Save for Unexpected Expenses Lost/stolen items Accidents Repairs Save for Unexpected Opportunities Good deals Save for Major Purchases Home Car Computer Save for Flexibility More money means more choices Save to Achieve Life- Span Goals College education

Make a savings deposit with every paycheck; don’t spend it Save a set percentage of whatever you make Use a small reward every time you make a deposit to encourage yourself Focus on what you value most when you are considering spending money Set up an automatic savings plan with your bank

Savings Account Safest way to save and earn interest FDIC insured Certificate of Deposit (CD) Pay higher interest rate than savings account Fixed interest rate for a fixed time period Require a minimum deposit Penalty for early withdrawal FDIC insured Money Market Account Pay higher interest rate than savings account Interest rates changes Require a minimum deposit Can withdraw money any time without penalty Some are FDIC insured, some are not (check)

 Bond – a written promise to pay a debt by a specified date  Savings bonds are non-marketable (can’t be sold to another person)  Pay taxes on interest only when redeemed  Series EE savings bonds – fixed interest rate  Series I savings bonds – interest rate varies

Annual percentage yield (APY) – the actual interest rate an account pays per year

 Principal – the money you have on deposit in a savings account, CD, or other savings option  Interest is calculated on your principal  Simple interest – interest paid once a year at the end of the year on the average balance in a savings account  Compound interest – interest paid on the principal and on previously earned interest, assuming the interest is left in the account