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Preserving Your Savings While Optimizing Cash Flow

With excellent credit, you may qualify for the full range of credit options with lower rates. This can help you achieve your short- and long-term financial goals without having to deplete your cash reserves, disturb your savings, or interrupt cash flow.

Know your options

Having access to a wide range of credit options can also give you more control over your finances ― allowing you to use credit strategically when and how you choose. For example, instead of tapping into your savings, you could fund a large expense like a home improvement project in a variety of ways.

Funding Options Features
Considerations
Home Equity Line of Credit

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  • Interest you pay may be tax deductible
  • There’s just one payment to make each month
  • Your home is used as collateral. If payments are not made, you could lose your home.
  • A home equity line of credit has a variable rate; your monthly payment may increase if your rate or remaining account balance increases.
Secured Line of Credit

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  • Lower interest rate and monthly payments compared to an unsecured account
  • Leverage your savings while still earning interest
  • $25 annual fee required.
  • Your Wells Fargo savings or CD is used as collateral. If payments are not made, you could lose your deposit account collateral.
Personal Line of Credit

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  • No cash advance or balance transfer fees
  • Quick credit decision and access to funds in as little as 1 business day
  • $25 annual fee required.
  • Wells Fargo also provides many other products available for you to consider.
  • Interest rate is variable and can rise.
Rewards-Based Credit Cards

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  • Earn 1 rewards point for virtually every $1 you spend in net. purchases
  • Ability to make payments over time or pay in full
  • No collateral required.
  • Payments may be low, but this means it will take you longer to pay off your balance if you only make minimum monthly payments.

When comparing your product options, you should always carefully consider the full credit costs of each product before opening a new credit or loan account. For more home improvement funding options, visit our Home Improvement Lending Center.

Potential tax advantages

Using credit instead of cash or savings can also give you potential tax advantages. The Internal Revenue Service (IRS) generally allows deductions for interest paid on:

  • Mortgages for primary residences and second homes
  • Home equity lines of credit
  • Student loans

 Need Help? 

Speak with your tax advisor and financial planner about how you can make your credit work harder for you in your overall financial and tax planning.