How to Safely Make the Most of a Healthy Savings Account
While some people struggle to save money regularly and to keep a reasonable amount of money in an emergency savings account, others have achieved great results from their saving efforts. If you have checked your savings account balance and have determined that the balance is healthy, you may be wondering how you can make the most out of your savings funds without creating unnecessary risk.
Set a Goal
Your savings account balance should be determined via a specific strategy, but there are multiple strategies to consider. For example, some people have a comfort zone of between six to nine months of expenses in a savings account. Others want a full year of take-home income in a savings account. Another strategy is to have enough money to cover a few months of expenses as well as to pay your health, home and auto insurance deductibles all at the same time. Find a target goal that is comfortable for you. Also, don’t be afraid to find some help. A quick online search for something like ‘NJ wealth management team’ can help you find professionals nearby. More on that later, though.
Use Various Savings Plans and Programs
Keep in mind that there are various ways to save money. While you may want to keep some of your savings in a regular savings account at the bank that generates a minimal amount of interest, you may also use a health savings account, a flexible spending account or other options. These types of accounts offer tax benefits, but the money must generally be used in very specific ways. Consider estimating your need for cash in these accounts before allocating money to them. For example, you may be required to use all money in an HAS annually, or you risk losing the money. You can estimate the cost of prescription medications, doctor visits and more annually to determine how much money you should allocate to this account.
Hire a Wealth Management Team
After you have a healthy sum of cash in a savings account or in alternative savings programs, you may be ready to start investing additional funds. For example, you may allocate extra money each month to stock purchases after you feel comfortable with your savings account balance. Hiring a wealth management team like those found at rmrwealth.com can be an effective way to get expert investment advice.
Your personal savings provides you with financial security and may be instrumental in helping you to get out of a jam. However, a traditional savings account is only one of many vehicles that you have access to. Now is a great time to explore alternative savings programs and to seek professional financial advice regarding investments.