Savings account: a bank account on which interest is paid
Have a financial goal? Want to avoid living paycheck to paycheck? Learning the art of saving can help you reach your financial goals. Whether it's moving out on your own, planning for retirement, or even simply planning for a vacation, learning to save money will prevent you from taking on more consumer debt than needed. Find out tips on setting up a great spending plan and remember to always pay yourself first.
Types of savings accounts
Basic bank savings accounts offer the lowest interest rates, usually 2%. They have few restrictions on access to your money, and they tend not to require minimum balances.
High yield savings accounts are like basic accounts, but they have more restrictions on how often withdrawals can be made and typically require a minimum balance. These accounts may offer 3-4% interest.
Money market accounts are like high-yield accounts, but they are tied to federal market indicators such as the prime interest rate.
Online savings accounts are like basic bank accounts, but they offer higher interest rates because they operate online and don't have the overhead that standard brick-and-mortar banks have.
Credit Union accounts offered by Credit Unions tend to offer higher interest on their savings accounts.
As a new college graduate, planning for retirement is likely the last thing on your mind. Although it can be difficult to think about your needs and wants years from now, now is the time to start thinking about your retirement. That's right: not in 10 years, right now! The earlier you start investing in a retirement account, the more money you'll have to sustain you once you retire. There are many different types of retirement accounts (IRAs, Roth IRAs, 401Ks) For more information on retirement accounts visit the IRS website and find which is best for you.