Why Open a Savings Account?

Although most individuals have a savings account, there are still a few who think that it is wiser to save and keep money at home. For those who maintain this view, what then are the reasons that one should open a savings account?

The primary reason would be to encourage and enhance saving. Technically, one could save anywhere. However, the chances of one really keeping to the promise so to speak of not using the saved money are hard to keep especially when the said funds are close at hand. Thus, opening a savings account provide benefits to an individual in terms of saving that would not have been available if he or she opted to keep or save the money individually.

One benefit is that deposits would be easier. A common quote is that money in hand is money spent. This is very true for most of us, for as mentioned earlier, it is very hard to resist the temptation of spending money at hand. By opening an account on the other hand, you’re readying it for deposits. The commitment to save increases for it would be easier to deposit anytime. Saving and spending thus becomes easier. Many are afraid that it would be difficult to withdraw money on a savings account. However, this is not the case.

In line with the commitment to save, money in a savings account is psychologically hidden. This means that the urge to spend or splurge would be lessened. When we open a savings account, it’s like we’re saying that it would only be used in times of dire need. We treat it as though it were not there in order to keep it for future contingencies. For the most part, it is relatively harder to get cash from a savings account. But again, this does not mean that it is impossible to get cash from a savings account.

In order to withdraw money from a savings account, it needs to be transferred to a checking account so that it could be withdrawn from an ATM. This added obstacle so to speak makes an individual think twice if the purchase or expense is really needed or not. The delay therefore gives us time to reflect on our expenses and helps us avoid spending on whim and of course, keeps our money in the bank.

By considering these benefits, it’s about high time that one consider opening and maintaining a savings account.