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What Should I Do With My Savings?

Have you managed to save up a bit of money? Good for you! Saving money can be hard work, and it’s great to have some extra funds. But what should you do with all your saved up cash?

We take a look at some options when you find yourself with more money than you need for everyday expenses.

Open A Savings Account

The most obvious thing to do with your savings is to put them in a savings account. This should be separate from your transactional account (or the account you use for normal spending).

The advantages of a savings account are that you can add more money to it over time, allowing your savings to grow, and you can earn interest on the money there. Additionally, if something unexpected happens and you need access to your money, you can easily withdraw.

Try to find a savings account with a higher interest rate so your money grows faster, but be aware that this rate may be variable and change over time.

Save With A Term Deposit

Looking to make your money grow faster? A term deposit gives you a higher interest rate than a savings account, and the rate is fixed. This means you know the return that you will get on your money. A term deposit is a great option for people with a sizeable sum looking to lock it away for a year or more and watch it grow.

However, it’s important to remember that you can’t access your term deposit money without paying a fee. You also can’t add any further savings along the way, so it’s best to wait until you have a good nest egg and then put it into a term deposit.

Invest In The Share Market

If you have money that is surplus to your everyday needs, it can be tempting to make this money grow via investments. While buying shares can be a great way to set yourself up for the future, it’s important to remember that investing is different to saving—it might not be a good idea to make it your only strategy.

If you already have some money tucked away in a savings account or term deposit, then you might want to consider purchasing shares. Do your research and make sure you invest in different areas, rather than all in one company or industry. Remember, while it’s possible to make money from selling shares, the market can be highly unpredictable. There is no guarantee that your shares will be worth more than you bought them for in the future.

Your best bet when it comes to shares might be to seek some professional advice.

Purchase Property

A lot of people save up money for the purpose of purchasing property. Getting on the property ladder is a great way to set yourself up for the future, and saving up enough for a deposit is a great achievement. House prices in Australia have been growing steadily for a long time, so property is generally viewed as a solid investment.

Make sure you do your research and purchase a property that is not only going to suit your present needs, but also serve you in the future when it’s time to sell. While it can be tempting to spend everything you have on the perfect property, remember to keep some savings tucked away for unexpected events and expenses.

Sally Writes 10 May 2021