A long term savings account offers many benefits and opportunities to the account holder because it provides consumers the opportunity to earn money with low risk than other long term investments, for example, stocks. The interest rate can be paid on a monthly or yearly basis, according to the amount of money stored in the savings account. In addition a long term savings account is also a great tool for people looking to save for retirement or an emergency fund. There are many ways to open a long term saving account, you can get information from several sources, for example, friends, the Internet, discussing with a financial planner and visiting your local financial institution.
Things you will need to open a long term saving account
Your monthly income and expenses
Your credit score and report
A calculator, pen and two writing sheets or papers
Steps to open a long term saving account
know the purpose of opening the savings account, are you saving for retirement, a new purchase, a vacation or a college education fund.
Determine the source of funding for the long term savings account. Add all your monthly income then subtract your monthly expenses to verify if there any extra funds left, which could be used for the account funding among others. According to fool.com, you should pay all debts, because they accrue over time like interest on a long term savings account.
Search for a bank, which gives the best saving interest rate that suits your needs. Search online or conduct a survey of your local banks then choose the one that provides the best long term savings rate. Bankrate.com offer resources to educate users select long term financial products.
Fill out the application form with all necessary information and submit it. This process could be done online at the bank’s website or at the local branch. After some verification, the savings account will be opened if the bank approves the application.
Tips and warnings
If you need help planning your monthly budget to locate funds for the long term savings. Read the article I wrote titled “Planning a Household Monthly Budget”.
1. Fool.com: How Do I Invest?
2. Bankrate: CD Rates: Highest Yield Bank Certificate of Deposit Interest Rates