Savings accounts might just sound like a standard way to save your money, but you might be surprised to learn that the options available come in many different flavors. When choosing the ideal place to keep your savings safe, it’s important to shop around and make sure you’re getting the best deal available. Everything from fees, to interest rates can vary widely, and there are thousands of different banks and credit unions available to choose from.
In a world of low interest, every little bit helps for those who want to make the most out of their savings account. The money you save could be enough to help you pay for unexpected expenses like car repairs or medical bills, and you may find that by the time you tap into your account, you even have enough to splurge on something special.
The question is, how can you make sure that you choose one of the savings accounts that’s ideal for your needs?
1. Start by Setting a Savings Goal
The first thing to think about if you want to get the most out of savings accounts, is how you’re going to keep yourself motivated to continue holding onto your cash when time gets tough. You can set up automatic transfers to make sure that you’re constantly paying direct debit deposits into savings accounts, but it’s usually helpful to have a goal in mind too if you want to stay focused.
Sit down either by yourself, or with your family, and think about what you’d like to get out of your savings. Once you’ve come to a decision about the goals you’d like to achieve, you can think about how much you need to save to reach the right result, and when you need to start dipping into the money you’ve kept aside.
Sometimes, it’s useful to put a target date on your saving too, as this can mean that you push yourself even harder when you get closer to the time you had in mind. Sometimes, coming up with savings goals could make it easier for you to figure out which savings account is right for your needs. You could even use multiple accounts for different goals.
2. Think About Your Spending Habits
When you’re comparing rates for various savings accounts, it’s important to know your spending habits, and how you’re likely to behave around your money. For instance, some accounts offer a high bonus rate for when you don’t touch your money for long periods of time. However, if you’re convinced that you’re going to need to access your account sooner than these bonuses would allow, then you might need to look for something different.
If you don’t mind shopping around, try to keep looking for the best deals for more than a few days before you decide. Remember, comparison websites are a great starting point for anyone who needs to find a savings account tailored to their needs.
3. Avoid Monthly Fees in Savings Accounts
Ideally, you’ll want savings accounts that can provide you with as many benefits as possible, for minimal expense. The fees on monthly savings account can vary somewhat widely according to the consumer federation, and it’s important to make sure that you don’t end up spending more than you save.
Think carefully about any costs you have to pay to make the most out of your account, as everything you have in your outgoing box will quickly eat away at the value of your interest rate. While there are multiple fees out there to be wary of, one of the most important ones to avoid is the minimum balance penalty.
A minimum balance penalty is when your bank requires you to have a certain amount of money in your savings account at all times, or else you pay a fine. If you don’t have a great deal of money to save, then you’ll need to make sure that you stay away from accounts like this – no matter how tempting they might appear to be at first.
4. Know How to Access Your Money
Remember, you want to be able to access your money when you need it, even if the aim of a savings account is to leave your funds untouched for as long as possible. Being able to access your money through accounts, bank withdrawals, and ATMs is important for any savings account. There’s always a chance that you’ll need to tap into your money for emergency purposes, and the last thing you want is to be left in a sticky situation.
There are some federal regulations that limit the amount of withdrawals you can make from your savings account to six each month. In fact, some banks also allow fewer withdrawals than this, and they may add fees into the mix to prevent you from accessing your money when you’re not supposed to. When you’re looking for savings account, make sure you learn everything there is to know about your bank’s policy on withdrawals.
5. Carefully Search for Competitive Rates
There aren’t a great deal of great interest rates in the market today, which is why it’s so important to make sure that you shop around for the best account available. Online banks are a great place to start your search, as these locations can typically be more generous with their offerings on the basis that they don’t have to pay for things like a physical location.
Remember, when you start shopping around, comparison websites can be useful, but they won’t all necessarily give you the same results, so it’s important to make sure that you look at more than one site before you make your decision. It’s also a good idea to research the kind of product that you think will work best for your circumstances before you make a decision.
6. Try Online Savings Accounts
Finally, many banks are offering a range of online tools designed to help people who have trouble keeping their savings accounts in check. These can be great for people who really want to make the most of their account. Think about checking out the options available from internet banks before you commit yourself to a local branch; you might be surprised at the options available to you.