How to Make Your Money Match Your Life

Your dreams matter. Make them attainable by investing your money in the most profitable way. Whether you’re planning a dream trip, looking to purchase that perfect home, or schedule for your years of retirement, organizing your financial life will make a meaningful difference.

Set your dreams in motion by learning more about saving your hard-earned cash:

1. Savings Account

You may be thinking, a savings account? YAWN! But, did you know a savings account is a perfect hideaway for your short-term or long-term goals? You could stash your money away to save it for a vacation, that new car, or to make sure you’re prepared for any curve ball life may throw.

One of the perks of a savings account is the interest it earns. This interest rate will vary based on the type of savings account you choose and your total balance, but you will still get to watch your money grow while you sit back and twiddle your thumbs.

Another important feature of a savings account is the sense of security it can give you. A savings account can be linked to your checking account to cover overdrafts (we are only human, having a backup plan is just smart thinking). An overdraft is when you spend more money than you have in your checking account. When this happens, funds from your savings account automatically transfer to cover the deficit, saving you from overdraft fees.

The best part of a savings account? You can take the money out whenever you want. Whether through an ATM or by transferring it into your checking account with mobile banking, it can be done in seconds. The money is yours, so it is open to your every need.

2. Certificate of Deposit (CD)

Fun fact, CD’s aren’t just for old people or your outdated CD player! A certificate of deposit is the ultimate way to earn a higher rate of return on your savings.  A CD is an account that sits for a set ‘term’, or an amount of time. These terms can range from 6 months to 36 months. When you put your money into a CD, it is meant to sit in it until the term is up. So, to sum it up for the guy in the back, a CD could make your money grow faster.

Some CDs have a fixed interest rate that will remain the same for the entire term, while others have a variable interest rate that can fluctuate depending on the current interest rate climate. A good idea is to keep an eye out for when your bank is having CD specials or to ask your personal banker what their rates are right now.

Another great thing about CDs is their flexibility to match your life, it should be known that they live to please you. There are a variety of terms, so don’t be afraid to dig for one that fits your savings needs.

The only hiccup with a CD is, even though you can withdraw your money before it matures (hits the term limit), you may have to pay an early withdrawal fee. So relying on a CD for your impulsive purchases, may not be a great idea.

3. Individual Retirement Account (IRA)

Last, but far from least, we have the individual retirement account (IRA). If you are like a majority of Americans, saving for retirement sounds complicated and confusing. So, let us break it down.

As of the 2018 tax year, you can save $5,500 in an IRA each year ($6,500 if you are 50 years of age or better). A traditional IRA is also a GREAT savings alternative! It can offer additional tax breaks and some IRAs, such as a Roth IRA, can really diversify the tax treatment of your retirement savings.

Also, did you know that there are ways to take money out of your retirement account WITHOUT receiving any penalties? Pretty sneaking, right?

Things that your retirement account can help cover, other than your actual retirement:

  • Purchasing your first home (up to $10,000)
  • Covering medical expenses that exceed 10 percent of your adjusted gross income
  • Paying your college tuition or college expenses for your spouse, children, or grandchildren

Now that you know how to set yourself up for success, start putting your new knowledge into actions. If you need financial guidance or are ready to get on your way with setting up a new savings account, contact Unison Bank. Our experienced bankers are excited to meet you and learn more about your goals!