2019 is in full gear, and one way to start the new year off right is by making the right financial goals. Whether you want to save money for a big boxing week purchase, your retirement, education, or anything in between, there are certain things you should take into consideration. You may also find yourself a bit confused about where to start, what type of savings account you should open, and what your various options are. If one of your goals this year is to save money, here are some tips to get you on the right track.
Follow the 24 Hour Rule
The 24 hour rule helps people avoid making impulse purchases. The rule states that when someone is considering making a purchase that isn’t essential, they should take 24 hours to think about it. So if you’re considering making a big boxing week purchase this year, take 24 hours to think about it before making the actual purchase. Whether it be a brand new TV or that expensive winter coat you came across during your holiday shopping, it’s always best to take the time to think about it.
Make a Plan
A plan can go a long way. It gives people something to work towards and steps to achieve it. A plan can also keep people accountable as they work to reach their financial goals. Whether it be a savings plan with your bank or steps you plan on taking to accomplish your financial goals, having a plan will help you gain that extra confidence you need to reach financial success. You can also consult with one of our mortgage agents on how to tackle debt and lower interest payments. This can be incorporated into part of any savings plan.
Save for Retirement
Many people fail to understand the importance of saving for retirement at an early age. It is crucial to start saving for retirement as early as possible, even for young professionals who are just starting out their careers. Take advantage of workplace retirement plans or speak to a bank about retirement options. We also offer reverse mortgages, which are a great solution for seniors who didn’t save for retirement. Reverse mortgages allow homeowners to use the equity built in their homes in the event that they need additional cash.
Start an Emergency Fund
An emergency fund has money that is set aside to cover families in the event that someone loses their job, becomes ill or injured, or experiences any other life surprises. The money in emergency funds is not used for any type of planned purchase but is rather set aside in the event that an emergency occurs. This allows a family to be covered financially for a certain period of time while they deal with their crisis.
Set up Automatic Savings
This is an easy way to ensure that someone doesn’t forget to save money. An automatic savings plan can be set up with a bank so that a certain amount of money from a checking account is transferred to a savings account on an agreed upon date each month or week.
What Type of Savings Account Should I Open?
The type of savings account someone opens depends on their goals, what they are saving for, how much they plan on saving, and how long they plan on saving for.
Basic Savings Account
A basic savings account is an account people can freely deposit into and withdraw money from. Some basic savings accounts have limits on how much can be withdrawn. A basic savings account is a good fit for savings needs that are simple, but there are other types of savings accounts that might be a better fit for more complicated finances.
Money Market Savings Account
These types of savings accounts have higher rates than regular savings accounts and usually require a minimum balance to avoid any monthly fees. Money market accounts are usually limited on the number of withdrawals and are Federal Deposit Insurance Corporation (FDIC) insured.
Certificate of Deposit
A CD usually has a fixed interest rate and maturity, and also typically has the highest interest rate among the three main types of savings accounts. A CD has limited access to funds, if any at all. This is because there is typically an agreement not to withdraw any money for a specific period of time. If money is taken out during that period, an early withdrawal fee is charged.
Contact us Today
If you need help getting your expenses back on track, contact us today. We offer easy and fast services to homeowners in the GTA. If you are a homeowner, you may be able to qualify for a loan even if you have bad credit and no income. We offer same day approvals, rates as low as 6.99%, reverse mortgages, and more.