Banking Tips to Improve Your Personal Finances

Written by  //  2016/05/03  //  Student Living  //  Comments Off on Banking Tips to Improve Your Personal Finances

Your personal finances are enhanced by your banking choices. Here are a few tips to ensure that you get the most out of your banking.

Choose the Best Holding Patterns

If you are only considering savings and checking accounts to hold your expendable income, you are missing out on the true advantage of holding money in a bank. On top of this, the interest rates that banks offer for these basic accounts do not outpace inflation in many cases, meaning that you are actually losing money by holding cash there. Although it is not quite as bad as keeping money in the mattress, it is not much better.

Take a look at some of the other products that your bank offers including long term CDs, money market accounts, annuities, and jumbo products. These products usually have a higher interest rates with little downside, meaning that your money works harder for you.

Create a Timeline for Yourself

As an addendum to the above tip, you should create a timeline for your finances so you know which of your monies are truly expendable and which are not. If you can determine the money you put into long term accounts, you can make that money work harder for you. Sit down with your banker or Financial Guidance Center and determine a timeline for your income streams that will help to solidify which of these streams you can place into the accounts mentioned above.

If you do not perform this step, you risk placing money into accounts that you will need back quickly. If you do this, you risk taking on early withdrawal fees and other penalties from the Internal Revenue Service that can completely destroy any profit that you would have made in the investment.

Try an Online Bank

Many online banks have better interest rates and more advantageous terms than brick and mortar banks. Some banks with online outlets and brick and mortar storefronts will actually offer better terms on their online platforms. It costs much less money to take money online and there are no real estate overhead costs online. There are less employees required to maintain the website than the actual storefront and the bank is happy to pass along these savings in the form of higher interest rates and less restrictive accounts. You also gain more access to your money overall, because you can get to it from your smartphone or your tablet.

There are many new opportunities for your finances if you just take the time to look. Give the above tips a whirl, and ask your banker for the best new technologies that are geared to help you make money!

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