Optimizing Your Return on Savings (and Keeping it Simple)

Everyone wants to earn more money with the money that they already have. As a basic rule, investors want high returns in order to grow their wealth faster and easier. If earning more money were as easy as merely desiring it, everyone in the world would be a rich person. Instead, it is often quite difficult. It’s hard to predict when a company may go under. It’s difficult to know when an industry may take off before it does. To put it another way, it’s hard to get better returns. Let me reiterate that: it’s not easy… at least most of the time.

While it may be hard to decipher the various levels of knowledge and information when it comes to investing, there are clear and obvious ways to optimize your return when it comes to your savings. To make it better, you can make sure that you are maximizing your return without it being overly complicated. As we often stress, if it is too complicated, you are not likely to follow through (and then all of your hard work is flushed down the toilet.) Here are three ways you can keep it simple and earn more money from your savings:

1 – Don’t Keep it Under the Mattress

While many people love having cash on hand, there is no worse place to keep your savings than in cash (and in your house). Too many things can happen to cause you to lose all of your money in an instant (fire, theft, etc.). If that were not enough, you are also not earning any interest this way. That means as values inflate, your money is worth less and less as time carries on. Take my advice, don’t keep it under the mattress.

2 – Use a Money Market Account

Many people assume that savings accounts are the best thing for them. Too many people fail to consider the alternative: a money market account. These can come with some additional fees, so it is important to read the fine print, but most offer significantly higher interest rates. This means that you can earn more money from your savings without having to do any extra work. You can read more about Discover’s money market accounts if you need to get one.

3 – Limit it to One (or two) Account (s)

Many people get carried away when it comes to optimizing their savings. They constantly look for the best rate and are always transferring from one account to another. My advice to you is to limit the number of accounts that you have. It’s much easier to have one (or maybe two) and that allows you to access everything easily. It also means less maintenance when you move or have to transfer to a different bank.

If you are looking to earn a little more money with the money that you already have, you might want to consider all of your options. Don’t settle for what is convenient. Look at ways to increase your interest income without overdoing it.