Some may argue that savings accounts are not worth it anymore because of the low interest rates that they give. They would rather have their money elsewhere and see 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) For the discipline and habit of saving that it instills
2) To have an emergency fund that is more liquid than other forms of investments or accounts
3) To have a place to park your money while you are thinking where to invest it.
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, utilities and other day to day expenses. This is very handy in this regard.
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 of 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 will have the financial freedom that having money saved in the bank gives you.
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. Let your savings account come in handy in your day to day living and use it wisely.
Why do you need a savings account?
1) For the discipline and habit of saving that it instills
2) To have an emergency fund that is more liquid than other forms of investments or accounts
3) To have a place to park your money while you are thinking where to invest it.
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, utilities and other day to day expenses. This is very handy in this regard.
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 of 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 will have the financial freedom that having money saved in the bank gives you.
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. Let your savings account come in handy in your day to day living and use it wisely.
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