Individual needs basically drive the savings patterns

As children we all grew up saving money in piggy banks and always felt that we had a fortune every time a little coin was dropped into these piggy banks.  However, as we get older and as we begin to age, our savings are distributed in various places and they no longer resemble the piggy bank in any way.  Though the method of saving might differ, the end results are pretty much the same.  Savings are driven entirely by one’s individual needs.

There are different savings programs for different individuals and each savings program might be suited for specific people.  No savings program will ever cover all the aspects.  Hence, it is up to the individual to choose between various options depending on what they want with regards to the benefits offered in each program.  Some of the best features of these savings programs are listed below and as you view the entire list you will notice that each savings program will have its list of pros and cons.

Now Accounts:

There is a minimum requirement of $2,500 to open these accounts.  There must be a minimum balance that has to be maintained in these accounts but money can be withdrawn anytime.  There is a fixed interest to be earned on this account and that is set by the bank.  The money is insured by the FDIC up to $100,000.  The interest gained is taxable.  This is an account that is safe, liquid, and located in the nearest bank.

Bank CD’s: 

These CD’s have more or less similar features such as a Now Account the only difference being that the amount required for opening a CD can be a smaller amount like $100.  The interest rates are higher because these accounts come with a maturity date.  Unlike the Now account, early withdrawals will attract penalties.

U.S. Treasury issues:

Almost all accounts that are listed here have a minimum deposit that is required while opening the account which could range anywhere between $1,000 to $10,000.  The U.S. Savings Bonds have the lowest requirement of $25.  These Treasury Issues (government bills, notes, securities etc) come with a date of maturity and the market conditions will determine the rate of interest that will be set.  All the interest earned is taxable and they are backed by the Federal Government.  So, there are pros and cons with each savings account as each account is different from the other.

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