Everywhere you turn there are a number of companies trying to sell you on a savings account. What’s so special about savings accounts anyway? Is there really a need for one? Actually there is. In fact, there are several reasons to have one. Here are just five reasons every family needs a saving account.
Peace of Mind
Emergencies happen and when they do it’s nice to know that you have the money set aside to take care of those emergencies. Whether it’s a new set of tires or a broken water heater, it pays to have money in a savings account. Many people recommend having 3-6 months of your salary set aside, but even $1,000 can be enough to get you through a rough spot.
Harder Access to the Funds
It can be easy to put extra money into your checking account, but how often does it get spent? Instead of being able to easily see those funds in your regular account, having a savings account allows you to forget about the money and let it grow. For even easier growth, try setting up an automatic transfer from your checking account.
Free Money
Who doesn’t want free money? When your money sits in a savings account it’s earning free money. Of course, it pays to shop around for the best interest rates and to choose a bank that has few restrictions. While the interest earned may not be much, it’s still free money.
Easier to Save for Big Purchases
Whether you’re planning a vacation with the kids, or want to buy a larger TV for the family room, a savings account makes it easier to keep up with how much you’ve saved. Best of all, some banks allow you to set up more than one savings account so that you can easily save for different expenses.
Freedom Fund
Last, but not least, a savings account can be a great way to reinforce good spending habits. Whenever the family saves money on something, put the money saved into a savings account. For example, let’s say that instead of going out to eat, you eat at home and that saves $40. Put that money into the account and at the end of the year use the money saved to buy something the family wants, such as a new TV or swimming pool.
As you can see, having a savings account can make your life a lot easier. Not only can it help cover the cost of emergencies, but it can also make it easier to save for large purchases. Best of all, it can encourage the family to try to save money for a fun purchase down the road.
