Establish an emergency fund

Saving for a specific reason is what everyone does but saving for unforeseen events in life is least expected but make sure you do. Apart from the saving you do for future put some finances and add up to your emergency funds.

It is as important as other savings, in fact very. Dealing with health problems, breaking down of a car, gadget, dealing with the aftermath of a natural disaster, theft, job loss or home repairs always arrive unannounced. Typically, having three to six months worth of expenses saved should be sufficient towards emergency fund.

Certificates of deposits

Certificates of Deposits are safest investment option available and people can make. It is sold by banks only and is considered as low-risk and relatively low-return investment option. If you leave the money alone without any withdrawals during the investment period, known as the “term” or “duration”, the bank will pay you an interest rate slightly higher than what you would have earned in a money market or checking account.

All gains from CDs are taxable as income, unless they are in a tax-deferred (IRA) or tax-free (Roth IRA) account. It is well suited for short-term savings needs of a person.

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