Savings rewards are scarce now a days. Have you noticed that savings accounts only pay .01 to .10 cent interest on thousands of dollars in regular savings accounts? How can you make a $1.00 from 1 cent?
The savings crunch is not just for retired individuals, or people who lost their job, banks and credit unions have scarce savings to reward their customers.
While saving money is not a scientific skill, using the strategies of others could tremendously increase your ability to save money. These are the strategies that have worked best for me.
- Create a savings habit: Learn how to save.
- Develop a savings goal, plan and strategy.
- Update and renew your savings goals and plan.
- Compare scarce savings rewards for the best rate.
- Use all of the “Perks” to make $1.00 from 1-cent
- Make a transition to-do list to ensure that everything is completed
Affiliate Marketing Disclaimer: This article contains Amazon affiliate links. Financial Disclaimer: This article contains strategies that I use personally, but should not be taken as a prescribed method of use for you.
Saving is most rewarding when you turn one-cents into one-dollar.
Professionals advise us to start saving money early in life, however the ability to save a lot may not be or have been possible for some individuals.
A lot of economic problems were born out of Covid-19. This one economic problem created scarce savings rewards that changed interest levels from making a $1.00 to now just 1-cent. In the money crunch we have seen in 2020 and 2021, saving money can be a bit tricky.
Nonetheless, I believe a lot can come from this economic downturn. I believe that teaching our grandchildren to save even when times are hard is a monumental lesson.
1. Create a Savings Habit
Saving money throughout your life increases your chances to reach millionaire status. Also, savings rewards are scarce in today’s economy. Therefore, the earlier you start saving money, the better. Some professionals teach that saving money is important in the 20s, crucial in your 30s, and critical in the 40s and beyond for retirement.
However, I believe that learning how to save and saving money should start as early as 8 or 9 years of age. I am sure that a 8 or 9 year old is not thinking about retirement, but they certainly understand what being a millionaire is all about and saving toward millionaire status is a great motivator. Even more important, teaching children to save helps to protect them from a life of debt.
Additionally, teaching or learning how to save also teaches us to:
- determine our needs from wants
- develop and practice patience and discipline with money
- learn the importance of sacrifice
- monitor our spending and progress toward a goal
- stay focused on a goal and not give up
2. Develop a Savings Goal, Plan and Strategy
Develop a saving goal, plan, and strategy that you can accomplish without struggling and grow from there.
How do you start the process?
No matter what your age, long-term saving is done best with a goal. Therefore, you must develop a goal for saving and stick to your plan. If you are not sure how to start, check out some of the savings challenges that other individuals have used to save money. Using a savings challenge strategy should give you a start date and a specific amount to reach for your goal.
Also, some savings challenges tell you specifically how much to save each week to reach your desired goal. After you determine that, decide how you will follow the challenge and save the money. Nonetheless, if you are using a savings challenge and you have kept the money at home, you should investigate and determine the best type of savings account for your cash to get the most interest possible.
I suggest repeating this strategy three or four times but increase the amount you save so that you have more money to place in your long-term savings account.
3. Update and Renew Your Savings Goals and Plan
Now that you understand how to save money, rewrite your savings goals and your plan. When you refigure your plan, determine how you will continue to increase interest when rewards are scarce. Also, I suggest that you add a rainy day goal into your savings strategy and increase the plan to cover a full year. Additionally, once you complete the first year without any setbacks continue with the strategy for life.
Are you ready to move your money into a bank account and take advantage of the perks and earn additional interest?
If yes, make sure you compare banks to credit unions. You may capitalize from having accounts in both. Nevertheless, thoroughly researching and comparing both the banks and credit unions before you open your new account will give you the greatest saving power.
4. Compare Scarce Savings Rewards For the Best Rate
Once again, the rewards that come from savings interest is scarce. Therefore, comparing savings and checking and banks and credit union accounts can be a bit tricky. I suggest that you keep it as simple as possible. In making your comparison, compare savings accounts rates to savings account rates.
You may also want to investigate online savings accounts and determine how much they offer in interest rewards. Our online savings account article explains some of the benefits of online savings accounts.
Likewise, compare checking account rates to checking account rates between banks and credit unions. I have found that using a checking accounts at credit unions provides a better interest rate than checking accounts at banks. Therefore, I use a checking account at a credit union. Additionally, I use high yield savings accounts for at either a bank or credit union depending on which offers the best interest rate.
Comparisons should also include fees. When you are making your comparison be sure to include any fees that come from the bank or credit union. For example, what is the fee for using the ATM card? How much of the ATM card fees are reimbursed? You also want to know the account minimum balance and any withdrawal penalties.
When you investigate the withdrawal penalties find out how much and how long the penalties cover. For example, I had to take an early withdrawal from a high yield account that I had set up for a five year period. I was about 2 1/2 years into the contract, when I had to close the account. I had heard horror stories of people losing almost all of their money from early withdrawals.
I was afraid that they would take half of my money, but I had no choice.
It turned out that I only lost the interest, not the money that I deposited, and only the portion paid for that physical year. Therefore, find out how the penalty works before you start the contact.
5. Use all the "perks" to make a $1.00 from 1-cent
How can you turn the scarce savings rewards into an extra dollar? Take what they give you and follow the outline of the contract completely.
You can easily make a make a $1.00 into $1000.00 by opening a Chase Sapphire Checking or savings account. The account requires a minimum deposit of $75k within 45 days of opening the account to qualify for the $1000.00 bonus. You can also add an additional $25.00 to the money with the $25.00 monthly fee wavier.
If you do not have the extra $75k, Chase has another offer that might interest you with their savings account. Chase offers a $150.00 for opening a savings accounts and holding the balance of the account for a minimum of 90 days.
In addition to the above offers, Bank of America, HBSC, SunTrust and Wells Fargo also have similar offers for opening a checking or saving account. Theses offers are a easy way to turn the scarce one-cent savings rewards into more than a dollar.
6. Reward Yourself: Make a Transition to-do List
When you get ready to make a move make a to-do list so that you don’t miss something important. These are a few things that you can do to make the transition easier and more complete in one swift move.
- A New Checking Account: Start your move with the checking account. According to Regulation D, withdrawals to savings accounts are limited, therefore a checking account is required. Additionally, savings accounts are usually attached to a checking account, and an ATM card. If you plan on writing checks, order the checks, and review all the account information to ensure that everything is written correctly.
- Split Deposits: Divide your savings and checking deposits for that month if necessary to ensure that the money is in the checking account before the automatic withdrawals start.
- Tie Up Loose Ends: When you make the move to the new checking account make sure you have a list or a printout of the automatic withdrawals, prior deposits and a copy of your statements from the past 3 to 4 months. Also, make sure that the automatic withdrawals start coming out of the new account before you close the old account.
- Cut Ties To Old Account: Once your automatic withdrawals come out of the new account, and all of the outstanding checks clear, you should be in the clear. If you still have outstanding checks after a month or two, you may want to contact the facility about the outstanding check(s).
Close the account: If you follow this process it will take about 90 days to close your accounts. But, there should not be any loose ends or future problems from the establishment.
Conclusion
We started by discussing the scarce savings rewards available to individuals. We also mentioned that banks and credit unions are also suffering from the scarcity. Also, because they are suffering they do not have any rewards to pass on to their customers.
We also mentioned that professionals advise us start saving money early in life, and continue throughout our lives. We continued with developing a savings goal, plan and strategy that is easy and doable. We reiterated that rewards to savings is scarce, so do your due-diligence and determine which plan works best for you.
Also we gave a few examples of items to compare while you shop around for the best savings rates. We moved forward into discussing the “perks” offered by some banks. Finally, we ended with creating a transition to-do list so that you can make sure you cover every aspect of the bank account move.
Resources
- How to Earn Money With A Bank Account Bonus https://www.thesimpledollar.com/banking/how-to-earn-free-money-with-a-bank-bonus/
- How to Save Money Throughout Your Life
- https://www.interest.com/savings/how-to-save-money/
- How to Switch to A New Checking Account https://www.thesimpledollar.com/banking/checking/how-to-switch-to-a-new-checking-account/
- The Best High-Yield Savings Accounts for 2021 https://www.thesimpledollar.com/banking/savings/best-high-interest-savings-accounts/
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Excellent wisdom and tips. Loved make a plan and continue to tweak it
Hello, Sandra. I have been searching for a good plan, where I do not have to move too much money. The best interest rate I found is at a CU in Maine, the problem is the 6.17% is only up to the first $1000.00.
I decided to use these high interest savings like a safe investment account.
Thanks for responding,
Sharon
This information was very informative. Especially use all the perks section and the Tie up loose ends section.
GA Monique, thank you for checking out my post. I fixed a few type-o and some things that did not save on my original corrections. Please feel free to share this and any other article.
Sharon
Thank you for this information Sharon it is good.