Some may argue that savings accounts are not worth it anymore because of the low interest rates that they give. They would rather put their money elsewhere and have it grow faster. While investments in stocks or bonds might bring about higher yields, there is no doubt that savings accounts have a value in a person's financial future.
Why do you need a savings account?
1) It instills the discipline and habit of saving
2) To have a liquid account to put your emergency fund in
3) It is a convenient place to temporarily put your money while you ponder on your investment decisions
4) This could serve as a link to your checking account since checking accounts have lower interest rates.
5) You can get money from this account to pay bills and utilities
6) To have a place to set aside money for long-term purchases like a car or a vacation
You have to choose a bank where you will open a savings account wisely. Some questions to ask are the following:
1) How much is the minimum balance to open an account? Are there penalties for falling below the minimum balance? How much is the penalty?
2) How much is the interest that you earn from your savings account?
3) Is there a limited number o f transactions that is allowed to do with the account?
4) Can your salary be deposited directly into your savings account? (This has to be facilitated by your employer).
5) Will you be issued an ATM or a debit card? Are there fees for using this?
6) Will there be monthly statements delivered to your house?
Why is it important to have ready cash available?
1) Cash purchases have the advantage of of big discounts that you cannot get with buying on credit.
2) Smaller items like grocery purchases can be paid by cash so you don't make it a habit to use a credit card.
3) With cash payments, you can easily balance how much money you have in your bank.
4) You won't be borrowing if you have money saved up.
Even though savings accounts might not give the sophistication of other financial investments, it is a solid financial tool that will serve as the anchor for other important decisions.It is not a small feat to save money every month and the habit of saving is the foundation for future growth. Give your savings account the importance it deserves and use it wisely.
Why do you need a savings account?
1) It instills the discipline and habit of saving
2) To have a liquid account to put your emergency fund in
3) It is a convenient place to temporarily put your money while you ponder on your investment decisions
4) This could serve as a link to your checking account since checking accounts have lower interest rates.
5) You can get money from this account to pay bills and utilities
6) To have a place to set aside money for long-term purchases like a car or a vacation
You have to choose a bank where you will open a savings account wisely. Some questions to ask are the following:
1) How much is the minimum balance to open an account? Are there penalties for falling below the minimum balance? How much is the penalty?
2) How much is the interest that you earn from your savings account?
3) Is there a limited number o f transactions that is allowed to do with the account?
4) Can your salary be deposited directly into your savings account? (This has to be facilitated by your employer).
5) Will you be issued an ATM or a debit card? Are there fees for using this?
6) Will there be monthly statements delivered to your house?
Why is it important to have ready cash available?
1) Cash purchases have the advantage of of big discounts that you cannot get with buying on credit.
2) Smaller items like grocery purchases can be paid by cash so you don't make it a habit to use a credit card.
3) With cash payments, you can easily balance how much money you have in your bank.
4) You won't be borrowing if you have money saved up.
Even though savings accounts might not give the sophistication of other financial investments, it is a solid financial tool that will serve as the anchor for other important decisions.It is not a small feat to save money every month and the habit of saving is the foundation for future growth. Give your savings account the importance it deserves and use it wisely.
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