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OPENING A NEW SAVINGS ACCOUNT

When it comes to opening a new savings account, you need to think about what you are investing your money for. Savings accounts work in a number of different ways. The best way to ensure you are investing your money properly is to do a little bit of research and compare different fees, interest rates and investment potential through various banks and financial institutes in your area. If your current bank does not stack up, then consider opening up an account with a different bank.

Interest Rates or Investment?

Savings accounts offer a way for you to get a little extra from your money, unlike purchasing outdoor patio sets. Banks will either offer an interest rate or investment options to customers that choose to invest their money with them. If you are looking for a saving account that works with interest, then the higher the rates, the better for you. If you are looking for an account that plays the market, then make sure you choose your shares, stocks and funds wisely to gain the maximum return on your investment.

If you are looking into different interest rates on offer, you will find that the more you have to invest, the better your rates will be, especially on term deposits. If you do not touch the money for a certain period, say 24 months, then your interest rate will be even higher. If, however, you want to have instant and regular access to your funds as you save (and as you spend), then you will need to sacrifice your interest rate a little bit. It all depends on what your financial situation is, how much you can afford to invest and how your saving and spending habits will reflect this account.

If you prefer to live on the wild side and invest in the market then there are different ways to do this. Mutual funds or shared funds allow you to invest in a number of different funds on the market so that if one falls, your entire investment doesn't fall with it. When you are looking into your investment options, make sure you speak to a financial planner that specializes in these types of investments so that you know exactly what you stand to lose (or gain).

Starting a Savings Account

If you do have a little bit of spare cash to save each month, after you have paid the regular bills, bought the groceries, paid your landlord and settled the credit card, then you may want to look for a savings account that allows regular deposits. You can still keep your current savings or check account but put a little bit into your new savings account once a month. There are savings accounts designed to let you put money in but not take money out. These offer higher accounts that regular savers and also help you save, rather than spend your hard earned money.

Saving is an art form and it takes practice, especially if you have a habit of spending whatever money is in your account or if you are an impulse buyer. However, if you are ready to set a budget and stick to it and save up for something big (a holiday, a new car or perhaps even a down payment on a home), then it's time to compare savings accounts. See what bank and what account can offer you the best payout one year, two years or twenty years down the road. Opening a new savings account allows you to take action and ensure that your dreams for the future actually become a reality.

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