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A Penny Saved, Part III Comments

  • By Claire Poole
  • May 12, 2009

What you don't see, you won't spend. SaveThat's the idea behind an automated withdrawal system, which takes money out of your checking account every month and puts it into a savings account. You can create multiple savings accounts, one for a 6-month emergency fund, and one for a down payment on your first sailboat (ok, maybe not a sailboat, but you get the idea). You could time it when you get your paycheck - and then register the adjusted amount. Start with 2%, and if it doesn't crimp your style, move up from there.

There are some high earning savings accounts out there - ING Direct, for example, boasts a 1.5% annual percentage yield for its savings account versus 0.69% for a money market fund and 0.42% for a bank savings account. We love this the most: you can change the withdrawal amount and make transfers anytime via the Internet if you find yourself in a pinch. http://home.ingdirect.com/products/products.asp?s=OrangeSavingsAccount

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