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Why You Need to Bulk Up Your Savings

Why you need to bulk up your saving

We all know saving is important, but some of us don’t realize exactly how essential a solid nest egg can be until it’s too late. Having serious assets in your savings products is essential at any point in life, and here are a few reasons why:
  1. Anything Could Happen.
It might sound obvious, but think about your friends, family, co-workers, and neighbors… Have they fallen on hard times at some point? We all know someone who has had something happen unexpectedly. A spouse passes away, someone loses their job suddenly, needing medical treatment, divorce, accidents… The list goes on and while we don’t want to think about it all the time, it is important prepare. You might say, “There are resources to help in these situations. Unemployment benefits, disability, insurance, financial aid, spousal support, etc.” That may be true, but nothing beats your own savings and depending on the severity of a situation, sometimes we need both assistance and our own savings. When difficult times arise, you don’t want to find yourself worrying about qualifying for assistance or waiting for benefits without a savings to keep you going.
  1. Tax Breaks
Some savings plans offer generous tax breaks. Both Traditional and Roth IRAs provide breaks, but it is a matter of when you get those breaks. Contributing to a Traditional IRA is both state and federally deductible the year you contribute, while contributions to Roth IRAs are not tax-deductible, but earnings and withdrawals are typically tax-free*. If your employer does not offer a 401(k), it does not mean you can’t have a retirement account out there. Everyone, even the youngest of adults, should have a retirement account and every year that you don’t have one is like money lost for taking care of yourself in your older age.
  1. 2018 Saw Rate Hikes From The Fed
The Federal Reserve has raised rates four times in 2018. For consumers, this means you’ll notice these effects in borrowing. Luckily, you can take advantage of these rate changes through savings. Higher yield accounts are experiencing better rates and CCU has two special rate CDs for you to take advantage of. Rate specials are something you do not want to miss out on, so it’s important to be on the look out for good rates to stay ahead of any inflation that might occur. If you’re not an experienced saver, you can still get help finding the right account for you. For savings beginners, you might want to consider short term CD or a Christmas Club account (yes, we also have a rate special for our Christmas Club accounts – don’t miss out!). With these accounts, you can experience what it’s like to save and much you can put away and still have enough for your monthly spending. If you don’t know the ins and outs of these sorts of accounts, it’s okay. At CCU you can get help, guidance, and consultation at no charge to you. We have an investment expert that help you look at a long term and retirement goal, and any of our Member Services staff can tell you more about CDs and club accounts. Life happens, and when it does, Centricity is here.

*Consult a tax advisor.