You will probably earn only a small amount of interest on savings. But the purpose of having savings is to keep the funds completely safe and accessible. Money you need to spend in the short-term for planned purchases and emergencies should be kept in a federally-insured savings account, so you can’t lose it.

There are three basic types of savings accounts you can open at most banks and credit unions: a savings account, a money market account, and a certificate of deposit. Review Part 1 of this handbook for an explanation of these accounts and the protection offered by the Federal Deposit Insurance Corporation, or FDIC.