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Saving on a Tight Budget

Written by Super User · 09 May 2012

How can those who currently aren’t saving afford to save money? And how can those saving only a little save more?

Here are our top 10 tips for saving money when budgets are tight.

Cut Spending Painlessly

Tip 1: To find small savings that add up to big savings over time, keep a careful record of all (and we mean all) of your expenditures for a month. You may be surprised to learn how much you are spending on such things as a daily latte or restaurant meals.

Tip 2: For necessary purchases — such as food and transportation and insurance— comparison shop. Remember your Commissary and Exchange can offer you savings year-round.  Utilize these savings opportunities as you would your other military benefits.

Tip 3: Restrain spending for birthdays and holidays, especially Christmas. A few well chosen gifts are likely to be more appreciated than a more costly pile of gifts chosen thoughtlessly in a shopping mall foray.

Reduce High-Cost Debt

Tip 4: Interest rates on credit card debts and other retail credit lines can easily run 25 percent. You can save hundreds, perhaps thousands, of dollars a year by paying off these high-cost debts. If you are located at a military installation you can get assistance at the Family Readiness Center for free.  Personal Financial Managers and Counselors are there to help and can be a great asset in getting a debt repayment plan in order.  Another resource is MilitaryOneSource (1-800-342-9647) they also offer free financial counseling.

Save For Emergencies 

Tip 5: Build an emergency fund to avoid having to take loans to pay for unexpected purchases. That fund is usually best kept in a savings account, despite the low interest rates such accounts pay right now. But do try to keep a high enough balance in the account to avoid monthly fees many on-base banks and credit unions participate in Military Saves Week and offer great savings options during the Week and throughout the year. To learn more on emergency savings, click here.

Tip 6
: Set up an automatic transfer each pay period or month from your checking to your savings account or through an allotment. Even as little as $10 or$15 a month helps. After all, that’s $120 or $180 a year.

Tip 7: Put all your loose change in this savings account. For many people, that could add up to well over $100 a year.

Take Free Money and Save it

Tip 8: Low- and moderate-income workers qualify, each year, for an Earned Income Tax Credit that can put over $1,000, and often more than $2,000, in your pocket. The EITC Assistant tool provided by the IRS can help you determine if you qualify to claim the credit, or you can contact your local tax payer assistance center for in-person help. Then be sure to save at least half of this windfall.

Tip 9: Participate in a local Investment Development Account (IDA) program. In return for attending financial education sessions and agreeing to save for a home, education, or business, you typically receive $2 for every $1 you save through an IDA program. So, $25 that you save each month ends up as $900 at the end of a year.

Tip 10: Participate in the Thrift Savings Plan or Save at Work. While we encourage letting this money build up until retirement, it can be withdrawn, or borrowed on, to cope with serious emergencies.

 

 

 

Miracle of Compound Interest

Written by Super User · 09 May 2012

The chart tells the story

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Back to For Savers

Financial Products

Written by Super User · 08 May 2012

Banks, credit unions and even the government offer a variety of financial products that can help you save.  Find out which one is right for your goals.

Savings Account
Online Savings Account
Certificate of Deposit (CD)
U.S. Savings Bond, Series EE
U.S. Savings Bond, Series I
Money Market Account

Type of Product

SAVINGS ACCOUNT (bank); SHARE ACCOUNT (credit union)

Minimum Initial Deposit

Usually $25-100 but make certain monthly fees are not charged for small balances

Yield

Usually 0.2-0.5%

Safety

Government-insured*

Access to Funds

Immediate

Where to Purchase

At any bank, thrift, or credit union

How to Purchase

In person, online, or by phone

How to Make Deposits

Through tellers, ATMs, or automatic monthly transfer from checking account

Other Features

At many institutions, minimum balance of $100-500 is required to avoid monthly fees or automatic transfers of $5 - $25 a month.

 

 

Type of Product Online Savings Account
Minimum Initial Deposit As low as $1 at some institutions
Yield Usually 0.10-2.0%
Safety Government-insured*
Access to Funds Immediate
Where to Purchase At any bank, thrift, or credit union
How to Purchase In person, online, or by phone
How to Make Deposits By transferring money from a checking account, or through direct deposit.
Other Features Confirm that the online institution is insured.

 

Type of Product CERTIFICATE OF DEPOSIT (bank); SHARE CERTIFICATE (credit union)
Minimum Initial Deposit                               
At most institutions, at least $500
Yield Usually 0.05-1.5%
Safety Government-insured*
Access to Funds Immediate but interest penalty
Where to Purchase At any bank, thrift, or credit union
How to Purchase In person, online, or by phone
Other Features Certain financial institution will notify you when CD matures

 

Type of Product U.S. SAVINGS BOND, SERIES EE

Minimum Initial Deposit

As low as $25 ($50 for payroll deduction)

Yield

Usually 1.5%

Safety

Government-guaranteed

Access to Funds

 

After first 12 months, immediate access but loss of 3 months interest

Where to Purchase

 

The U.S. Treasury www.treasurydirect.gov

How to Purchase

 

Through www.treasurydirect.gov where savers can buy electronic (no paper) savings bonds for themselves or as gifts for others.

How to Make Deposits

 

www.treasurydirect.gov allows periodic deposit or checking account deductions to purchase bonds

Other Features

 

Cash in after 30 years (no more interest earned after held 30 years)

 

Type of Product U.S. SAVINGS BOND, SERIES I (with inflation protection)

Minimum Initial Deposit

As low as $25

Yield

Usually 0-2%
Safety Government-guaranteed

Access to Funds

 

After first 12 months, immediate access but loss of 3 months interest

Where to Purchase

 

The U.S. Treasury www.treasurydirect.gov

How to Purchase

 

Through www.treasurydirect.gov where savers can buy electronic (no paper) savings bonds for themselves or as gifts for others.

How to Make Deposits

 

www.treasurydirect.gov allows periodic deposit or checking account deductions to purchase bonds

Other Features

 

Cash in after 30 years (no more interest earned after held 30 years)

 

Type of Product

Money Market Account

Minimum Initial Deposit

As low as $250 at some institutions

Yield

Usually 0.10-2.0%

Safety

Government-insured*

Access to Funds

Immediate access

Where to Purchase

In person, online, or by phone

How to Purchase

Ask for a Money Market Account

* Accounts at some credit unions are privately insured.

Saving with U.S. Savings Bonds

Written by Super User · 09 May 2012

Helping People Save - Ready.Save.Grow. is a U.S. Department of the Treasury initiative to help people save and take control of their future.

Setting money aside for the future is an important step toward reaching your long-term goals, whether that means saving for your child’s college education or preparing for a more comfortable retirement. Learn how convenient saving can be with Treasury securities.

Treasury savings options are:

  • Affordable. You don’t need a lot of money to save with Treasury savings options. You can purchase a savings bond for just $25 and other Treasury securities starting at $100.
  • Safe. You can safely buy and manage Treasury savings options online through the Treasury Department's secure TreasuryDirect web-based system.
  • Convenient. You can buy Treasury securities online, 24/7—no more waiting in line. You also can purchase savings bonds or other Treasury securities automatically through payroll direct deposit.

Get Ready to Save and Grow your savings and gain control over your future.

About Savings Bonds
Treasury Securities Options
Learn more about the Gift of Savings Bonds
How to Buy Digital Savings Bonds as Gifts (You Tube video)

Another great time to save with U.S. Savings Bonds is at Tax Time! U.S. Savings Bonds are one safe and easy way to do it.

There are a lot of great reasons to buy U.S. Savings Bonds at tax time.

  1. You do not need a lot to get started — start with as little as $50. Use just part of your tax refund to start saving.
  2. It is simple at tax time. Just select the amount you want saved from your income tax refund and you’ll receive your bond in the mail.
  3. Earn interest. Your money starts growing immediately.
  4. Bonds are safe. Bonds will never lose value and they are backed by the U.S. Government.
  5. No fees. There are no fees to buy or cash in your bond.
  6. Money for the future. You help your loved ones live their dreams when you buy bonds.
  7. Gift savings to your loved ones. Bonds can be purchased in someone else’s name – so you can help jumpstart the savings and dreams of the people you care about.

What are tax time bonds?
Tax Time Savings Bonds are Series I U.S. Savings Bonds. Issued and guaranteed by the U.S. Treasury Department, Tax Time Savings Bonds can be purchased directly on your tax form. You can cash in your bond after one year at most banks or credit unions, but the longer your keep it the more it will grow in value. Your bond will earn interest for up to 30 years. If you cash your bond within 5 years, you’ll lose the last three months of interest.

The current interest rate on Series I Savings Bonds is 3.1% through April 30, 2012, and will adjust for inflation every six months. Bonds offer competitive returns in comparison with other savings vehicles.*

Growth on your bonds is guaranteed! Bonds make saving safe, simple and secure.

Visit www.bondsmakeiteasy.org

Connect on FB http://www.facebook.com/bondsmakeiteasy
Connect on Twitter https://twitter.com/bondsmakeiteasy

 

Resources

Written by Super User · 08 May 2012

Click to jump to a category below:

Tax Time Resources
Save and Invest
Military and Government Financial Websites
Publication Resources
Additional Financial Resources
Consumer Protection
Youth Resources
Financial Calculators and Worksheets
Fun Financial Games
Military Service Branch Websites


Tax Time Resources

30-40-30 Savings Flyer
7 Ways to Make the Most of Your Tax Refund
Use Your Tax Refund for Debt Relief
Encouraging Financial Education at VITA sites

Save and Invest

Military and Government Financial Websites

Publication Resources

Additional Financial Resources

Consumer Protection

Youth Resources

Financial Calculators and Worksheets

Fun Financial Games

Military Service Branch Websites

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Tip of the Day

  • Written by Guest Blogger | May 28, 2014

    A #credit score may be used to decide the terms you are offered or the rate you will pay for a #loan. Learn more at http://ow.ly/C7EDv

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