Savings Account vs. Vacation Account
A savings account is the most popular type of account available. Today, almost every person owns a savings account but very few have vacation accounts. It allows you to store your finances securely with a credit union or an insured bank. The money stored in savings accounts is less accessible compared to the monies stored in the checking account where you are always able to withdraw without restrictions. The number of withdrawals is limited by the Federal Reserve to six in a month. However, this does not include withdrawal of cash from the ATM or the teller. There is always a fee charged when there are several transactions from the savings account by computer, check or automatic debit.
No doubt you want to enjoy your vacation to the fullest. Why worry about money? However, when you simply save money, dollar for dollar, you’re working for your vacation to ensure it is a success. Whereas, when you invest your money, your money will in turn work for you. Let’s say you forego saving $1000 for a small trip and instead invest a total of $20,000 and earn a 10% plus a free trip annually. After all, you still keep your $20,000. $20K by 10 is $2000. All you have to do is add $1000 more and take a vacation to Europe!
One benefit of having a vacation account in place is that you’re not tempted to dip into it throughout the year like you would be with a regular savings or checking account. Check with the guidelines of your particular bank or credit union. Many vacation accounts compound interest daily, pay out monthly, yet with no monthly fee. You may even be able to earn an annual interest bonus when you qualify for monthly automated transfers from your checking account. It’s a good idea to look over your monthly budget and see where you can trim the fat. Cutting out that extra dinner with the girls or the latte every morning can mean extra money for your vacation fund.
Most banks today offer the vacation accounts as fixed period accounts, meaning you would decide on a goal and set a date for when you’ll have a desired amount of money in the account. Your bank may work with you to help you come up with a relevant weekly or monthly contribution.
Keep in mind, securities attorney such as Thomas Law Group can give you advice on how to acquire more money by checking your portfolio for errors. There are many ways to invest in stock so that you can profit for a vacation. A vacation fund is a great way to augment your stock portfolio. To make it even easier to save, set up a monthly or weekly automatic transfer into this dedicated account; after all, the more money you sock away, the more interest you’ll accrue. You’ll be sipping a margarita on the beach in no time!