Where Should You Save Your Money?

July 5th, 2021 by

Photo by Karolina Grabowska / Pexels

You are finally at a point in your finances where you can begin to save for the dream vacation you have always wanted to go on. 

You have saved quite a nest egg of money and now you are wondering where you should store your money.  

Some things to consider, according to the Consumer Financial Protection Bureau, are: 

  • How secure is your money now at its present location? 
  • Are the costs associated with keeping your money there?
  • How easy can you get to those funds should you have to?  

If you decide to keep your money in a secret place in your home, it can be easily accessible and free; however, it may be less secure in case of a fire or even theft. 

On the other hand, you can place your savings in a financial instruction, which could be less convenient, but those funds would be very secure. 

RelatedHow to Prepare Your Finances for an Emergency

Federal programs such as the Federal Deposit Insurance Corporation (FDIC) and the National Credit Union Administration (NCUA) both guarantee that any deposit up to $250,000 is guaranteed to be accessible to you, in the bank or credit union, even if the bank or credit union fails, those funds will be protected by those agencies.

Considering the benefits and risks of each possible location can help you decide what works best for you and your money.

Financial Institution

The benefit of opening a saving, checking, or share draft account is that it is fully insured for up to $250,000 dollars. 

Your money is safe and can’t get lost or stolen or be burned up in a fire or any other disaster. Generally speaking, you can get the funds back if someone steals the money by electronic means or debit card as well. 

Related: What is the Overdraft Opt-in Choice on your Checking Account?

The risks are that you may be charged service fees if you break one of the conditions of the account, such as going below a certain minimum amount in the account. 

If you have had a history of poor banking, you may find it difficult to open an account right away.

Leave it with a Family Member or Friend

The biggest benefit is that there are no costs to maintain your funds with them. 

You could lose your money in some sort of disaster such as a fire. You could put your family member or friend at risk for a burglary or robbery if word gets around that they are holding on to some money. 

Also, one of the biggest risks is that your friend or family member can betray your trust and take your savings for themselves.


Just like entrusting your funds with a friend or family member, you risk the chances of having your money lost, stolen, or destroyed in a natural disaster. 

You may also place yourself at risk to be robbed or have a burglary in your home. 

The positive would be that there would be no costs to maintaining the funds, you would have easy access to the money 24/7, and it would be convenient.

Use a prepaid Card

Again, this would be quite convenient and you would have easy access to the funds via the card. There would be no need for a bank and/or a credit union account. 

There may be fees associated with the use or maintenance of the card. You may not have the same amount of guarantee should the issuing card institution go out of business.  You should fully understand the fees and review the terms and conditions of a prepaid card, before sinking your money into one.

U.S. Savings Bonds

Even if you have paper bonds and there is a fire or other disaster, your funds can still be recovered. 

Your money cannot be lost or destroyed when you invest in U.S.bonds. You could lose some interest if you cash in the bonds before they mature, such as having an emergency situation come up and you needed the money. 

It also makes it more difficult for you to access your money right away as you will have to cash them in at a financial institution.

Before deciding where to keep your money, ask questions to the financial institutions and do as much research as you can.


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