GREENSBORO, N.C. — As we start the new year, many of you might have the resolution to get your finances under control. Financial professional Scott Braddock with Scott Braddock Financial gives simple ways to save more of your hard-earned money.
Q: What can we do to start saving more money?
A: Get your free money.
- One in three Americans leave free money on the table by not taking full advantage of their employer's 401(k) match, according to SmartAsset
- The majority of employers will match your 401(k) contributions. The average match is 4.3%
- Scott Braddock recommends contributing 10-15% of every paycheck to your 401(k). If that isn't feasible, at least contribute enough to get the company match
A: Get organized
- Prep for grocery shopping. Plan out your meals for the week so you don't buy extra items
- Map out major purchases. Wait for deals on electronics and other big-ticket items you plan to buy
- Track your monthly expenses and cancel subscriptions you don't regularly utilize
Q: What is the difference between CDs and savings accounts?
A: Savings accounts are offered through traditional brick-and-mortar banking institutions. They pay interests predetermined by the bank and are subject to change based on current interest rates.
CDs pay higher interest because they come with a set term. Investment is tied up during the term and a penalty will be assessed if you close out the CD early.
Q: What are high-yield savings accounts?
A: These types of savings accounts offer much higher interest rates and are usually offered by online banks. The interest is variable and can be as much as 10 times more than regular savings accounts. However, they may have fees, such as maintenance fees, transaction fees, inactivity fees, and ATM fees. A regular savings account might be better for someone who values convivence and flexibility over interest.
Braddock also recommends you challenge yourself with the nickel challenge.
How it works: On the first day save a nickel and increase your savings by a nickel each day. If you do this for a year, the most you'll set aside is $18.25 on day 365. After a year, you will have saved $3.385.05.