I once went on a date with a friend of a friend. Before appetizers, he asked what I did. I told him I was a personal finance writer, and he told me he didn’t believe in all that “hooey.” In fact – I kid you not — he said he kept his money hidden in his kitchen.
We didn’t have a second date.
When it comes to saving money, not every way is the right way. And keeping large amounts of cash stashed around your house isn’t the only wrong way to save. Here are a few other indicators you’re doing it wrong.
At least once every two years, compare the rates and deals at several banks to make sure you’re earning the most on your savings, or at least paying the least possible amount in fees. If you’re not, give your bank a chance to compete. If they’re not interested, switch. Check out our interest rate search to look for better rates.
And while you’re at it, make a day of it: Compare prices on auto insurance, cellphone plans, Internet service and anything else you’re paying for. If you’re not getting the best deal, switch or call your current provider and ask them to meet the rate. You might be pleasantly surprised.
Current rate on brick-and-mortar savings accounts:
Current rate for online savings accounts:
Moving your savings to an online bank is simple: In most cases you can link your new online account to your checking account for same-day transfers.
If you’re not keeping track of your spending, start. Free services like those offered by our partner, PowerWallet, will do most of the work for you. You might be surprised about what you learn and how much you can put aside simply by seeing what you’re doing now.
Resist the urge to shop sales. Instead, decide what you really need, then wait for it to go on sale.
Instead, set aside some of your savings for fun stuff – a dream vacation, a huge flat-screen TV, the new PlayStation 4 – whatever you find exciting. You earned your money, so you should get to spend (some of) it on what you want.
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