At this point in your life, we’re guessing you’ve chosen a credit union or bank for your financial needs. And you’ve probably already opened up an account with them. But now that you’re getting older, your financial needs are changing—so maybe you should take a closer look at what accounts are best for you to save for your future.
The Right Fit
What kind of account you need all depends on what you expect to do with it and/or get out of it. There are four basic kinds of accounts to save your money in:
- Checking – Where you can deposit your money and have easy access to it for bills and spending money. You usually don’t get interest on these. (Also known as a share draft account at your credit union.)
- Savings - Where you put money that you don’t need right away, but could soon need for things like short-term goals. You earn low interest on this one.
- Money Market Account (MMA) - Where you save money for your safety net, emergency fund or bigger ticket items. They’ll give you a higher interest rate than savings, but the amount of monthly transactions is usually limited.
- Certificate of Deposit (CD) – Where you save money over a specific time period for future goals. You’ll get a higher interest rate than the other options, but you have to wait for the time period to be over to access your money—or pay major penalty fees if you can’t wait that long.
Depending what your savings needs are, you might open a combination of any of the above accounts to help you reach your goals. Here’s what you’ll need to have with you to open an account:
- Money to deposit (obviously)
- Photo ID like a driver’s license or passport
- Proof of address like a utility bill
If you’re opening a joint account, both of you will need these items.