Febraury 23, 2016
By Michael Fina, Radius Bank, Union Relationship Manager
(FDIC Consumer News)
Finding money to put into savings can seem difficult, but there are some strategies that can make it easier. Start by asking yourself these questions.
Do I have savings goals? Knowing how much you want to save and why can help you stick to a plan. For example, if you have a young child, ask yourself if you plan to help pay for college. Research indicates that children who have a college savings fund are more likely to go to college than those who don't. There are a number of programs available to help save specifically for college-related expenses.
How can I spend less? Review how much you spent in the last month and consider ways to cut back. "Start by reviewing recurring expenses — even small ones — and determine what you might be able to cut out, downgrade, or find a better deal on elsewhere," said Luke W. Reynolds, Chief of the FDIC's Outreach and Program Development Section.
Also try to pay less in interest. For example, if you have multiple loans, pay off the ones with the highest interest rates first. And, regularly reviewing your credit report and correcting errors can result in considerable savings on loans and insurance policies.
Do I have an emergency savings fund? Financial experts generally recommend that you have at least six months of living expenses in a federally insured product, such as a savings account or a certificate of deposit (CD). The idea is to help you withstand a major reduction in income, such as from a job loss, or to pay for a major, unexpected home or car repair. To build your "rainy day fund," consider a combination of regular, automated deposits and any "windfalls" you receive, perhaps from a tax refund or a bonus at work.
Furthermore, be sure your money is in the right account that is earning a competitive interest rate. Many banks have High-Yield Savings products that may earn 1.00% APY or above.
Am I saving money on a regular basis? "Automatic transfers into savings on a set schedule can help you save money before you spend it," said Bobbie Gray, an FDIC Supervisory Community Affairs Specialist.
Am I saving enough for retirement? For many, the answer is "no" even when they think it is "yes." Options to save include workplace retirement plans, Individual Retirement Accounts (IRAs) offered by many banks and investment companies.
Radius Bank is committed to providing union organizations and members with services and resources that help protect and grow their money. To learn more about Radius Bank or its products and services, visit radiusbank.com or contact Michael Fina, Vice President/Institutional Banking Relationship Manager for Radius Bank.
Michael Fina, Vice President / Institutional Banking Relationship Manager mfina@radiusbank.com www.radiusbank.com
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