If you have savings account rates on the brain, you are not
alone. The latest New Year Financial Resolutions Study from
Fidelity Investments finds that savings is a priority for most of
those making financial resolutions in 2013.
The study
discovered nearly half of the survey respondents -- 46 percent --
are considering financial resolutions for the upcoming year. That's
the highest rate recorded by the study, now in its fourth year.
Of those resolutions, saving is the top goal for most Americans.
The top three goals in the survey were as follows:
- Save more: 52 percent
- Spend less: 19 percent
- Pay off debt: 19 percent
On average, survey respondents reported wanting to save $2,400
toward both short-term and long-term goals. While resolutions can
be notoriously tough to keep, 62 percent of respondents say they
followed through on their financial resolutions from last year.
Retirement is the main savings goal
Long-term goals are the biggest priority for consumers,
according to the Fidelity study. Of those planning to save, 62
percent cite long-term needs, compared to the 29 percent who report
saving for short-term goals.
Not surprisingly, retirement was the most often mentioned reason
for saving:
- Retirement: 48 percent
- College savings: 46 percent
- Retiree health care costs: 34 percent
Short-term savings goals cited in the survey include
building an emergency fund
and funding a big-ticket purchase, such as a television or
computer.
Different accounts for different goals
If you are one of those planning to focus on long-term or
short-term savings goals in 2013, you may want to look closely at
where you're storing your money.
For long-term goals such as retirement and college expenses,
specialized educational funds, such as 529 plans, may offer tax
benefits on the money you set aside for education. If your employer
provides a match to your 401(k) plan, contributing to it may equal
free money for your retirement savings. Roth or traditional IRAs
may also prove helpful in designing a effective retirement savings
plan.
Money for short-term savings goals, such as building an
rainy-day fund, is often best stored in an easily accessible
account. Savings accounts can offer a safe and liquid place to keep
emergency cash. While interest rates may be minimal at some banks,
savings interest rates tend to be higher at online banks, according
to recent MoneyRates.com
America's Best Rates
surveys.
For purchases that may be down the road, such as those for major
electronics or home repairs, CDs may offer an attractive
alternative to savings account and money market rates rates. But
because these accounts offer less access than other accounts, it's
important to only store money in these that you aren't likely to
need before the maturity date -- unless you can find an account
with a mild penalty for early withdrawal.
If you are planning to
prioritize saving in 2013
, choosing the right account is an important step. While savings
resolutions aren't always easy to keep, having the proper account
can help you maximize every gain you make.