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Make it automatic.

Setting up automatic deposits from your paycheck or checking account into your savings account each month may help curb the tendency to spend the money. Most employers allow you to deposit a portion of your paycheck into more than one account. If you can't do that, set up recurring automatic transfers with your financial institution.

Interest

Some savings accounts, such as Money Market accounts and CDs (Certificates of Deposit), pay higher interest than a basic savings account. This is due to higher minimum balances and/or a promise to keep the money in the account for a specified amount of time (as with a CD).

Money Markets are considered "liquid" accounts. These are accounts where you can make withdrawals without incurring any penalty. With a Money Market there is usually a minimum balance requirement that you must maintain to avoid a fee. You also need to keep in mind that Federal regulations generally limit the number of withdrawals to six per month.

CDs also have a minimum balance requirement but these are not liquid accounts. You choose the length of the CD (usually anywhere from 3 months to 5 years) and promise to keep the funds in that account for the duration of the term. Withdrawals made prior to the maturity date are subject to penalties so these accounts are better for those who will not need to access the funds on deposit for the length of the term.

Click here for our savings account guide.