Choosing the Right Savings Account for Your Goals
Saving money in uncertain economic times is necessary for the future, but a difficult task for many American families. Adding to the everyday stress of finances, there are many different savings accounts to choose from. If you don’t establish financial goals, it can be a very overwhelming decision. We offer suggestions for the best savings accounts based on short and long-term savings goals.
When saving for the short-term, money should be in easily accessible account. Whether you’re trying to build a nest egg or save up for a new car, your goal will be met relatively quickly if you’re serious about saving. Rather than getting wrapped up in the red tape of an account that you can’t touch for many years to come, consider a money market fund or short-term CD.
An emergency or rainy day fund is typically three to six months of living expenses. In the event that you lose your job or have a medical crisis, this money is designated to help you through. If you want to expedite the savings process, consider a money market account. These competitive, high-interest funds are the best of both checking and savings accounts.
Weddings can take several years to plan, but are generally not considered a long-term savings goal. Depending on the amount of money you need and how soon you have to pay vendors, a money market account or CD can help you meet your goals. As mentioned above, a money market account earns a high rate of interest and, through Ion Bank, has unlimited in-branch withdrawals. A CD also comes with a high interest rate in exchange for the time you leave the money untouched. We offer three to 60 months at a fixed interest rate.
Car or Mortgage Payments
To help pay the initial down payment on a car or home, consider a money market, CD or a standard savings account. Although standard accounts earn a small rate of interest, you can easily make withdrawals and transfers while saving at your own pace.
At Ion Bank, we have a specific savings account for vacation planning. Our Club Accounts are a safe place for you to keep the money needed for a trip until the time to travel comes. You continue to make contributions whenever you can until right before your vacation, when we’ll send you a check for the amount accrued!
Many people associate “long-term savings goals” with retirement. While that is an extremely important lifestyle change to prepare for, saving for college is equally as important to parents. In these two instances, you don’t want a liquid account.
If you don’t have a retirement fund set up through your employer, Individual Retirement Accounts (IRAs) allow you to make tax-deferred contributions until the time of withdrawal. You can continue investing money into this account for your future retirement plans until the age of 70 ½. Traditional IRAs through Ion Bank are available as three to 60-month CDs.
As college tuition costs continue to rise, the earlier you start saving for your child’s education, the better. The Coverdell Education Savings Account is a great option to invest tax-free dollars up to $2,000 a year. Other family members and friends can contribute to the account as well, so any cash gifts your child receives can be put towards college savings.
To explore all of your savings options, visit an Ion Bank location today.
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