for the next 23 months, trying to set aside a decent amount of money for when I get out and start college back up, figure just tossing it into a savings account would bring my total to be ~25k

What say you TWW?

3/19/2010 7:45:17 AM

...good job?

3/19/2010 7:52:34 AM

Haha, I get paid ~1200 a check (get paid twice a month), have virtually zero living expenses, my only bills are car insurance (paid off for the year), a pay as you go phone, and a 40 euro a month internet contract. Plus, I got a deployment coming up with means tax free and combat pay..It's going to be very easy for me to bank 50-60% of my money, I just want to know the most efficient way to do so.

3/19/2010 7:55:52 AM

what are you looking for our opinion on? Where to invest the money? what to do with it? or what?...answered my question too ha.

If this goal is starting at 0 and you are adding $1000 to the account 1x a month for 23 months, you prob won't be at $25,000 in 23 months with just a normal savings account (unless you are getting some great 12 mo introductory rate or something). Not that there is something wrong with that as the most important step is saving the money in the first place, just letting you know.

[Edited on March 19, 2010 at 7:56 AM. Reason : ]

3/19/2010 7:55:56 AM

do you have anything saved up already? ^ is right, a normal savings account won't gain much interest. But there are some money market accounts out there that have specialty rates if you open it up with a nice sized deposit.

3/19/2010 7:58:02 AM

the best CONSISTENT rate i've seen on savings is 2% from SECU...compounded monthly, assuming no drop in rate (which is probably a safe bet), and with $0 starting balance, you're looking at something around $24,400 after 23 months

$1400 isn't bad, but it's hardly spectacular, given the amount of time

i miss the ING direct 4.5% glory days

3/19/2010 8:05:28 AM

yea, the MMA my wife and I have is from New Dominion in Charlotte which normally has solid rates but it is even down to under 2% for us . But that is still better than what we get in our normal savings acct by a lot.

Our bank right now is offering 3% on CDs if you invest an even quantity in a 26 month and a 49 month CD. I'm thinking about dumping $10k ($5k in each one) in there just for a decent rate. I want to ask a few more questions first like what the penalty is if I needed to get to the money, but I'm planning on throwing money in there that we wouldn't need unless it was a dire emergency anyway.



[Edited on March 19, 2010 at 8:27 AM. Reason : ]

3/19/2010 8:22:26 AM

^^SECU's savings and money market rates just dropped to 1.5%. A far cry for the 4% it was at just a few years ago.

I'm thinking of pulling my savings and seeing how much interest will collect in a jar under the mattress.

You could try putting $1000/month into a CD to try and squeeze a bit more interest out of it. Then your money would free up each month as the terms on 23 individual CDs expired. Of course I doubt there would be that much difference in interest rates on a 2 year CD to make that worth it.


[Edited on March 19, 2010 at 8:40 AM. Reason : -]

3/19/2010 8:22:29 AM

Quote :

"SECU's savings and money market rates just dropped to 1.5%."

well, damn...sure enough

3/19/2010 9:01:47 AM

SECU will always have slightly better deposit rates.

2 years is not a long time horizon so I would not suggest putting it in the market either.

3/19/2010 11:34:54 AM

Capital Bank still has 4% on the first $10,000 in your checking account.

3/19/2010 11:45:46 AM

I'd put half into CD's, the other half into mutual funds. You should end up with a solid 12-15% return over the course of the year.

3/21/2010 3:57:14 PM

3/21/2010 5:21:48 PM

Welcome to Finance 101 and the introduction of the concept of "risk".
- Most folks on here are mentioning sticking this in a savings account of some sort. This is the least risky course of action, and has the least rewards, maybe 1-1.5% increase on your money. The other advantage, your money is accessible at any time in a savings account.
- A Certificate of Deposit (CD) will get you varying returns. For a two-year CD, we see 2-2.5%. Disadvantage is you cannot (easily) get you money out while you have a CD.
- A money market account will grant you 3-5% increase. This is also low risk, however, there are more restrictions about when and how you can get your money out.
- After this, you start putting your money into stocks or mutual funds, which can fluctuate widely. As Noen mentioned, a 12-15% return via this method isn't uncommon, but also carries a fair degree of risk with it.
*Overall, it really depends on how much time and effort you want to put into this.

Here's what worked for me: Find a bank or credit union that offers a promotional rate on a checking / savings account. While I was building a house, I needed access to our saved cash quick, and, with no risk or restrictions. I already had an account with Coastal Federal Credit Union, and, they offered a 4% rate on a "Green" checking account IF you used your debit card 12 times or more per month. Coastal wasn't my primary bank, and I wasn't going to switch everything over, so I really wasn't sure how to hit that 12 times per month. Yet, I'm sitting there with tens of thousands of dollars and want to collect interest on it. Self-check outs at grocery stores ended up working in my favor. One item at a time, 10-15 minutes once a month, I'd get a couple hundred dollars in interest per month.

smc, that looks pretty sweet / similar to CFCU.

[Edited on March 21, 2010 at 6:15 PM. Reason : .]

3/21/2010 6:04:59 PM

^

Quote :

"Simply use your new Go Green Check Card! You'll earn 2.25% APY* each month 12 debit purchases are posted to your account."

3/21/2010 9:29:06 PM

Southern Community Bank and Trust has this going on and offering 4%. http://smallenoughtocare.com/ContentPageRed.aspx?name=ME+Banking+

3/21/2010 10:29:17 PM

^^
Yeah, they have dropped their rates since they initially offered it . Like ING in 2007 , I hit a good rate while it was going. smc's post grabbed my attention, as that bank IS in fact located where I live, which is unusual. More focused now on paying off debt right now than any large (>$10k) amount of savings, so not for me, but, may appeal to other's.

Another thought, and take it for what its worth. Pay your bills, put aside a (small) amount of money for personal spending, then stick the rest in savings. Even if you do not wish to buy for yourself, nice to have cash on hand to send something on Mother's Day, birthdays, etc.

[Edited on March 22, 2010 at 6:31 AM. Reason : .]

3/22/2010 6:27:59 AM

IBTWOCHICKSATTHESAMETIME

3/22/2010 8:06:45 AM

Quote :

"^^SECU's savings and money market rates just dropped to 1.5%. A far cry for the 4% it was at just a few years ago."

I agree. I just got my statement in the mail the other day. I have about 7k in shares, I was going to move it to Money Market but the investment is the exact same as shares (1.5%) and requires me to keep 250 in there where as shares was only 20.

3/22/2010 8:11:12 AM

I wouldn't ever keep more than the minimum $25 in shares.

3/22/2010 1:55:50 PM