" title="Beware of what&#039;s inside a high-interest rate savings account" class="imagecache imagecache-250w" width="250" height="212" /></a> </div> </div> </div> <p>How many times have you seen ads for savings accounts that have touted superb interest rates?&nbsp; And how many times have you looked into the offer only to discover that it isn&rsquo;t quite what it seemed to be initially?</p> <p>I&rsquo;m not saying there are no good deals out there to be found.&nbsp; For instance, a savings product like the HSBC Advance Online Savings Account still offers a rate that&rsquo;s higher than the what an average bank account offers, plus low fees and no minimum balance requirements. However, it pays to be careful and to keep your eyes and ears open and your brain engaged when you are shopping for a place to park your cash. Those tempting posters and advertisements have always got small print &ndash;- and it&rsquo;s the small print that you really need to look at more closely.</p> <h2>Give Your Savings Account a Second Look</h2> <p>Here are some reasons why savings accounts with superb rates aren&rsquo;t always the delightful find you thought they were.</p> <p><strong>1. They require a monthly savings contribution.</strong></p> <p>Some institutions may require you to contribute an amount each month to your account. This may be ideal if you've got a handle on your outgo, if you&rsquo;ve got a good budget and you know how much cash you&rsquo;ve got left over each month.&nbsp; But if you struggle to put away the same amount each time (or you even miss some months altogether) it&rsquo;s no good opting for this kind of savings account.&nbsp; Instead, you&rsquo;ll have to pass on the interest rate and settle for something less.&nbsp;For a savings account that&rsquo;s more customer-friendly, check out the Sallie Mae Bank Savings Account.</p> <p><strong>2. The interest rate includes a &quot;bonus&quot; that disappears after the first year.</strong></p> <p>The good thing about these savings accounts is that for a specific time period, you can reap the rewards from a better rate of interest.&nbsp; They very often have few limits and they allow you to take out your cash whenever you want to.&nbsp; But they&rsquo;re banking on the fact that you will forget to close the account and go elsewhere with your money.&nbsp;If you do opt for this kind of account, and you're really only after that rate boost in the beginning, then make sure you mark the anniversary on your calendar and move your money elsewhere when the intro rate expires.</p> <p>In my case, I prefer to choose an account that still offers a high yield with or without the bonus tacked on.&nbsp; I also look at savings accounts that have other things going for it -- say, if they are part of an institution that has a great reputation, has a brokerage arm and has other interesting investment products to offer.&nbsp; EverBank is an online bank which offers accounts with initial interest rate boosts but also offers a great variety of investment products as well.</p> <p><strong>3. You don't get the stated interest unless you lock up your money for a given term.</strong></p> <p>An example of such an account is one that only pays out the advertised interest if you deposit your money and don&rsquo;t touch it for four or five years.&nbsp; Now there is nothing wrong with this in principle, if you are quite willing to tie up your money for this long.&nbsp; But you wouldn&rsquo;t choose this kind of account as your main savings account.&nbsp; You should only consider it if you've already got a designated account that gives you more liquidity and that perhaps, contains your rainy day money.&nbsp; If this is the case, you can enjoy getting a better rate of interest on any cash you are willing to tie up for a few years.</p> <p><strong>4. The account's interest rates change way too frequently.</strong></p> <p>How stable is that interest rate?&nbsp; Perhaps you are lured to a savings account because of its interest rate advertisement.&nbsp; At times, this type of fluctuation may seem to be a positive thing, particularly if <a href="http://www.wisebread.com/when-interest-rates-head-up">rates are going up</a>.&nbsp; But what if the trend is downward?&nbsp; If you&rsquo;re using the rate as your primary reason for choosing an account, you may be disappointed later on when you find that the account&rsquo;s rate changes quite a bit over time.&nbsp; So if you&rsquo;ve pegged your hopes on a particular rate, it may not necessarily last.&nbsp;</p> <h3>Be Aware of the Hidden Costs</h3> <p>As you can see, there are some good deals to be had on savings accounts, even today when the interest rates are incredibly low.&nbsp; But you need to be prepared to give up something else in order to get them &ndash;-&nbsp; whether that is access to your cash, a good rate for an extended period of time or something else.</p> <p>This means that you have to consider all aspects of every account before making your decision on which one is the best savings account for you.&nbsp; We all want our money to work for us and we want to get the best returns for it that we can.&nbsp; But sometimes we also need to know where to draw the line.&nbsp; Otherwise, we could end up getting tied to something that we really don&rsquo;t need.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/silicon-valley-blogger">Silicon Valley Blogger</a> of <a href="http://www.wisebread.com/beware-the-small-print-of-high-interest-savings-accounts">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-25-free-for-opening-a-savings-account-with-5-05-interest">Get $25 FREE for opening a savings account with 5.05% interest. - UPDATED</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/are-you-paying-these-6-unfair-banking-fees">Are You Paying These 6 Unfair Banking Fees?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-best-online-savings-accounts">5 Best Online Savings Accounts</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/capital-one-360-review">Capital One 360: A Competitive Banking Option</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-places-to-keep-your-money-safe-and-growing">12 Places to Keep Your Money Safe — And Growing</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Banking bank account banking savings savings account Fri, 24 Sep 2010 14:00:07 +0000 Silicon Valley Blogger 246122 at http://www.wisebread.com Living Well on a Feast to Famine Income http://www.wisebread.com/living-well-on-a-feast-to-famine-income <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/living-well-on-a-feast-to-famine-income" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/2302807991_f07e42218a_z.jpg" alt="smiling family" title="smiling family" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Living on a fluctuating income can wreak havoc on a person's finances. I should know; my income is <a href="http://www.littlehouseinthevalley.com/living-on-an-erratic-income">slightly erratic</a> from season to season. From October through June, my income is steady and stable with an occasional fluctuation &mdash; a surge of income one month, or a great reduction the next. Then, from July through September, my income drops like a brick and remains lower than normal, but constant, over the summer months. What I've learned through trial, error, and a great many tears is that living on an erratic, fluctuating income means coming up with a plan many months before hitting the low point of the year. (See also: <a title="5 Tried-and-True Strategies for Saving When Your Income Isn't Consistent" href="http://www.wisebread.com/5-tried-and-true-strategies-for-saving-when-your-income-isnt-consistent">5 Tried-and-True Strategies for Saving When Your Income Isn't Consistent</a>)</p> <h3>Make a Plan; Set up a Budget</h3> <p><a title="8 Tips for Improving or Starting a Budget" href="http://www.wisebread.com/8-tips-for-improving-or-starting-a-budget">Setting up a budget</a> takes a little planning and getting into the habit of recording expenses and income. For instance, I use QuickBooks for my check register and categorize my expenses. I've set up categories for everything from rent to utilities to Starbucks. Since QuickBooks allows me to pull reports over time, I've been able to get a good idea of my average income for the year; a very important average for someone with an unstable income.</p> <p>Since I have accumulated a lot of data over the years, I have a good idea of an average income and expenses over a 5-year period. Not wanting to over-estimate my income in any given year, I take the lowest amount over a five-year period and base my monthly budget on that average (dividing the annual income by 12 months). This is my base salary that I work with. For instance, if my lowest annual income in a given 5-year range was $63,000, I can use the monthly average of $5,250 to portion out how much will go into each expense category: rent, utilities, insurance, car, groceries, savings, etc.</p> <p>Knowing that there's a good chance I might make more in one month than the next, I set aside the difference and plan ahead for the next month.</p> <h3>Create a Slush Fund</h3> <p>My budget dictates the expenses I must pay. However, in the months where I've ended up with a windfall, I set aside a portion of it in a &quot;Slush Fund&quot; account for next month's bills. My slush fund is basically a <a title="4 Things to Consider Before You Open an Online Savings Account" href="http://www.wisebread.com/4-things-to-consider-before-you-open-an-online-savings-account">savings account</a> that is connected with my regular checking account allowing me to easily transfer the money to and from accounts. One month I might be able to save a couple of thousand dollars in my slush fund, while the next, I might have to pull out most of the slush fund money if my income was insufficient.</p> <p>Obviously, I've learned the hard way that I must be diligent and stick to my budget for this method to work. Before I became financially savvy and responsible, I would spend all the windfall money one month, then freak out the next when I had trouble digging up enough dough to pay the rent. Living with the stress of not knowing how to pay the bills from one month to the next is not a fun way to live.</p> <h3>Save for a Rainy Day</h3> <p>One of my monthly budget categories is savings, which is different from my slush fund money. Every month, I set aside a small portion of my income towards a separate savings account no matter what money I have coming in. That way I have a solid emergency fund in case I encounter a couple of famine months in a row. If I happen to hit a streak of luck where windfalls just keep coming, I increase my savings amount and still set aside the majority of the extra money into my slush fund, anticipating a slower month in the future. I try to budget ten percent of my income towards savings; most months I can reach this goal.</p> <p>My idea behind the emergency fund money is it is only to be touched in an <a title="Emergency Plan: Better Than an Emergency Fund" href="http://www.wisebread.com/emergency-plan-better-than-an-emergency-fund">emergency</a>, like an unexpected visit to the vet or an unforeseen car repair. The only other time I allow myself to touch this fund is when I run into a couple of months of below normal income. However, my slush fund is usually sufficient to cover one month of expenses at the minimum, if not two. I've set up a separate online savings account for my emergency fund that makes it a little more difficult to access, reducing any spur of the moment loss of sanity spending spree.</p> <p>It took me quite a few years to figure out how to successfully live on a roller-coaster type income. Yet, recording my expenses and income and setting up a budget has made me realize it's not an impossible feat. Now that I understand I have to<em> save</em> the extra income in any given month has reduced my anxiety by allowing me a cushion of freedom.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/little-house">Little House</a> of <a href="http://www.wisebread.com/living-well-on-a-feast-to-famine-income">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/50-great-things-to-do-with-50">50 Great Things to Do With $50</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-ways-to-save-money-when-you-are-unemployed">10 Ways to Save Money When You Are Unemployed</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-same-actions-will-produce-the-same-results-ten-tenets-for-arranging-your-rich-part-2">The Same Actions Will Produce The Same Results (Ten Tenets for Arranging Your Rich: Part 2)</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/getting-by-without-a-job-part-1-losing-a-job">Getting by without a job, part 1--losing a job</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-awkward-money-moments-everyone-has-at-work">8 Awkward Money Moments Everyone Has at Work</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Career and Income Budgeting erratic income savings account slush fund Mon, 13 Sep 2010 12:00:13 +0000 Little House 235383 at http://www.wisebread.com 5 Tips for Easy College Savings http://www.wisebread.com/5-tips-for-easy-college-savings <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-tips-for-easy-college-savings" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/college savings.jpg" alt="college savings" title="saving for college" class="imagecache imagecache-250w" width="250" height="183" /></a> </div> </div> </div> <p>When you have a baby, there are many initial financial concerns, especially when a family is still working hard just to make ends meet. College savings on a tight budget may seem like something you'll do later when the kids start elementary school but time goes by so fast. The reality is by the time today's toddlers are in college, the <a href="http://www.wisebread.com/college/cost-of-college">costs of higher education</a> will be outrageous.</p> <p>To get a jump start on <a href="http://www.wisebread.com/college/saving-for-college" title="How to Save Money for College">saving money for college</a>, here are ideas for starting to save when kids are still young and money's still tight. Also check out our <a href="http://www.wisebread.com/college/college-resources">40+ College Resources for Parents and Students</a> to get more information.</p> <h2>Choose the Right Savings Plan for College</h2> <p>You can start the account in your child's name to save on taxes but be warned &mdash; if you are later eligible for <a href="http://www.wisebread.com/college/financial-aid" title="College Financial Aid">financial aid</a>, it can be cheaper to have the funds in your own name. Colleges expect contributions toward tuition to be 5-6% of your assets each year. Assets in a child's name are marked considerably higher at 20%. Savings bonds are also affected in this manner.</p> <h2>Balance the Budget</h2> <p>The earlier you start, the smaller increments you can deposit. If your child is still in elementary school, work through your <a href="http://www.wisebread.com/tricks-for-budgeting-as-parent" title="Budgeting Tricks for Parents">parenting budget</a> to find at least $50 a month to invest into a college account. Make a serious commitment to socking away $50 each month until the college years loom. It may seem like an insufficient amount but in 18 years time at 6% interest a year, that $50 a month can be worth around $20k.</p> <h2>Invest Extra Cash</h2> <p>Any windfalls in money (bonuses, inheritance, etc.) should have an allocation right off the top of at least an additional $50 to invest, if not more, into the college account. It can be easy to find uses for &quot;extra money&quot; but $50 is rather small and you'll feel better making that extra deposit during the month.</p> <h2>Automate Your Savings Plan</h2> <p>Psychologically speaking, you can save more when you see less. Talk to your payroll department about having $25 a check (if you get paid bi-monthly) deposited directly into the college account. After a month or so, you'll likely never even notice it is missing.</p> <h2>Look But Don't Touch</h2> <p>It's great to track your progress and see that $50 start adding up but don't touch it, not even for emergencies. Start a similar plan where you deposit money into an <a href="http://www.wisebread.com/figuring-the-size-of-your-emergency-fund" title="Figuring the Size of Your Emergency Fund">account for emergencies</a> like home or vehicle repairs. Since you have been dedicated to the savings process, a second account should be just as simple. It can be tempting to withdraw the money but consider instead how good it will feel when your child is getting ready to go off to college without additional financial stress on them &mdash; or you.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tisha-tolar">Tisha Tolar</a> of <a href="http://www.wisebread.com/5-tips-for-easy-college-savings">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-use-the-holidays-to-teach-kids-about-money">How to Use the Holidays to Teach Kids About Money</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/money-a-mess-try-this-personal-finance-starter-kit">Money a Mess? Try This Personal Finance Starter Kit</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-creative-uses-for-a-529-plan">5 Creative Uses for a 529 Plan</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-manage-your-money-during-a-spousal-separation">How to Manage Your Money During a Spousal Separation</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-surprising-way-birth-order-decides-your-money-habits">The Surprising Way Birth Order Decides Your Money Habits</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Family 529 plan budgeting college savings higher education costs savings account Mon, 30 Nov 2009 14:00:03 +0000 Tisha Tolar 3863 at http://www.wisebread.com Managing Your Short-Term Money http://www.wisebread.com/managing-your-short-term-money <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/managing-your-short-term-money" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/banknotes_1.jpg" alt="Actual, physical banknotes" title="Banknotes" class="imagecache imagecache-250w" width="250" height="128" /></a> </div> </div> </div> <p>It's easy to find books and articles on how to manage your money to support your long-term goals. You can read a lot about stocks and bonds, retirement accounts, investing in gold, real estate, options and futures. But managing your day-to-day spending money tends to get short shrift. Here's a primer.</p> <p>There are three big reasons to hold cash: Liquidity, short-term goals, and emergencies.</p> <h2>Liquidity</h2> <p>You need a certain amount of money on hand just to pay your bills. People whose bills are small and predictable can actually get by with very small liquidity balances--a student living in a dorm with a meal plan, for example, might only need to carry a liquidity balance big enough to keep him in sodas and pizza.</p> <p>If you've got a handle on your expenses, it's very easy to figure out what you need for a liquidity balance: It's the total of all the money you need to spend between now and the next time you'll get some income.</p> <p>Most people's expenses vary from month to month--you need less in spring and fall when you're not running the heat or the air conditioner, but you need more for the months the property taxes and insurance payments are due. You can, if you want, adjust your liquidity balances to match.</p> <p>My wife and I actually do that. Each month we know pretty accurately what our bills are going to come to: We know which months things like insurance bills need to be paid and we keep track of how much we've charged on our credit cards. Pretty much everything else except the electric bill is the same every month. Each month we figure out what we're going to have to pay out and make sure there's enough in the checking account to cover it.</p> <p>Most people don't bother--they just carry a liquidity balance that's big enough to handle their expenses in any ordinary month. Especially when interest rates are low, there's no problem with this. (When you can earn a significant return on your savings, there's a real cost to having money sit idle in your checking account. Right now, not so much.)</p> <h2>Short-term goals</h2> <p>While your budget should cover all your regular expenses--including things like tax and insurance bills that come just once or twice a year--there are things that you'll want to spend money on that aren't so regular. Still, except for emergences, most of the other things that you'll need cash for are nevertheless broadly predictable. You should have a plan for them, whether you structure it as part of your budget, or just as a <a href="http://www.wisebread.com/plan-for-your-wants">list of stuff you want</a>.</p> <p>A homeowner knows to expect (and gradually set aside money for) a new roof, furnace, air conditioner, appliances, carpets, repainting, and so on. Even though many of these expenses won't be incurred for ten or fifteen years, they're still expected. A car owner can include routine maintenance in the regular budget, but knows that an old car may need major repairs--and will in any case eventually need to be replaced. More broadly, everyone has things that they want--a vacation, a motorcycle, a musical instrument, a really good camera, a boat, the complete works of L.L. Zamenhof--that they're intending to get in the next few years.</p> <p>A few of these things may be medium- or even long- term goals--if you're not planning on buying them anytime soon. Roughly speaking, I'd call anything that you don't expect to spend any money on for 5 years a medium-term goal, and anything that you don't expect to spend any money on for 10 or more years a long-term goal.</p> <p>Money to support your medium- and long- term goals can be invested for the long term--in fact, much like you <a href="http://www.wisebread.com/optimize-your-ira-and-401k">invest for other long-term goals</a>, such as retirement. For short-term goals, though, you should mostly stick to cash.</p> <h2>Emergencies</h2> <p>Your liquidity balances cover your expected cash needs from paycheck to paycheck. Your emergency fund covers any <strong>unexpected</strong> cash needs--either unusual expenses (the water heater goes out and needs to be replaced) or a drop in income (your employer cuts your hours or lays you off).</p> <p>The usual rule of thumb is that you should have 3 to 6 months expenses in your emergency fund. (For an analysis of why and a look at some special cases, see my post <a href="http://www.wisebread.com/figuring-the-size-of-your-emergency-fund">Figuring the size of your emergency fund</a>.)</p> <h2>How to do it?</h2> <p>First, figure out how large your liquidity balance needs to be, and get that much money into your checking account. Then, each time you get paid, put enough money in the checking account to cover your budgeted expenses. If you find it more convenient to keep a larger liquidity balance, you can just put in an average amount each month (and then adjust once or twice a year). Or, if you prefer, you can figure out exactly how much your bills are going to be and pay in exactly that amount. Either way works fine.</p> <p>Second, top up your emergency fund. If your emergency fund is smaller than it ought to be--either because you had an emergency and spent some of it, or because it's never been as large as it should be--pay any surplus money you have after paying your bills into the emergency fund.</p> <p>Third, direct any remaining cash into whatever account you use to save for your short-term goals.</p> <p>That's really all there is to it. You can fund your longer-term goals at any point along the way:</p> <ul> <li>Before (through payroll deduction into your 401(k), for example),</li> <li>During (such as by sending money to a mutual fund at the same time you pay your bills),</li> <li>After (by accumulating savings until there's enough to buy 100 share of some stock you like).</li> </ul> <p>Pick <a href="http://www.wisebread.com/pay-yourself-last-is-okay-too">any combination of those methods</a> that seems like it'd work for you. (Just don't pick none of them.)</p> <h2>Where to keep your cash</h2> <p>There's no need to get fancy about your short-term money. All you really need is a transaction account of some sort for paying your bills. If it pays a good rate (and you're the sort of person who can keep track and not spend money just because it's there), you could even keep your emergency fund and your short-terms savings there as well.</p> <p>Most people prefer to have separate savings accounts for their emergency fund and the savings that they're accumulating for specific goals. A savings account at your local bank is fine. An internet savings account may pay a better rate. A money market fund is also a good choice.</p> <p>To the extent that you know that you're not going to use the money for a period of time (college savings, for example) you can put the money into CDs or short-term bonds with a maturity date that matches when you're going to need the money.</p> <p>It may be worth it to allow a bit more complexity to creep in. For example, I keep half my emergency fund in my local bank and the other half in the form of two 6-month <a href="http://www.wisebread.com/treasury-bills-for-ordinary-folks">treasury bills</a> with maturity dates 3 months apart. As long as I have no emergencies (or only small emergencies), I roll over each treasury bill as it matures. If there's an emergency, all I have to do is <strong>nothing</strong> and each maturing bill will pay a quarter of my emergency fund directly into my checking account. (At the moment I'd probably earn a better rate with that money in CDs at my local bank, but the setup has been so convenient, I've left it alone for now.)</p> <p>I also recommend that you keep some amount of <a href="http://www.wisebread.com/carry-some-cash">cash on hand in the form of actual banknotes</a>, even if you usually use credit or debit cards even for small purchases. There are some problems where the best solution is real cash money. Especially with interest rates as low as they are right now, there's no reason not to have some on hand. Think of it as part liquidity balance, part emergency fund.</p> <h2>It's still all your money</h2> <p>There are lots of reasons to divide your money up into multiple accounts--the retirement accounts have tax advantages, the mutual fund accounts give you access to specific investments, this or that bank's savings account pays a higher rate, and so on. The fact remains, though, that it's all your money: <a href="http://www.wisebread.com/the-one-big-lump-theory-of-your-money">your entire portfolio is a single unified pool of assets that supports all of your goals</a>--retirement, buying a boat, paying tuition, your summer vacation, etc.</p> <p>Some people like to have a bunch of sub-accounts where they accumulate money toward specific short-term goals. I understand the inclination, but I suggest that you don't do this. Instead, choose where to save and invest based on the <strong>planned timeframe of the purchase</strong>. Your long-term goals should be supported by long-term investments like stocks and bonds, your medium-term goals with things like intermediate-term bonds, and your short-term goals with savings or short-term CDs. You really only need one savings account to save up the money for all the things you want to buy in the next year or two.</p> <p>It's worth thinking about it correctly right from the start for this reason: While it doesn't make much difference when you're dealing with short-term cash, understanding this is critical for managing your long-term investments, especially the ones in retirement accounts, which is the topic of my next post: <a href="http://www.wisebread.com/optimize-your-ira-and-401k"> Optimize your 401(k)</a>.</p> <p>&nbsp;</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/philip-brewer">Philip Brewer</a> of <a href="http://www.wisebread.com/managing-your-short-term-money">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-9"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-budget-when-you-rely-on-cash-tips">How to Budget When You Rely on Cash Tips</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/when-to-use-savings-to-pay-off-debt">When to Use Savings to Pay Off Debt</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-crash-course-in-offensive-budgeting">A Crash Course in Offensive Budgeting</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-out-of-debt-first-then-focus-on-saving">Get Out of Debt First, Then Focus on Saving</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-step-by-step-guide-to-creating-your-emergency-fund">A Step-by-Step Guide to Creating Your Emergency Fund</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Budgeting cash emergency emergency fund goals liquidity money money market money market funds savings savings account Tue, 28 Jul 2009 12:00:08 +0000 Philip Brewer 3429 at http://www.wisebread.com