Where to Stash Your Savings

By Kennedi Rose / January 21, 2013

You work hard for your money. You don?t want your hard-earned cash to languish in some low-rate savings account, losing its value against the ?invisible cost? of inflation.

At the same time, you don?t want to gamble your money away in the stock market while chasing risky returns.

What can you do to protect the money you earn?

1. Look for a High-Rate Savings Account.

Find the best fixed rate SAVINGS ACCOUNT by visiting websites that list the current market rates. These accounts will pay you money just for keeping your cash parked in their accounts. You won?t have to expose your money to high levels of risk, like you would if you bought shares of Coca-Cola or Nike.

2. Buy CD?s

A certificate of deposit, or CD, is a long-term ?investment.? I use that word in quotation marks because it?s virtually risk-free. As long as you don?t withdraw your money before the agreed-upon time, you won?t lose anything. You?ll get your principal back, plus some interest.

CD?s vary in length from 3 months to 2 or more years. The drawback? Your money is tied up for that time.

3. Consider Money-Market Accounts

A money-market account is similar to a savings account, except it?s not protected or guaranteed by the government. It sometimes pays higher interest rates than normal savings accounts.

But there?s a drawback: there are also limits to how many withdrawals you can make from a money-market account each month.

4. Buy Bonds

When companies or governments need to borrow money, they issue ?bonds.? A bond is a promise made by a company or a government that they?ll pay back their creditor ? that?s you! ? at a fixed rate, and at a fixed time. Bonds are slightly higher-risk (the company or nation might default), but they?re still relatively safe.

On the bright side, interest rates are starting to climb at many banks. That?s good news for people who save money. So check out some real-time rate quotes, and find the best accounts for you!

About the author

Kennedi Rose

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