ByTervel T Kejih

6 Steps to Escape the Trap of Living From Paycheck to Paycheck


One of the most difficult experiences to deal with is the challenge of working and earning pay which runs out before you get the next pay check. Beside the fact that this situation makes it practically impossible to achieve any meaningful financial goals, it also creates an intense level of stress that is difficult to deal with.

While it is easy to throw your hands up in the air in despair and declare that it is impossible to dig yourself out of such a hole, there are practical steps that you can take to not only get a firm handle on your finances but to go on and enjoy financial freedom without winning the lottery. These steps include the following:

  1. Make a Strong Determination to End the Cycle

The first step towards escaping the trap of living from paycheck to paycheck is to make a firm determination that you want to end the cycle. It is this firm determination that will give you the strength to make the needed decisions and changes and stick with them until you achieve your objective. To develop a sense of determination that is strong enough to keep you motivated throughout the journey, you must be very clear within you as to why you are pursuing the goal in the first place. And truthfully, only you can find this reason. Why do you want to end the cycle of living from pay check to pay check? Do you want to end the cycle so that you will have some money set aside to make a down payment on a house? Or is it so that you can start saving for your kids’ college education? Or maybe you are just tired of perpetually lacking money, plain and simple. Whatever your reason, it has to be strong enough to keep you fired up all the way.

  1. Spend Your Money Based on a Budget

One of the major reasons why people live from paycheck to paycheck is because they don’t plan their spending. The way it works for a lot of people is that once they have cashed their paycheck, they spend the money as they go based on the needs and expenses that spring up. Obviously, this is a terrible way to manage money and it can only lead to one end: running out of money before the next pay day!

To avoid this, you should always work with a budget. The budget doesn’t have to be an Excel spread sheet or an advanced budgeting software program like Mint. It could be a simple outline on a piece of paper detailing how the money you earn on your pay day will be spent.

The key is to make sure that all your expenses are built into your budget. Your expenses include fixed expenses such as mortgage or rent and insurance; variable expenses such as groceries and utilities and savings or investment. The budget should also include the date when each of your bills will be due.

When you start the practice of budgeting, you may find that it may take you a while before you get a handle on how much you should allocate to expenses such as groceries, entertainment, and others within the variable expenses category. The most effective way to tackle this challenge is to track your spending by documenting every purchase, whether it is by credit card or cash. Do this for four to eight weeks and you will have a fair idea of where your money goes to and how much you should realistically budget for each expense.

Once you have figured out a realistic budget for each expense, you can set this as a template and use it every pay day with only a bit of tweaking here and there as the situation may demand.

  1. Stick to Your Budget!

It is one thing to create a budget for your expenses but it is entirely another to be able to stick to it. Beyond coming up with a budget for how you will spend your money, you need to develop the discipline to stick to it exactly the way you outline it. Without this discipline, it is easy to fall back into the practice of spending on impulse or spending without monitoring how your money is going out. To help you maintain the discipline of sticking to your budget, you should always make your purchases from a list that is based on the budget you have drawn up. This way, you can easily track the outflow of your money. It will be difficult for you to go off budget and if you notice that you are violating your budget, it will be easier for you to rein yourself back in.

  1. Cut Spending from Your Budget.

If after making a budget and sticking with it, you find that you still don’t have any money left at the end of the month, the next step would be to trim your expenditures. Take a look at your expenditures to be sure that you have not locked yourself into a lifestyle that is draining money from you unnecessarily. Take a hard look at the various categories of your expenses such as housing, transportation, groceries and entertainment and see if you are spending amounts that are outside a reasonable range for your level of income. For instance, if you find that you are spending more than 28% of your monthly gross income on housing, you might want to consider moving into a less expensive apartment or into a less expensive neighborhood.

If you have a luxury car that drains money from you, consider trading it in for a reliable, less expensive model. If you have a gym membership that cost $200 a month, look to see if you can downsize to a less expensive one. And if you are on a cable package that cost $150 a month, ask yourself if you really need it. If not, consider going for a package that costs less but will still allow you access to the important channels that will meet your needs. And if you have always relied on takeouts for your meal, you can save a whole lot if you cook your meals at home.

5. Stop Using Your Credit Cards

If you are living from paycheck to paycheck, chances are that you have credit card debt. To help you get your finances together, you need to avoid piling up more debt by suspending the use of your credit cards until you have paid off your debt.

Since paying your debt take a sizeable part of your income, getting out of debt will go a long way in helping you escape living from paycheck to paycheck.

If you build all your expenses into a budget and also include in the budget an amount you will set aside to cover emergency expenses, you will find that suspending the use of your credit cards wouldn’t be the end of the world. Even if a catastrophe strikes, you will dip into your emergency savings instead of relying on your credit cards to cover the emergency.

  1. Look for Ways to Increase Your Income

Another way to end the cycle of living from paycheck to paycheck is to bring home more money. Understandably, this can be easier said than done but it’s not entirely impossible. There are actually a number of options you can explore to generate additional income. If you have time to spare, you can take up a second job. Granted, your second job may not bring in so much money but it could help you generate additional income to pay off your debt or start saving up an emergency fund.

If you cannot take up a second job, consider offering your skills as a freelancer on online workplaces such as Upwork and Guru. And if you have any items in your closet that you no longer have any need of, bring them out and sell them off at eBay or Craigslist.

ByTervel T Kejih

Developing a Strong Marketing Message for Your Business

It has been my experience that many business owners are confused about what a marketing message is. As I talk with entrepreneurs, I have found that many people think that a marketing message is the same as a company slogan or tagline; others believe that their marketing message is their mission and vision statement yet others think that their marketing message entails a description of what they do.

Actually, a marketing message is none of what I have just listed above. While all of these communicate something or the other about your business, a marketing message goes beyond just talking about your business. A marketing message talks about what you do for your customer….how you solve their problems.

Your marketing message, whether it is contained in a brochure, an ‘‘about us’’ page, an advert, a newsletter or a proposal, should be aimed at communicating to your target customers that you know what their problem is and you have a product or service that will solve the problem. Your marketing message is what tells your target customers why they ought to choose you and not your competition.

5 Critical Components You Should Take into Account When Crafting Your Marketing Message

For your marketing message to be strong enough to resonate with your target market and draw them to patronize your business, there are at least five critical components that you must take into account when crafting your message. These five components include the following:

Ensure that All the Elements of Your Message Align With Your Target Market

If you are going to run a successful business, you must know whom you target customers are. Once you have clearly identified the section of people you are looking to reach with your service or product, you can then craft a message that will resonate with this group of people so that when they read your marketing message, they feel a connection with your offering.

Firstly, craft your marketing message in a language that your target customers use regularly. Craft the message in a language that when your target audience read it, it makes them nod their heads and say ‘‘wow, that sounds like something I would be interested in’’ By using a language that your target customers use regularly, the message will get through to them quickly. They will not struggle to make sense of what is being said.

In addition to the language of your message, see to it that all other elements of the message match up with your target customers. If you plan to use pictures in the message, it is important that the pictures are such as your readers will not find them offensive. And if you intend to print the message, the material you use and the quality of the printing should be of a level that will be welcome by your specific target group.

If you have not clearly defined your target market, then this would be the time to do so. Because without a clear understanding of who you are targeting with your product or service, your marketing message will be too diffused to stand out or make a strong impression on any segment of people.

Highlight the Challenges Your Target Market Experience

One of the ways to convince a person that you can solve their problem, that you have a solution to their need is to show that you understand what they are going through in the first place. The best way to show that you understand what they are going through is to accurately articulate the challenges that they face as well as the feelings – fear, worry, frustration, pain and others – that they experience as a result.

This is why your marketing message must clearly articulate the challenges that your target customers encounter in their lives for which you are offering a solution. By highlighting the problems and pains that your target prospects have, they will quickly see your business as ally in solving their problem and not as a business that is looking to sell them a product or a service. This perspective will make them very willing and eager to buy from you.

State the Solutions Your Product or Service Brings to the Challenges Your Target Market Experience

Okay, so you clearly articulate the challenges your target customers have as well as the feelings that accompany those problems but do you have the solutions to these frustrations?

Once, you have identified the problems that distress your prospects, you must go on to show them that your product or service will offer them exactly the solution they need. It is your responsibility to find a way to highlight the ways in which your product or service will relieve or completely eliminate those difficulties for your prospects. You must make them see clearly from your marketing message that your product or service will sufficiently meet the need that they have. The key is to make them see how much better their lives will be by using your product or patronizing your service

Include Testimonies of Positive Results Others Have Achieved Through Your Product or Service

If your product service has produced results for others before, then don’t hesitate to use the testimonials of such people to back up your claim. Your prospects may not readily believe you despite your best argument to prove to them that your product or service is just what they need but their stance will significantly soften if you show them that people like them have used your product or service to great effect.

With such testimonials, it is no longer just you talking about the positive results that your product or service generate but people who have patronized you in the past bearing testimony to the positive results they have achieved through your product or service. A testimonial from a satisfied client is a difficult thing to argue with.

Highlight your specific expertise, proprietary process or superiority of product or service.

Until your prospects find at least one thing about your business that is unique, they will rate your business no differently than others. And if they rate your business the same as others, it means they will not be particularly insistent on always buying from you. This means that in your marketing message, you should strive to highlight those things that make your business unique and different. It could be a specific expertise which only your company possesses or a proprietary process you employ in your business which is unique to you. If none of these apply to you, then maybe you can make some minor tweaks to an existing product and present it as a fresh one and make it the center of your message.

Ultimately, this point is about communicating the unique differences of your business that will have perceived value to your prospects. It is the perceived value they see in your unique differences that will motivate them to patronize your business and stick with you henceforth.




ByTervel T Kejih

Guide to Buying Car Insurance for the First Time






In most states across the country, buying car insurance is a mandatory requirement for driving. But buying car insurance for the first time can be tricky and stressful because there is a lot of details you will need to grasp in order to make the right decision. These details are simplified here in order to help you buy the car insurance coverage that is right for you.

Types of Coverage

Each state determines and regulates the types of car insurance residents must buy to be eligible to drive. However, generally, the following types of insurance coverage are the most frequently needed:

  • Liability
  • Collision insurance
  • Comprehensive coverage
  • Uninsured/Underinsured motorist insurance
  • Personal injury protection

1) Liability Insurance

In many states, a mandatory minimum insurance coverage required for driving is liability insurance. There are two types of liability coverage, namely:

(i) Bodily injury liability – This coverage protection from claims made against you as a result of injuries suffered by one or multiple people in accidents in which you are at fault. Usually, there are separate types of bodily injury liability, one for if a single person is injured and the other for if many people are injured.

(ii) Property damage liability – This coverage makes provision for damage your car might cause on other people’s property. Liability insurance does not provide coverage for damages caused to your own car.

In many states, these insurance coverages are represented by three numbers. For instance, in California, these numbers are frequently represented as 15/30/5. This means that the coverage required by law for the state of california is $15,000 for bodily injury of one person, $30,000 for bodily injury of more than one person and a $5,000 insurance cover for property damage.

2) Collision and Comprehensive Insurance Coverges – This insurance provides coverage for damages caused to your car in the event of collision with objects or other vehicles. Comprehensive Insurance provides protection for your vehicle against non-collision types of damages such as theft, vandalism, weather conditions, natural disasters and others.

3) Uninsured/Underinsured Motorist Insurance – This insurance cover is required in a few states and it is designed to provide protection for you in the event you sustain injury in an accident with a vehicle whose driver does not have any insurance coverage or one whose coverage is not high enough to cover the damages you sustain. States that demand this insurance coverage do so to protect motorists with the understanding that despite the state laws requiring minimal liability coverage, there might be some drivers who may not meet these requirements.

4) Personal Injury Protection (PIP) – This is an insurance coverage that covers the cost of your medical expenses resulting from an accident in which you are involved irrespective of whether you are at fault or the other driver is. With this insurance coverage, you can pay for your medical bills without having to wait for the conclusion of a lengthy investigation of the accident meant to determine who was at fault. In addition to medical bills, PIP insurance also pay for lost wages that you may incur as a result of an accident.

Factors That Determine the Cost of Car Insurance

People pay different amounts for car insurance. This is no haphazard occurrence. Insurance companies take into a number of factors that help them gauge risk to determine how much you pay for your car insurance. Some of these factors include the following:

Your deductibles – If you choose a higher deductible, you will make lower monthly payment. Conversely, if you choose a lower deductible, you will have to make higher monthly insurance payment.

How many miles per year you drive – If you drive long distances and cover a lot of miles, you are likely to pay more on insurance than someone who drives less.

Where you live or your neighborhood – If you live in a neighborhood that is susceptible to vandalism, theft and collision, you will most likely pay more in car insurance than someone who lives in a neighborhood where such incidents are less or non-existent.

Your age and gender – Young people under the age of 25 are more likely to crash their vehicles. Of this group, males statiscally tend to have more accidents than females. For older people, males have better rates than women. These differences are taken into by insurance companies when determining premium.

The safety rating of the car you drive – Based on vehicle safety ratings that insurance companies have developed, they offer discount to folks who drive cars that are rated as safer vehicles.

Your credit history – Generally, having a good credit history with high credit score means that you will lower insurance premium.

Your driving history – If you have a history of frequent car crashes, you will pay more in insurance premium than if you had been crash-free for several years.

Ways to Lower Car Insurance Costs

There are some definite steps you can take to lower your car insurance cost. Most insurance companies will be willing to give you discount or lower the cost of premium for you if you meet certain expectations and thus, reduce the risk that comes with insuring your vehicle. Below are a few ways you can do this

Choose the Right Car – If you choose a large car, you will enjoy the benefit of a car with top-notch safety fittings which will give you good safety ratings. With good safety ratings, you will have lower insurance premium than if you had got a smaller car that lacks such safety fittings. However, most large cars have large engines relative to body size and usually have higher premium than a small car with a small engine. Moreover, large cars are usually more expensive to repair when they are involved in an accident. Your best bet therefore, is to go with an older car with a small engine. A car that has gone a few miles and do not cost the earth to purchase.

Upgrade your car security – Whatever you can do to reduce the chances of your vehicle being stolen, vandalized or damaged will significantly increases the security of the vehicle and thus, lower your insurance premium. You should consider fitting your car with an alarm, engine immobilizer or a tracker to add security to it.

Reduce the distance you cover with your car – You can do this by joining a car or van pool or taking public transportation to work and back especially if you are in a line of work, such as being a delivery or a journalist that require you being on the road constantly. By reducing your total annual driving mileage you may be abk to lower your insurance premium.

Improve your driving record – If you have a history of crash-driving, endeavor to clean this up by maintaining a clean driving record. If you maintain a clean driving record long enough, the effect of past crashes will wane and your premium will be lowered.

Maintain a good credit history – By maintaining a good credit history and score, you give yourself a good basis for asking for lower premium on your car insurance.

Take advantage of opportunities for discount – There are instances when you might qualify for a discount that will lower your insurance premium cost. For instance, you could qualify for a discount if you are getting coverage for a newer vehicle or are being added to a policy that has multiple vehicles. If you are a young person still living with your parents, you should consider being added to their insurance policy as this will give you an appreciable discount on your premium. And when the time come when you want to move to your own policy, set it up before removing yourself from your parent’s policy. This way, you will enjoy the discount that comes with maintaining continuous coverage. Furthermore, if you are a student or a teenager, you can increase your chances of getting a discount if you complete Driver’s Education and maintain good grades in school.

Consider increasing your deductible for a lower monthly premium – You might want to consider going with a higher deductible in order to lower the amount you will pay as monthly premium. However, you should be careful with this strategy so that you don’t raise your deductible so high you struggle to come up with the money you need to make claim if and when the need arises.

Tips on What to Do When Buying Car Insurance for the First Time

In seeking to buy car insurance, you should understand that there is no one size fit all policy. Different people buy different insurance policy depending on their unique needs and situations. However, there are a few tips that could help you as you make a decision on car insurance policy to ensure that you get the right insurance coverage and a good deal. These tips include the following:

Determine What Coverage is Necessary – It is vital that you get enough insurance coverage but it is also important that you avoid getting more than you need. At the minimum, you will need the state required liability insurance requirement for driving. However, for many state, the required minimum liability coverage is not enough to pay for serious injuries or replace newer cars. Therefore, you may have to buy additional liability insurance to guarantee that you are fully covered in the event you get involved in an accident in which you are at fault. This is important especially if you have a home or savings which might become a target of lawsuit in the event of a lawsuit. In addition, you should get comprehensive and collision insurance coverage if you owe money on your car or if you could not easily replace it. However, if your vehicle is old, the minimum liability insurance requirement may be enough for you.

Research Car Insurance Companies – If you elect to contact an insurance company on your own, it is vital that you do some research on the company you are looking to sign up with. This research will give you insight that will help you determine if you should go with an insurance company you are considering – or one that your agent has suggested – or if you should look for another one. Some of the ways you can research a company include doing the following:

-Check the company’s rating on the Better Business Bureau (BBB)

-Check with your state’s Department of Insurance for customer complaint ratios

-Talk to your family members or friends who have car coverage from the company. Find out what their experience with the company has been.

-Check the company’s social media accounts to see what comments customers leave there.

-Call the company’s office and gauge their responses and reactions to your questions. Is the response warm? Did they answer your questions in detail or their answers were cursory? What do you make of the quality of customer service?

-If you can, find out about the financial standing of the company. You can use the services of J D Power and A M Best for this purpose.

Choose a Deductible You Can Easily Pay – Your Insurance deductible is the amount of money you pledge to pay before the insurance company will pay your claim. The higher your deductible, the lower your monthly premium will be. A lower deductible means that you will pay more on premium. Paying higher deductible in order to lower your premium may seem like a great idea but it will definitely not look that way if you get involved in an accident and the insurance company refuses to pay your claim because you are not able to the high deductible. On the other hand, if you lower your deductible excessively, you have a tough time regularly paying your monthly. Therefore, the key is to strike a balance between what you can conveniently pay as deductible in the event of an accident and what you can conveniently pay as monthly premium.

Utilize an Independent Insurance Agency – While it is okay if you decide to go out on your own to buy car insurance, there is a great advantage in utilizing an independent insurance agency that can shop multiple insurance providers to find the best combination of coverage to meet your need at a cost that you can afford. More so, using an independent insurance agency will help you better navigate your way if you have a tricky driving record.

Inform Insurance Agency of Security Features – If your car has top-notch security features such as anti-lock brakes, on-board GPS tracking system and etched VIN number, you should mention this fact to the insurance agency if they do not ask. The presence of these features will go a long way in lowering your insurance rates because they make more difficult for your car to be stolen and easier for it to be recovered if it gets stolen.

Ask to Bundle – Bundling your insurance policies means that you buy your car insurance from the same insurance provider that insures your home, boat and other possessions. By so doing, you get rewarded for your loyal patronage with discounts on your auto policy. If your insurance provider has provision for bundling, look to take advantage of it.



ByTervel T Kejih

5 Ways Effective Networking Will Help You as an Entrepreneur

By Tervel T Kejih

According to Richard Branson, founder of Virgin Group, “Succeeding in business is all about making connections; it is all about personal contact’’. Understandably, there are other factors involved in succeeding in business but if you tick the box on all other factors but fail to make the grades where networking and building connections with other people is concerned, you will most likely not make it into the box office of business success.

When it comes to your business, it is vital that you know your stuff. But a lot of times, it is not just about what you know but who you know. Many times, knowing the right people has turned out to be the difference between success and failure in business.

This is why networking effectively so to enlarge the pool of people that you have connection with is vital for you as an entrepreneur. The larger your network, the higher your chances of achieving your business goals. The more people you know and have connection with, the more opportunities you will come across as an entrepreneur.

The following points highlight how effective networking will help you in your journey as an entrepreneur:

It Will Help You Generate New Business 

I am guessing that constantly generating new business is one of your core objective as an entrepreneur. This is why you should be joining networking groups and participating in their activities.

When you join groups, you get to know people and what line of business they are into. They in turn, get to know you and your line of business. Subsequently, you get referrals coming to you when the people you know in your networking group recommends your business to their friends and relations.

The great news is that the referrals that you get through your network of contacts are usually easiest to convert into clients because they come pre-qualified. In these instances, the referral would have been more than half-way sold on your service or product by your contact who referred them. You can then easily follow up the individuals and turn them into clients, thus generating increased business.

 It Opens the Doors for You to Influential People

Networking opens the door for you to meet and talk to really influential people that you wouldn’t otherwise be able easily meet or talk to.

By belonging to business groups to which some influential business people also belong, you get the opportunity to meet with, talk to and actually build a relationship with such influential people at the meetings of these business groups. Knowing that in business, it is not always about what you know but who you know, having relationships with influential people whom you can call upon when you need them can be a huge leverage for you as an entrepreneur.

In addition, it is not just about who you are networking with directly. Whoever you network with has a network of their own which you can tap into if the need arises. There may be occasions when the person you have built a connection with may not be in the position to help you with what you need but they may have someone in their own network who fit the bill of the kind of person you need. So as you network and build connections with people, do remember that you do not only stand to benefit directly from the influential people you network with but also from their own network.

It Gives You the Opportunity to Get Advice from Like-Minded Business Owners

No one knows it all and that includes you. So having a network that constitutes of like-minded and successful entrepreneurs from whom you could learn a thing or two could be real beneficial to you. Especially if you are someone just starting out, there is so much that you do not know. Networking with the right sort of people will help you learn all you need to.

A note of caution though. You should be networking with and seeking advice from the right sort of business owners – Folks who are successful in their businesses so that you can be sure that they know what they are talking about. You should not bother with people who give opinions based on assumptions and not what they have proven by experience in their businesses.

Another thing, being an entrepreneur is challenging and the journey can be lonely on occasions, particularly when you are faced with a dilemma that you have never dealt with previously and you are at a lost how to proceed. At such times, having a like-minded entrepreneurs who has probably dealt with and overcome a similar situation, to whom you could turn for counsel might just be what will save the day for you.

 It Will Raise Your Profile and That of Your Business

By networking and connecting with influential business people, you will raise your profile and that of your business in a way that not many activities will do. First off, by being noticed with success and influential business people will affect the way many people see you and your business. In the eyes of many people, you will be seen as a knowledgeable and competent business person and your business as a reliable one that delivers results for its customers. So as you network and develop relationships with influential business people, look to attend social events where you will be seen with them. And if your business organize any event that you think you can get them to attend, by all means do it. Their presence at your business event will serve as a huge endorsement which will raise your reputation in no small measure.

It Will Boost Your Self-Confidence

One of the magic of developing self-confidence is doing that about which you usually have goose pimples and succeeding at it! The more you successfully push yourself to network by walking up and talking to people you are not acquainted with, the more your confidence will increase. As you become more confident, the easier it will be for you to strike up conversation with people you don’t know and ultimately build connections with them. This is very important for you as an entrepreneur because the growth and success of your business is dependent, to a large extent on you talking to people and making connections with them.




ByTervel T Kejih

Investing In a High-Yield Savings Account: What You Should Consider

One of the important ways of taking charge of your finances is having some money set aside as savings. Having some savings enables you to put aside money for a down payment on a car or a home or to handle an emergency without been thrown off balance financially. It also empowers you to explore options that were previously not accessible to you to grow your money.

One of such options is a high-yield savings account. A high-yield savings account is a great instrument in helping any person build up money. It provides a way to save money and make money in the process. As opposed to a standard savings account, a high-yield savings account yields a much higher interest rate and therefore, a higher return on the money you save. By putting your money in a high-yield savings account, you create an opportunity for your money to generate more money for you through the interest that will accrue.

By deciding to open a high-yield savings account, you will be embracing the amazing opportunity of saving your money and growing it at the same time using a secured instrument, given that high-yield savings accounts are insured by the FDIC up to $250, 000 per account. This way, you will never have to worry about loss so long as you stay within the FDIC insurance limit.

While opening a high-yield savings account clearly offers a great advantage, there are factors you should consider before you decide on the bank with which you will open your account. These factors include the following:

Account Opening and Maintenance Fees

This is one of the first things you should confirm. Does the bank charge an account opening fee? How much? Would you need to pay an on-going monthly or quarterly or yearly fee on the account? While a number of banks may charge a standard fee for setting up the account, some will waive the fee for you if you are able to maintain a minimum balance. Before you proceed to open the account, look critically into this to be sure there are no hidden charges that are not apparent at the time of opening of the account but which will show up down the road to take money from you.

Deposit Requirements

Find out if the bank require a specific minimum amount as initial deposit for opening the account or if you can open it with whatever amount you have on hand. Check to see if you can meet the requirement before proceeding with opening the account.

Transaction Numbers

Typically, there will be a limit on the number of transactions you can make on your account per month. Most banks limit number of deposits you can make or the number of times you can withdraw money from the account in a month to 6 times. Furthermore, find out if there is a limit placed on the amount of money you can put into the account or if you are at liberty to put in as much as you can. For banks that have these rules in place, being able to adhere to them sometimes mean that you are given a waiver on some fees.

Rate of Interest

You are setting up this account because you expect that it will offer you an interest rate that is more than what obtains in a standard savings account. So find out the rate the bank will pay you when you save your money with them. However, in calculating how much interest you will be paid by the bank, do remember that even if the rate a bank offers is not so great, it might still be a good deal if they offer you a smaller minimum amount required for setting up the account, lower fees, more transactions and a no-limit on the amount of money you can deposit into the account per month. The key here to look at your unique needs, do some little math with the figures and then make a decision.

Minimum Balance Required

Usually, a bank would require you to maintain a minimum balance to earn the promised interest rate or enjoy a waiver on account maintenance fees. Find out what this amount is for each bank so that you can compare and determine which bank offer you the best deal.

Links to Other Bank and/or Brokerage Accounts

Ideally, the bank should have provision that allows you link the funds you have in your high-yield savings account with the funds you have in your other accounts with this bank or other banks as well as your brokerage account so that you can easily move money into and out of the account easily. If this provision does not exist, find out what other options there are.

Required Additional Accounts

Some banks would insist that you be a holder of some other accounts, such as checking account with them in order for you to open a high-yield savings account. If you do not have an existing account with them, you will need to open additional accounts after setting up a high-yield savings account. Whatever the stipulations are, consider them carefully and make a decision based on what will work for you.

How You Will Make Deposits and Withdrawal

If you are looking to patronize a brick and mortar bank, this may not be much of a concern to you but if you are looking to open your account with an online bank, you should find out exactly the channels you will have to make deposits. Will you be making deposits through online transfer, ATM transfer or by mailing checks? Will you be able to use another bank’s ATM to make deposits? Also find out if you can set up your account such that a designated amount is deposited into it directly from your pay check or your employer’s account. Furthermore, find out the options you have for withdrawing from the account. Can you issue check against the account? Would you be able to transfer funds out of the account electronically? Can you access the funds with an ATM card using other banks’ ATM network? How much would you be charged for each transfer? Make sure all your questions regarding deposits and withdrawal are answered explicitly.









Finance | Business