Ask about a NOW account, which pays you interest without monthly fees and minimum balance requirements. But instead of sending it right away, hang onto it, then mail it five days before it s due. In the meantime, your money accrues interest in the account. Think of it as a holding tank for your money, a step up from the checking account. You can get one in which the interest is compounded daily and paid monthly.
Money market accounts.
Well, you can still withdraw cash and write checks, but your access will be limited to, say, six withdrawals per month. And you generally can t write the checks for small amounts, either. So a check written against your MMA is more appropriate for the big expenses. When you think of these basic investments as ways to store your money, it s easy to see how you can use one to build funds up until you re ready to move them to a better one. The longer you lock up that CD, the better interest rate it will pay.