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It’s a good feeling to hit the “thousand” range in a bank account. For Americans, those under age 35 have a median amount of $1,200.*
So if you’re in that range or higher, that’s great, but it doesn’t mean the money has to sit there. Especially when interest rates are so low in a checking account compared to an online savings account. Nor do you have to resort to boring tactics to earn more money on your money either.
To help give you some ideas, we’ve compiled a list of our favorite money moves. There’s a wide variety that you can utilize to maximize the money you have in your account(s)!
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2. Juggling Too Many Credit Cards? This App Keeps it Simple
Having multiple credit cards can be great for earning points and rewards, but juggling different due dates can be a hassle.
And if you carry a balance on your cards, then keeping track of interest rates and payments is even more of a headache. Missed payments can lead to late fees, and automated payments could lead to overdraft fees if you don’t have enough in your checking account.
This is where Tally can step in and help people who have a minimum FICO score of 660. Tally is a credit card and debt management app that keeps track of all your credit cards in one spot. You scan your cards, and Tally analyzes all the balances and APRs to make sure you never miss a payment.
If you qualify for Tally’s line of credit, this means a lower APR for you and could save you thousands on credit card interest. Tally users have an average lifetime savings of $5,300!*
You can let Tally make the multiple payments for you, and you pay back Tally once a month. Or you can set it so that Tally reminds you to pay your cards every month.
Either way, Tally makes sure you’re never charged a late fee again, and you get extra help in paying down credit card debt. Tally’s smart system determines which cards to pay first, based on the APR, balances and due dates of each credit card you add to the app.
Tally is free to download. It’s currently available in AZ, AK, CA, CO, CT, DC, FL, GA, ID, IL, IA, LA, MD, MA, MI, MN, MO, NJ, NM, NY, OH, OK, OR, PA, SC, SD, TN, TX, UT, WA, and WI.
3. Protect Your Income When You’re Too Sick to Work
The coronavirus pandemic has added a great deal of uncertainty to everyday life. One way to financially prepare for the unexpected is to protect your income from serious illnesses.
The best time to prepare is when you’re healthy. Yes, you’re taking the precautions and practicing social distancing. But what happens when your state decides to re-open and life resumes? There are still chances to get sick as there’s no vaccine currently. Plus, those who recover from COVID-19 may be at a greater risk for long-term health issues.
That’s why disability insurance is recommended. You need it if you rely on your source of income to live life. This is especially true if you have loved ones who financially depend on you.
Disability insurance isn’t just for injuries. In fact, illnesses (including mental health issues, such as depression) represent 90%* of long-term disability claims.
To make coverage more accessible and affordable, Breeze has built the first fully online disability insurance product. Answer some quick questions to get a rate in a matter of seconds. You can then choose your benefit period (most disabilities average 2 years) and complete a 15-minute online application.
If you’re approved for coverage, you’ll receive disability insurance benefits paid if you can’t work to make up for lost income. Plans start at $9/month* and benefit amounts range from $500 to $20,000.
It’s free to check out rates and you can apply online. Give yourself peace of mind, especially in these troubling times!
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A common rule of thumb for how much to keep in checking is one to two months' worth of expenses. If your monthly expenses are $4,000, for instance, you'd want to keep $8,000 in checking. Keeping one to two months' of expenses in checking can help you to stay ahead of monthly bills.
20% should be used for fulfilling your financial goals which will include investments and paying off your debt and the remaining 30% should be set aside for flexible spending. There is absolutely no need to spend all the 30%. If you're able to save it, you will slowly move towards a steadier future.
The general rule of thumb is to try to have one or two months' of living expenses in it at all times. Some experts recommend adding 30 percent to this number as an extra cushion.
Ideally, the amount put into your checking account each month should cover what it takes to live comfortably. How is this determined? To start, look at the monthly budget. Add up all of your monthly expenses required to live each month.
Living on a budget of $1,200 is doable but a bit difficult. It would depend on where you live (touristy beach areas tend to be more expensive overall), how much your rent is, and what your lifestyle is. If you shop and eat out like a local, you can live cheaply.
$1,200 monthly is how much per day? If you make $1,200 per month, your Daily salary would be $55.38. This result is obtained by multiplying your base salary by the amount of hours, week, and months you work in a year, assuming you work 40 hours a week.
What is 1200 a week annually? Earning $1,200 a week is the equivalent of earning $62,400 a year. If the person was working 37.5 hours a week, the hourly wage would be $32.
“We would recommend between $100 to $300 of cash in your wallet, but also having a reserve of $1,000 or so in a safe at home,” Anderson says. Depending on your spending habits, a couple hundred dollars may be more than enough for your daily expenses or not enough.
What about the checking accounts of millionaires? Things can get pretty complicated and personal here. “Millionaires' checking accounts are all over the place,” Thompson said. “Some clients will only keep enough to pay for immediate expenses (e.g., $10,000) and others will have $150,000 in checking on any given day.”
Someone who has $1 million in liquid assets, for instance, is usually considered to be a high net worth (HNW) individual. You might need $5 million to $10 million to qualify as having a very high net worth while it may take $30 million or more to be considered ultra-high net worth.
About 29% of respondents have between $501 and $5,000 in their savings accounts, while the remaining 21% of Americans have $5,001 or more. Few hold much cash in their checking accounts as well. Of those surveyed, 60% report having $500 or less in their checking accounts, while only about 12% have $2,001 or more.
There is no specific limit or threshold that would cause the IRS to tax it. That being said, ant cash deposits of $10,000 or more would be reported by the bank in a Currency Transaction Report (CTR) to FinCEN, an arm of the Treasury Department.
American households, on average, have $41,600 in savings, according to data last collected by the Federal Reserve in 2019. The median balance for American households is $5,300, according to the same data. The reality is that the above stats may not accurately reflect the financial situation of many Americans.
There's no one correct answer, but it's usually best to start with at least two accounts—a checking account and a savings account. This gives you an everyday banking account for bills and other expenses and another for saving.
Financial experts typically recommend saving up three to six months' worth of necessary expenses in order to have a healthy, fully-funded emergency account. So, there's no specific number that a person in their twenties needs to have in their emergency fund — it should be based on their necessary monthly expenses.
As a general rule of thumb, you'll want to have saved three to eight times your annual salary, depending on your age: 40: At least three times your salary. 45: Around four times your salary. 50: Six times your salary.
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Disclosure: We’re letting you know that this post contains sponsored links which The Smart Wallet receives compensation for, which may impact their order of appearance. This site doesn’t include all available offers.
