A “savings club” is a type of savings account set up by a group of people, usually for a specific purpose. If this sounds like another term for a joint savings account, it’s not. Well, it kind of is, but savings clubs operate a little differently than a normal savings account.
For one, like we mentioned, they’re usually set up for a specific purpose. And two, they usually come with a lot more rules and regs than standard savings accounts. For example, there might be rules about when deposits are due and who makes them. There might also be rules about when money can be withdrawn, how much can be taken out, and by whom. And three, they often pay a higher interest rate than normal savings accounts (which are paying, what, like .000001% interest right now, so that’s not hard to beat) because of all the restrictions.
The most common type of savings club is probably the Christmas club, but they’re not the only savings club game in town. Let’s say we’ve got four roommates sharing a house in Phoenix, Arizona. Phoenix gets crazy hot in the summer, which means utility bills can easily exceed $500 a month in June, July, and August, when they’ve got the central air running pretty much 24/7. Compare this to the $25 utility bills they usually get in the winter, and we can see where those summer electric bills could cause quite the headache.
Now let’s say our roommates open a savings club account: every month, they each put $30 into the account. The funds can be withdrawn three times a year—once in June, once in July, and once in August—and their whole purpose is to make sure they can afford those pricey summer bills.
Depending on the bank and the type of savings club we’re talking about, the rules—and the availability—of these kinds of accounts can vary quite a bit. So if a savings club sounds like it could be the answer to a problem our squad is facing, it might be worth a Google to see if it’s the right option for us.
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Finance: What is a Savings Bond?2 Views
finance a la Shmoop what is a savings bond well it's kind of like charity
charity because interest rates on savings bonds are exceptionally low even
by government standards well there was an era in America when taxpayers happily
and willingly loaned money to Uncle Sam and were happy to do so because they had
great faith and trust that the people we elected were in fact decent honest [old government photos]
hard-working representatives who had the interests of the nation placed far ahead
of their own personal gain it was the era of Jimmy Stewart and a whole bunch [photo of Jimmy Stewart]
of others you should think the greatest generation yeah we know even a pretty [picture of John Wayne]
good generation check Congress for details so savings bonds used to be a
standard birthday present for young people kind of like the cross pin that [kid's birthday party]
nice Jewish boys would get at their bar mitzvahs grandmother's after slathering [boy's mar mitzvah]
in a bathtub of angry perfume loved handing the $50 savings bond envelope to [woman in hot bath]
their college-bound progeny well savings bonds are issued by the US
Treasury and have no stated maturity date instead what happens is that the
savings bond welljust pays the interest for some
period of time like say a decade and at the end of that 10 years while it simply
stops paying interest you can cash in the bond at that time or just let it
ride essentially renting money to the Gov for free and yeah you don't want to
confuse a savings bond with this bond yeah who needs no safety
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