You are reading Week 47 of 52 Weeks to Eliminate Debt & Curb Spending. Please read the overview here to learn more about the series & get your FREE financial planner. If you just joined us, please start with week 1.
An easy way to help your over all financial success is to let interest accounts make money for you. While we have spent much of this year talking about how to get rid of debt, this week we are going to talk about one way you can make easy passive income. This income can be rolled back over into your accounts to pay off debt, or simply be a part of your savings plan.
Let Interest Accounts Make Money For You:
Choose an interest earning savings account. One of the easiest ways to earn money on your money is to choose an interest earning savings account. Shop around at your local banks for the best options. Most will have similar or identical interest rates, but it’s always important to shop around. Remember to ask about monthly account fees to make sure you are getting the most for your money. Avoid accounts that charge fees if at all possible.
A Money Market Savings Account at your bank can earn more money than a traditional savings account.
Use credit and debit cards with cash back rewards programs. Not only do credit cards offer cash back rewards, now many of your debit cards do as well. The Paypal Debit Mastercard currently offers a small percentage of cash back earned on purchases made with the card using funds in your account. This is a great way to make money by spending money you normally would be using anyway.
Do NOT charge more than you can pay off per month on credit cards. If you will be tempted to spend more, stick with debit cards and cash only!
Open a CD (Certificate of Deposit) at your bank. A CD is a great way to earn a higher interest rate on your money. The catch is you can’t access your money for an allotted period of time without incurring penalties. This would directly counteract the point of trying to earn money from a CD.
The interest rate will vary depending on the length of time you choose from the CD. Typically, three and six months, one, two, five or more years. IF you have a fully funded emergency fund and have enough money to tie up for a specific amount of time, then this is a good option for you. Remember, you don’t want to withdraw the money before the term expires! If you don’t have enough money in savings to cover an emergency or you are still trying to get your debt and spending under control, stick with the traditional accounts for now.
Invest in 401K or Roth IRA programs through your employer. This is a wonderful way to easily invest your money with little effort. If your employer offers a retirement program through a 401k or Roth IRA take advantage of their offer to match your investments. This retirement savings offers great interest or money making stock options that increase your savings with little to no effort on your part.
No matter what type of account you choose, let interest accounts make money for you this year. As you continue working to pay off your debt these small efforts may not seem worth it but can easily add up over the course of time to create an excellent savings for you.
Week 47 Challenge:
Start researching savings plans at your local banks. Make an appointment and open an account. Start depositing money into your new savings account on a regular basis to fund your emergency fund.
Disclosure: I am not a financial adviser nor do I have formal financial training. All articles are for informational purposes only and should not be interpreted as financial advice or consultation. Please consult your account and/or financial adviser before making changes to your finances. All situations are different, so please consult a professional to determine your individual needs.