MONEY IN THE BANK.

Not every type of bank account is created equal. Some may not require a minimum balance or charge fees—win! While others may penalize you if you take money out at the wrong time.

Basic checking and savings accounts are a great starting place for everybody. And then from there, you can branch out into different types of bank accounts where your money can really start to add up.

1. Checking Account:

The most basic type of bank account is the checking account. Think of it as home base. For most people, it’s where their paycheck gets deposited, where bills get paid from, and where they keep the money they need to get to quickly.

Checking accounts, which you can set up at a traditional or online bank, come with a debit card. It works a lot like cash. But now you don’t have to carry around a pocketful of money. It can go in your checking account instead. Then when you go to the grocery store or gas station, you can swipe your debit card. The amount is usually deducted from your checking account right on the spot.

2. Savings Account:

A checking account and savings account go together like Batman and Robin. They make a great team, and if you’re setting one up, you might as well set up the other.

A savings account is exactly what it sounds like: a place to put your money that you want to save. It’s a great spot for funds that you don’t need right away but want to have nearby just in case.

3. Money Market Deposit Account:

Like a checking account, a money market account might come with a debit card, although some banks don’t offer this feature.And like a savings account, a money market account earns interest (not a lot, but usually slightly more than a savings account) while keeping your money separate from your everyday funds.

This type of bank account is a good place to store your 3- to 6-month emergency fund so that it’s close if you need it but out of your everyday checking account.

4. Certificate of Deposit (CD):

A CD is a certificate of deposit. It’s like a savings account but a savings account where you won’t earn much and you could lose even more. So, it’s more like a certificate of depression—not a place you want to put your money.

There are a range of CD term lengths, or “maturity dates,” and if you withdraw your funds before that date, you’ll get hit with penalty fees. CDs come in short-term (less than 12 months), mid-range (1–3 years) and long-term (4–5 years) ranges.With a CD, you’re basically loaning your money to the bank and they’re “rewarding” you with a little bit of earned interest. The longer you loan them your money, the higher your interest rate will be.

Remember though, that “higher” interest rate is still usually not more than 1–2%. Your bank would love nothing more than for you to lose patience and cash out a mid- or long-term CD early so they can capture those early withdrawal fees.

Which Type of Bank Account Is Right for You?

Part of taking control of your money means making sure you’re keeping it in the best place possible for where you are in your money journey.

If you’re just starting to get ahold of your finances, a checking and savings account is the best place to start.

Then, after you’re completely out of debt and have your 3- to 6-month emergency fund saved, you can start saving for retirement by exploring IRAs and mutual funds.

◾How does it feel being broke, yet you’re employed?

◾How low can you go to minimize your budget for the betterment of tomorrow?

◾What comes first in your mind, what do you prioritize when you first receive income?

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You could be permanently employed with monthly earnings but with no single coin in your savings account. Many people find it difficult on how to start saving, while in some cases, others have gone to an extent of having a savings account with zero balance.

After a thorough research and data collection on finance matters, various ways to start saving money were realized that would probably help you get out of ‘SPEND IT ALL’ zone and remind you to save for future activities.

1. Try The 50-30-20 Rule.

A popular money saving hack, but one you may not have heard of is the 50/30/20 rule.

This means 50% of your take home pay goes on essentials, such as bills and food shopping, 30% goes towards treating yourself and going out, while 20% goes to the future you – AKA investing and savings for a rainy day.

This split may not work for everyone, so feel free to change the percentages to suit your financial needs

2. Track Your Expenses.

This one kind of goes without saying, but keeping track of your expenses is crucial to living within your budget.

You can do this using a (free) budgeting app to monitor all your accounts in one place and manage your spending.

Even simpler than that, you could write down your expenses at the end of the day, as this will help you understand exactly where your money is going.

The more conscious you are of what you’re spending, the less likely you are to overspend or buy on impulse.

3. Use Public Transport.

You don’t need us to tell you that the cost of the fuel at the moment is extortionate, which is why using public transport could be a great way to save money. Granted, it might not be the way to go in all places, but if your city has a good public transport system, we highly recommend that you make full use of it! Public transportation often sells monthly or weekly passes at a discount too.

Alternatively, where possible, try to seek out any opportunity to stretch your legs and get walking. While it’s an easy way to get those 10,000 steps a day in, carrying your shopping bags back will definitely get your heart rate up – who needs dumbbells, eh?

4. Split Subscriptions.

If you use paid subscription services like Netflix, Amazon Prime and Spotify, you could save money by splitting the cost with friends and family.

Most offer a number of users under each subscriber. 

5. Eliminate Your Debt.

If you’re trying to save money through budgeting but still carrying a large debt burden, start with your debt. Not convinced? Add up how much you spend servicing your debt each month, and you’ll quickly see. Once you’re free from paying interest on your debt, that money can easily be put into savings. A personal line of credit is just one option for consolidating debt so you can better pay it off.

6. Set Savings Goals.

One of the best ways to save money is by visualizing what you are saving for. If you need motivation, set saving targets along with a timeline to make it easier to save. Want to buy a house in three years with a 20% down payment? Now you have a target and know what you will need to save each month to achieve your goal. Use Regions’ savings calculators to meet your goal!

7. Take a Staycation.

Though the term may be trendy, the thought behind it is solid: Instead of dropping several thousand on airline tickets overseas, look in your own backyard for fun vacations close to home. If you can’t drive the distance, look for cheap flights in your region.

8. Spend to Save.

Let’s face it, utility costs seldom go down over time, so take charge now and weatherize your home. Call your utility company and ask for an energy audit or find a certified contractor who can give you a whole-home energy efficiency review.

This will range from easy improvements like sealing windows and doors all the way to installing new insulation, siding or Energy Star high-efficiency appliances and products—and even solar panels. You could save thousands in utility costs over time.

9. Utility Savings.

Lowering the thermostat on your water heater by 10°F can save you between 3% and 5% in energy costs. And installing an on-demand or tankless water heater can deliver up to 34% savings compared with a standard storage tank water heater.

10. Create an Interest-Bearing Account.

For most of us, keeping your savings separate from your checking account helps reduce the tendency to borrow from savings from time to time. If your goals are more long-term, consider products with higher yield rates like a CD or money market account for even better savings.

11. Annualize Your Spending.

Do you pay $20 a week for snacks at the vending machine at your office? That’s $1,000 you’re removing from your budget for soda and snacks each year. Suddenly, that habit adds up to a substantial sum.

As you implement these tips into your financial life, remember that where you save your money is important too. Regularly move the money you save out of your checking account into your savings account, where you’ll be less likely to touch it before you reach your goals.

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Those are some of the ways that will help kick you out of your ‘spend-all’ zone and direct you to better ways to start saving from as low as you can.

Always remember saving requires commitment and discipline.

Be dedicated and save from little to more!