How to Make the Most of your Savings

Image courtesy of 401kcalculator.org
Image courtesy of 401kcalculator.org
Many people have savings and they like to keep their money in a safe place where they can get some return on it at little risk. However, when interest rates are low, there is very little return available on the money and it means that you may even find that its value drops as inflation rises. It may be worth thinking about alternative places to put your money or alternative things to buy with it.

Buy antiques/gold
Some people like to buy gold with their money because it tends to go up in value. The feel that it is a safe place for their money as there always seems to be a demand for gold and the supply of gold is very limited meaning that it holds its value well. Others like to put their money in objects which increase in value such as antiques or art. Although this can be a better investment, there is more risk. Antiques may need repair or restoration and they certainly need insuring. There is also no guarantee that they will increase in value. Just because something is old, does not mean that it is necessarily valuable and even if something is old and valuable there is no guarantee it will hold its value. Sometimes fashions change and this could mean that something previously valuable, drops in value. It is often recommended that if you buy painting or furniture you get things that you like so that you can enjoy them.

Invest
Investing will give you a better return but you will need to be prepared to take more of a risk. This may not be something that you are prepared to do but it is worth thinking about it. Some investments are not that risky but it is still possible to get a better return than from a savings account. It is worth looking in some detail and possibly even getting financial advice before you decide whether this is the right thing for you to do.

Long term / Notice Account
It is possible to put money into a savings account that gives a better return but you have to stick to more specific terms. This means that it will not be instant access. So if you can afford to tie your money up for a while it could be worth looking in to. You might have to give a certain amount of notice to withdraw money or you may find that you have to tie it up for a year or a number of years.

Keep comparing
It is worth comparing the rates on different accounts on a regular basis. Switching your money to a different account could make a significant difference to the amount of return you get on your money. Savings accounts do have their rates reviewed regularly so it is worth making sure you are aware of the current rates. Decide how much higher than your rate an alternative needs to be before you will consider switching. You should also check whether there are any fees if you switch.

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Rachel Henderson is a professional freelance writer from the UK. She writes on many subjects but specialises in personal finance. As well as contributing to various blogs and websites she has her own website tracking her own money making process http://www.turnonepoundintoonemillion.com and sells her books through http://www.bowbridgepublishing.com.

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