Does it ever feel like you’re treading water financially? Getting ahead of the game—saving—can be difficult. With some helpful information on how to save properly and the different avenues for saving, you’ll be on the right track to making “saving money” an attainable goal.
Personal Savings Accounts & Certificates of Deposits (CDs)
To determine whether a personal savings account or a certificate of deposit is right for you, keep time horizons in mind. Interest rates are lower with savings accounts, but you can take money out and put money in more liberally. CDs, however, can be opened for terms varying in length from three months to five years. Typically, the longer you invest your money, the higher the interest rate. Therefore, if you keep your money in a CD for a prolonged length of time for your savings goal, you’ll reap a larger amount of money saved in the end.
Health Savings Accounts (HSAs)
If you’re participating in a high-deductible health insurance plan through your employer, you might want to consider opening a health savings account. With a health savings account, you can save for your future health care costs and take greater control of how you are paying for medical expenses. Typically, high-deductable health plans offer lower premiums compared to traditional medical insurance plans. The money you are saving on premiums can be invested in your HSA.
Individual Retirement Accounts (IRAs)
You might be participating in a 401k account through your employer, but you could be saving additional money for retirement by opening a Traditional or Roth IRA. By speaking with a banker, you can go over your current 401k options through your employer, make sure you’re utilizing it properly (percents/matches/breakdowns), and consider if a Traditional or Roth IRA might be another option for you to save for your future.
The life stage you are currently in will help you establish the best savings plans for you as well. Whether you’re single, married, married with children, or looking to retire, your financial situation is unique. The best strategy for savings and investment goals will vary, so feel free to speak with a banker personally at any of our eight locations.
Bank of Luxemburg Chief Operating Officer Rebecca Edler provides tips for saving on Fox 11's Living with Amy.