There is a lot of talk about savings today. With the economy looking less than cheerful and the prospect of social security disappearing, Americans are growing more and more concerned with making sure they have money for their golden years. That’s all well and good, but what about your more immediate, short-term goals? What about Christmas next year? That new car you want to buy? That TV you’ve had your eye on? The long term saving plans people set up for their retirement days, unfortunately, tend to leave these little things out. That’s where the mini savings fund comes in.
Traditional, long-term savings funds are wonderful for planning for your future. They generally offer good interest rates, include investments, and generally go untouched for long periods of time. These funds are usually more difficult to withdraw money from than a regular checking account. This is especially true of savings plans that include investments because many investments take time to mature. This doesn’t present a problem when you’re saving for a goal that is several years down the road, but when you want to get your money back out in 6 months or a year, there are often better options.
Mini savings funds fill in the gaps that are left by their more traditional cousins. They tend to be more short-term, often less than two years. They are also highly goal-oriented. Where your average savings plan is aimed mostly at simply saving as much as possible for your future, which is a rather vague goal, mini savings funds are aimed at more specific goals such as buying a new car or other relatively large purchase. These mini savings funds are also generally used up quickly, often in one shot, while their larger counterparts are designed to pay out smaller amounts over a longer period of time.
Mini savings funds have become popular in recent years as the average American consumer has become more aware of how their money moves in the economy. These funds are appealing because they are easy to set up and offer relatively quick satisfaction, which is something we Americans are notorious for craving. They tend to be more flexible than your standard retirement plans, and are easier to understand. In short, they are quick, easy, and convenient – the three things that tend to top the list of priorities for the American consumer.
It’s really no wonder that this style of savings fund has become as popular as it has in the United States. The American Dream is often characterized as driving a fancy car, living in a fancy house, and having all the amenities and luxuries of modern life. While long-term, retirement-based savings funds are wonderfully practical, they offer none of the immediate satisfaction that is the object of desire for most Americans. The key, as with many things in life, is to find a happy balance between the two. Do that, and you’ll be sure to have a happy and prosperous future.