If you’ve been following my blog, you know that I’m a strong believer in the importance of saving money. That’s why it’s no surprise that one of the first pieces of advice I ever gave was to open a savings account. But if you aren’t convinced that savings accounts are worth your time or effort, let me share with you four reasons why I think everyone should have one:
1. Savings accounts build healthy financial habits
A savings account is great to start building healthy financial habits. You can open bank account online, start small and increase the amount you save each month over time, or set up recurring deposits or automatic transfers from your checking account to build up some savings. As those at SoFi say, “an online bank account conveniently allows you to manage your accounts from your computer or mobile device.” That means you can streamline and safeguard your savings without having to visit a bank. Don’t forget to learn about the common types of check frauds to safeguard your savings account.
When you’re ready to open an account, consider opening one in your child’s name if they’re young enough that they won’t be using it yet. That way, they can see what saving looks like—and maybe even get excited about it!
2. Savings accounts help you build a safety net
In order to be prepared for the future, you need to create a safety net. The more money you have saved up, the more options you have. If something unexpected happens and leaves you without income, having a cushion can help make sure that life doesn’t become too difficult right away.
Getting started with savings is easy; all it takes is opening an account and making regular deposits into it. Once your balance gets high enough, you can use some of it to make investments or start businesses—or just keep adding more money as time goes on!
3. Savings accounts help you reach future goals
Savings accounts can be used to fund your retirement, pay for a house, or even start a business. If you don’t have savings built up, that means you’ll have to take out a loan in order to fund those big purchases and get things done. But once your savings account is established and growing steadily, it’s like having extra money in the bank for those occasions when emergencies arise, or unexpected expenses show up on the monthly bill cycle (which is likely going to happen at some point).
4. Savings accounts can be used for reinvestment in yourself and your future
If you’re in your twenties or early thirties, chances are you have a lot of goals to work towards. Maybe it’s buying your first home or paying off student loans. It could also be saving up for a new car or setting aside money for retirement. Whatever it is, having savings will help make these life changes much easier than if you didn’t have any savings at all.
Savings accounts can even be used as a means of investing in yourself and your future by funding personal growth opportunities such as continuing education courses or taking on side hustles that will increase your income potential (and thus contribute to those future goals).
In short, savings accounts are an important part of managing your money, and they can be used to help you reach your goals. Whether that means saving up for a new car or house or investing in yourself through education—savings accounts have a place in almost every financial plan.
Salman is a prolific environmental writer, and has authored more than 500 articles in reputed journals, magazines and websites. He is proactively engaged in creating mass awareness on renewable energy, waste management, sustainability and conservation all over the world.
Salman can be reached on salman@cleantechloops.com
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