Getting into the habit of saving is not easy. If you are able to put some money aside, you would want to put that money somewhere where you can begin to get value out of it. A personal savings account is a good place to start.
A personal savings account allows you to store your cash securely and then accumulate interest on that cash. This account is important for those who wish to save some money for an emergency fund or future usage.
What are the Benefits of Having A Savings Account?
The main objective of a personal savings account is to promote you to save money. Usually, there is no maximum number of times you can deposit money into the account. It is important to note that when your money is in a personal savings account, it is less accessible than if it was in a personal current account. For some, the interest earned on the money saved can also serve as an alternative source of income.
What Should You Look Out For When Opening a Savings Account?
- The interest rate: Different banks will have different rates and one must carefully choose one that suits them. In some cases, the bank increases the interest rate according to how much money is in the account. Usually, the rate of interest payable is very small on saving accounts, but it is better than no interest at all.
- Minimum monthly balances: Most banks insist on their clients maintaining a minimum account balance and charge a fee if the client is unable to maintain it. It may be helpful to find a bank that does not charge when you go below the minimum balance. Most banks insist that a minimum balance be maintained at all times in order to keep your savings account active.
- Unlimited transactions: Due to the nature of the account, banks often limit the number of transactions on a personal savings account. If you need to withdraw your funds frequently, then look for a personal savings account that allows frequent accessibility at low costs. You can also find one that has a debit card as well as a cheque book.
- Opening Deposit: Some banks have high opening deposits that also form part of the minimum operating balance. Therefore find a bank that has a suitable amount that you can manage.
In order to ensure you find the right savings account, make you first set a financial goal. Financial goals are targets, usually driven by specific future financial needs. Saving is important because it is the first step towards achieving those financial goals. Make sure you find a bank that is able to help you achieve those goals by comparing different savings accounts with different service offerings and finally choosing the one that is able to complement you.
Learn more:
What is Saving and Where Do I Start?
