As we get older, the need for budgeting, cutting expenses, and paying debts will arise. Eventually, a savings account will be essential to reaching and managing our financial goals and obligations.
Not many may understand the concept of a savings account. If you’re still contemplating whether to get one or not, here are some things that might convince you to sign up for one now.
- It Will Stop You from Spending Impulsively
The money inside savings accounts is not easily accessible, but that’s fine. The purpose of a savings account is to help you save money for future uses and protect it—even from yourself. A savings account is more restricted, unlike a checking account. You can’t just swipe a card to access your savings account. It may give you the discipline you need for financial stability.
It will allow you to prepare for anything. Your savings account is similar to a storage box. It’s not hard to access when you badly need it, but it adds a layer of protection to make you less likely to spend it.
Unlike a checking account, you can’t just swipe your debit card and spend money from your savings account. This might help you pay bills and purchases through Automated Clearing House (ACH) checks, but overall it’s less accessible for spending impulsively.
- It Will Help You Avoid Debt
It’s best to avoid bad debt, especially if you have big plans for your financial future. This means that you’ll need to avoid excessive credit card spending and loans you can’t afford. Having a savings account can definitely help you achieve this.
- It Will Keep Your Money Safe
One of the benefits of having a savings account is the reassurance that your money is insured. It doesn’t matter whether your savings account is in a bank or a credit union. Your money will still be protected from fraudulent charges or withdrawals, no matter what.
After all, your money is safer in a bank account than it is in your home, where it might get stolen or destroyed by unfortunate incidents like fires and natural disasters. The worst part of storing money at home is that it cannot be insured.
- It Will Allow you to Have Extra Money for Emergencies
No matter who you are or what you do, accidents and emergencies are an inevitable part of life. Having a savings account can definitely help you prepare for such emergencies. Even if your savings cannot cover the entire cost, you can still mitigate the financial blow with insurance.
Getting a savings account is definitely one of the best decisions you’ll make in your financial life. Not only is it practical, but it will help you make sure that you have a little extra tucked away for rainy days. Your future self will absolutely thank you for making a savings account!
Here at Good Neighbors Credit Union, we provide a great variety of products, services, tools, and resources that help our members manage their finances responsibly. If you ever need to get a loan, we are here to aid you. Become a member now!