I am not a Financial Manager/Advisor nor do I play one on television.
Over the past year I have been working very hard on managing debt, saving money, living on an allowance and opening an IRA. Several people have asked me about my online savings accounts, my IRA that I got this year, and how I work with my budget. My brother has helped alot with planning my budget and debt. I call him my financial manager. Good thing he doesn’t charge me, I would be broke.
Over the next couple of Mondays, I will be sharing some of my knowledge and what has been working for me to become a more financially healthy person.
Five years ago I opened an ING savings account online. This is a wonderful way to save money with the purpose of “out of sight, out of mind” type account. You can easily open an ING Direct account if you have a checking account at a regular brick & mortar bank. www.ingdirect.com You can even earn money by referring your friends. You will get $10 and your friend gets $25. How awesome is that deal? The current interest rate is 3.00% If you need to get money out of your account, it takes 3 business days. That really isn’t that bad. I have never had an issue with getting money out of the account.
Earlier this year I opened a second online savings account at Washington Mutual (WAMU). They offer an online rate right now at 3.75% with a free checking account as well. You have to get the checking account in order to get the online savings account. I will admit that this account was not as user friendly to set up because of my recent move etc. I have gotten that fixed though. You can sign up for an account at www.wamu.com This account is used for my major savings account. I put money in it monthly to cover 3 months worth of all my bills and expenses. This is incase I lose my job. So far I haven’t had to use something like this, but it is a stress relief having it.
I also have a 3rd savings account. You can never have too many :) This one is through my bank, Wachovia. It is called way2save. The monthly interest is 5% and they match it at the end of the first year with 5%. You can only deposit $100 monthly. So how do you make money on this one? You use your Visa checkcard, pay bills online and write checks. Everytime you use your checks or bankcard it transfers a $1 to the way2save account. I use the Wachovia checking account for my “monthly” allowance and spending. It has a visa checkcard too. I do an auto transfer on the 1st of the money into this account so that I am ready to spend for the month. Once the money is gone, I am done spending. If I have the money leftover, wonderful for next month. I have an extra $100 bucks in there to cover the $1 transfers for the way2save program. It works. This money in this savings account will most likely be my spending money for the following year trips etc.
I have found that by paying “myself” first before my bills help me work within my budget monthly. It assures me that I don’t dip into my bill money. This is also enforced by having the checking account at Wachovia for my spending habits and not my bill paying.
If you have any further questions about online savings account, I would be happy to address them. Good luck on your savings adventure.
****if you email me I can send you the link to earn $25 free (with $250 deposit) in ING. I will get $10 and you get $25 for signing up through the link and your $250 deposit. Just post your email or send it to me ( your email addy will not be sold). **** nannyadventures at gmail dot com
3 responses so far ↓
1 Savings Toolbox // Aug 18, 2008 at 3:16 pm
One thing to be aware of, is that banks who change their rate to jump to the top of the interest rate ladder are just trying to get new money and will lower their rates in the near future. It’s a better idea to get an online savings account at a bank which has consistently stayed with high interest rates.
2 Thomas // Aug 19, 2008 at 1:36 pm
online savings accounts are a great way to “hide” money from yourself. Automatic deposits are the way to go, and the 3-5 day delay in getting funds helps to insure you don’t spend it on junk.
3 nannypwr // Aug 19, 2008 at 4:16 pm
Savings Toolbox: That is a great point and the best hands off approach. Before interest rates dropped, changing banks was well worth the additional time of setting a new account.
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