You are building up a bit of a savings and want to place it in the best place so that you have either easy access or a good return on your savings or, both. You might be a little unsure about what is out there, like me. So let’s take a look at a few pros and cons of saving your cash.

1. Hide it in a hollowed out book or under the mattress 
- Easily accessible in an emergency
- Very convenient since you don’t have to travel to ‘get’ your money
- Handy if you don’t trust someone else to hold your money
- No interest is being added to your money. What you see is all that is there
- You could forget where you stashed the money, you could be burglarized, or a Fire could take your money
- Easy access can make it easy to spend

2. Savings Account
- Max wait time to get money would be 2-3 days, so handy for an emergency
- Pays Interest – though it is low, it is better than nothing
- Easy to open and take very little to set up
- Federally Insured up to 100,000 dollars
- Interest isn’t that high and higher rates can be found elsewhere
- Can be tempting to spend if you can access it easily with an ATM card
- There could be a minimum balance to keep the account open
- May require opening a checking account as well

3. Money Market Account
- Usually have a higher interest rate, but it varies greatly
- You can get the money by writing a check
- Can be opened in most any bank
- May require much more to open an account
- Many come with limited check writing privileges
- Fees could be assessed for going under a certain minimum in the account

flickr/cc - Rev Dan Catt

4. Money Market Mutual Funds 
- You can be aggressive or conservative with your investment
- A potential for higher interest earnings
- More accessible than a CD or Treasury (further down the list)
- You can automate regular deposits
- No guarantee on your rate of return
- You can access the money at any time, so it could be tempting
- Money is not Federally Funded
- There are many fees associated with a MMMF
- You need a good chunk of money to open one

5. Certificates of Deposit 
- You can cash out before your term is up
- You can ‘hide’ money away for 6 months or more
- The Interest rate is set
- Need to shop around for the best rate
- Taking money out early could cost you some or all of your interest
- Some CD's need at least $500 to $1,000 to open

6. Savings Bond 
- You are making an investment in the Government
- Excellent for a long term investment
- Fairly predicable rate
- Low minimum - $25 for an EE
- They are backed to some extent by the government
- You can buy them for others very easily ( just need their SS number)
- Not easily accessible without losing a lot of interest
- You can get better rates elsewhere

7. Treasuries

- Backed by the government, but if they can’t pay it the country is in deep doo-doo. All through out
   government history for Treasuries, it has always been backed up and still is thus far.
- Commonly used by retirees as a way to bring in a little income and still be a safe investment
- Principle is yours
- Interest is exempt from state taxes so that is nice for those who have high state taxes to pay
- Pays interest every 6 months
- You need at least 1,000 dollars to invest in Treasury Bills, other than savings Bonds
- If you sell early you are at the mercy of the going rate
- This is a long term investment. Notes are 2-10 years and Bonds are 10-30 years
- You may be able to get a better rate elsewhere for the time frame


  1. Hammy // Saturday, July 17, 2010 7:17:00 AM  

    Could store your money in a sock.

    Offset account against your home loan is the best place as it gets the same rate of interest as your home loan charges (if 100% offset) and it's instantly accessible if you need it.