3 Big Savings Goals and How to Reach Them
Some things are pretty much impossible to finance with the cash you have on hand at the time. So, unless you want to go deep into debt, saving money in advance is a necessity. While you could save for a big purchase just by stuffing money in a bank savings account, that's not really the best use of your cash, given that bank savings accounts pay a minuscule rate of interest. Instead, consider using an account that will help your money to grow even as it sits there -- the more money that your money makes for you, the less you have to save to finance your big purchase. Here are some common major expenditures and the best ways to save for them.
Your retirement is likely the biggest single expenditure you'll ever make.
Fortunately, the government has come to your assistance by creating several tax-advantaged accounts designed specifically for retirement savings. The various forms of IRA and 401(k) accounts let your money grow tax-free, meaning that you'll make substantially higher returns than you would from the exact same investments in a standard brokerage account. In fact, these accounts are so good for savers that the IRS has put contribution limits on them to keep you from hiding all your money away from the agency.
Source: Fool.com
