There are many reasons to save money but not enough of us actually do it. When you contribute to your savings plan, the money may be used to make a down payment on a large purchase such as a home or car, pay for educational expenses, save for retirement, or cover emergency expenses. In the unfortunate case of layoff or death of a spouse, savings may be used to cover monthly expenses until those affected get back on their feet.
Conduct a bit of online research in order to find the correct savings plans. Savings accounts pay interest on deposits and money market accounts usually pay an even higher rate of interest than traditional savings accounts. Some banks feature holiday club accounts that allow members to put away cash throughout the year in order to save for gifts and other holiday expenses. In addition, look for banks and credit cards that feature cash-back options on some of their most popular accounts.
Certificates of deposit allow the saver to deposit a certain amount of money for a specified period. During that period, a designated interest rate will be “locked in,” providing a safe way to save and earn money at the same time. Consider a Section 529 educational savings plan in order to save for family higher education expenses. Invest in retirement savings accounts such as 401k plans and individual retirement accounts. These provide avenues for saving and earning and they also feature tax benefits, but do carry some investment risks.
Clip coupons for needed items and redeem them at stores that offer double coupon savings. Some grocery stores provide discounts to shoppers who use recycled shopping bags. Check shopping circulars and do an online search to find the best prices on necessary products. When buying online, shop with companies that offer free shipping and discounted prices.
It is important for every household, no matter how small, to develop both a budget and a savings plan. Putting away extra money for necessary expenses or for the golden years is a wise step to take. Every household will rest assured that the money will be there when the need arises.