Incentives and higher rates these days to help you pump up your savings. Programs like Bank of America’s Keep the Change even kick in some money to help you out in the beginning. Others like SmartyPig.com are dishing out cash-back rewards on their co-branded prepaid debit cards that you can shuttle into savings.
Even so don’t count on debit card cash-back
Rewards programs to help you for long. Chase. Wells Fargo and PNC are among the banks phasing out these debit card programs. Banks are looking at huge changes in revenue due to new regulations. says Ron Shevlin. a senior analyst at Aite Group LLC. a research firm in Boston. The upshot is they’re less willing to hand out incentives.
Multiple accounts. incentives can still be sweet
Ultimately. building savings by paying yourself first with direct deposit is best. says Greg McBride. CFA. senior financial analyst at Bankrate.com. That tactic builds savings momentum. he says.
But for some extra oomph. here are five easy tips to build on your savings:
With Bank of America’s Keep the Change program. every time you make a debit card purchase. the bank rounds up the number to the nearest dollar amount and deposits it in your savings account. The bank also will match your savings for the first three months. up to $250.
The electronic equivalent of dropping
BBVA Compass has a similar program. When you link your checking account with its Build My Savings account. the bank matches a email data percentage of your transfers. up to $250 per year. And U.S. Bank has a S.T.A.R.T. savings program. which hands out a $50 Rewards Visa Card when your balance reaches $1.000. Still. incentives may be more than offset by higher fees and lower yields. McBride says.
Opt for Credit Card Savings Accounts
Some credit card companies are offering tempting online savings deals.
For example. CapitalOne InterestPlus savings paid 1.1 percent on balances of $1.000 or more in late May 2011 for anyone who opens this type driving free construction leads: strategic content writing topics of account. That’s compared to average savings yields of 0.68 percent offered nationally. according to Bankrate’s rate comparison tool.
An American Express online savings account also paid a high yield — 1.15 percent.
“Since they generally don’t have physical branches. they can pay higher interest rates.” says Ken Paterson. vice president of research operations at Mercator Advisory Group. a research firm based in Maynard. Mass. And the accounts are insured by the Federal Deposit Insurance Corp.. to $250.000. he says.
Harness the Power of Social Networking
Social networking sites can turbocharge savings. especially for teens.
Take MatchFund.com. which lets aero leads parents match their teens’ savings deposits. Teens also can create savings goals like saving for an iPod. And their spending is co-managed with parents via a categorized spending card. which organizes purchases into groups such as music. games and clothing for parents to approve.