Savings Accounts

 Unexpected expenses  Opportunities  Major Purchases  Flexibility  Achieve Long Term Goals

 Save First  Just like paying a bill put money from your checking account into a savings account.  Same amount each pay period or a certain percent  Automatic Payment to Savings  Like direct deposit a portion of your paycheck goes straight into savings

 Custodial Savings – Savings account for a minor  Can have savings account until child is 18 years old  Child can make deposits, but parent have to make the withdrawals  The parent is also on the account with the child  Usually no minimum or very little minimum balance (ex. $5 - $10)  Earns interest

 Statement Savings – A regular savings account that you receive a statement at the end of each quarter. (unless you have a checking account, then usually on a monthly statement)  Can usually be opened without a parent if under 18 years old  Usually has a minimum balance to avoid a fee (ex. $100 minimum)  Earns the interest on monthly basis  You are responsible for balancing account register with the statement  Can get an ATM card with this type of savings – usually have to be 18 years old to have card (it’s not a debit card, can only be used at ATM for withdrawals & deposits)  Most common type of savings account

 Money Market – A savings account that has check writing privileges  Usually has a minimum balance to avoid a fee and earn interest (ex. $ $5000 minimum)  The interest may vary depending on the balance of the account, usually a tiered system  Usually allowed an ATM card  Receive a monthly statement, you’re responsible to balance checkbook  Allowed to write six checks a month (if you exceed 6, there is a fee – this is a government regulation)  Can make unlimited deposits or withdrawals with a bank teller  If account overdrawn, there is usually a fee (ex. $35 - $40 fee)

 Banks look at savings accounts as short term investments (give low interest rates)  CD’s - Certificate of Deposit  Minimum balance  Better interest rates  Most have a minimum amount of time you must keep your money in  Penalty if you withdraw your money early

Very Liquid Savings Account CD Stocks and Bonds Car House/ Property Not Liquid