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Trying to manage your finances effectively when you have a family to support is tough, and if you ever hope to save up any money, you’re going to need a strict budget. Getting the balance right so you can afford everything that you need and still have a bit left over for saving is tough, but if you can manage it, you still need to decide what you’re going to do with your savings. If you just leave that money in the bank, you’ll get a little bit of interest on it but if you really want to improve your financial position, you need to find better ways to hold your savings. These are the best places to put your savings right now.
Pay Off Debts
Before you start thinking about putting your money aside, you should think about any debts that you have. When you owe money, those interest payments are eating into your budget every month and that’s money down the drain. But if you can break free of those debts, you’ll have a lot more money to play with each month which means that it is a lot easier to save. That’s why it might be best to use the extra money that you have to pay off your debts faster, then start looking at better ways to save.
High Interest Savings Accounts
The easiest way to handle your savings is to put them in a high interest savings account. If you shop around and find the best deals, you can watch your money grow over time. But the biggest mistake that people make is sticking it in a savings account and forgetting about it. The deals are always changing and you can often get a better rate by moving your money around regularly. You also need to watch out for inflation because if the rate of inflation is higher than your interest rate, your money is losing value.
A term deposit is a fixed term investment that gives a good interest rate. You deposit the money and you can’t touch it until the term is up. They last from 6 months up to 5 years. If you compare term deposit rates and find the best deals, you can earn a lot of money on your savings. The only problem is, you can’t get at the money so if you are likely to need it for emergencies, this isn’t the best option.
Certificates Of Deposit
A certificate of deposit (CD) is similar to a term deposit because you have to keep the money in there for a certain period. But it is a bit more flexible because you can take it out if you really need it. If you do take the money out early, you will usually get a penalty and lose some of the interest. This is a good option if you don’t want to lock the money away completely just in case of an emergency but you don’t think that you will need it in the near future.
Getting your finances in order and putting some money aside is the first step, but you need to do something with those savings if you want to see your money grow.