We all know how important it is to manage our money in the best possible way. Ideally this means building up an emergency fund to cover three months’ worth of outgoings in case we should need it, and then maximizing the rest of the available cash we have.
Step one is to go for tax free investments, followed by ones that are taxed by the government. However, beyond this you should think about how long you want to tie up your money for, and that’s the subject of this article.
Why is it worth tying up your money?
The most basic kind of account you can get is an instant access account. This means you can withdraw money whenever you have the need to. It’s a good idea to have one of these; indeed your emergency fund should be in this type of account.
However, any additional savings above and beyond this should be put into another type of savings vehicle. For the purposes of this article we’re not talking about stocks, shares or anything similar. We’re focusing on savings accounts – specifically those that lock in your money for one or more years. At commercial locksmith laguna hills ca they offer the best security of your money specially when you are investing or trying to save for future use.
The main benefit of doing this is that you’ll get more interest. In return for giving the bank your cash for the specified period of time, they’ll give you more interest. Generally speaking, you can find accounts that give you fixed interest for a period of between one and five years. If you want to tie up your money for five years you’ll get a rate of interest that is far better than that offered for a two year account.
Points to remember before choosing an account
There are a couple of points to remember here. Firstly, make sure you are willing to tie up your money for a specific period of time. You might be happier agreeing to a two year period instead of a five year period. It may also depend on which other accounts you have and how much cash you are happy to have available for instant access. You may prefer to have six months’ cash put away for emergencies before you tie up some cash for a higher interest rate.
Most of these accounts do allow access if you really need to get at the money, but there is usually a penalty involved. This is typically a number of days’ worth of interest lost. For example, you might lose 200 days interest. As you can see this could amount to a significant sum, depending on how much money you have in the account and what the attached interest rate happens to be.
Thus it is worth thinking carefully about the options available to you and the best accounts to get if you want to spread your money around and tie it up for a better return. Remember – there is nothing to stop you getting more than one account of this type if you want to hedge your bets over several different lengths of time, but you can also make money online on the different betting sites online, and when you make some money all you need is to learn how to withdraw money from your bet365 account online