Savings accounts are among the oldest and most traditional of all bank accounts, and they can help you reach short- and long-term savings goals. When you put your money in a savings account, the bank will typically pay you interest on your funds. One of the most sensible money saving tips you can follow is to put away a certain amount of money each month to build a nice nest egg.
If you are ready to grow your savings, consider these money saving tips that may help you reach your goal.
1. Make regular deposits.
If you use direct deposit to have your paycheck deposited into your checking account, see if your employer will allow you to split the deposit between checking and savings. In most instances, you can designate a fixed amount or percentage of your paycheck for your savings. Once established, the process is automatic. You no longer have to remember to make the transfer and are not tempted to spend the money. At Ally Bank, you can also automatically transfer funds from your checking to savings account.
2. Pay yourself first.
Make savings account deposits a line item in your budget, along with any other money saving tips you use to reduce costs and grow your savings. Treat your savings account deposits just like any other bill that you must pay. The only difference is that you are paying yourself instead of a creditor. On the due date, transfer the money from your checking to your savings account.
3. Use "found money" to increase your savings.
Perhaps you receive an annual bonus from your employer or work overtime occasionally. You may receive cash gifts for your birthday or other holidays. These funds, if not used as part of your normal budget, can help you grow your savings more quickly.
4. As you pay off debt, continue budgeting as if the debt was still in effect, but place the payment amount in savings.
For example, if you pay off your car, put the amount of the car payment in savings each month. If you like, consider this as pre-payment for your next vehicle. When the time comes to replace your current auto, your savings account should be sufficient to make a substantial down payment if not pay for the vehicle completely, which saves you even more money in interest you don't have to pay.
5. Let the money in your savings account rest.
Withdrawing funds without making new deposits means you will earn little or no interest. Try to leave your savings alone if you want to watch your balance grow.
Ally Bank makes banking online easy, and you can earn some of the most competitive interest rates available anywhere, based on the rates published by Bankrate.com. Visit Allybank.com or call live, 24/7 customer service today at 877-247-ALLY (2559).