If you’re reading this, you’ve already opened a savings account. And if you haven’t, this may help put your mind at ease by letting you know the steps to open a savings account. For example, opening a savings account is more than just a mandatory step in getting your finances in order—it’s an important first step that can help you find ways to save money and build wealth over time.
Build an emergency fund
Opening a savings account is worth it if you can do so without putting a strain on your finances. But if opening an account would cause you to miss rent or skip meals, the cost of doing so may not be worth it.
If you can swing it, though—and have money set aside for emergencies—then building up an emergency fund is one of the best things you can do for yourself.
Boost retirement savings
You could also open a savings account, which is a great way to save for retirement. The most straightforward option would be a Roth IRA—which, unlike a 401(k) or traditional IRA, has no tax deductions (but can allow you to take out your money without penalty). A Roth IRA also keeps your funds invested and growing without any risk of losing money due to inflation. So if you’re worried about saving enough and not being able to pay into your retirement fund later on, this may be the best choice.
Your deposits are safe even if the bank fails
You can rest assured that your deposits are safe even if the bank fails. The Federal Deposit Insurance Corporation (FDIC) guarantees it, up to $250,000 per account. This isn’t just an arbitrary limit based on some number of digits; it’s actually a figure arrived at after much research and deliberation.
The FDIC insures a range of deposit accounts, including checking and savings accounts as well as money market accounts (MMAs), certificates of deposit (CDs), individual retirement accounts (IRAs) and more.
Savings accounts have no expiration date
In addition to a savings account being a great place to keep your money safe, it also offers some other benefits. Firstly, there’s no expiration date on these accounts. Even if you withdraw all of the funds in your savings account at one time, you can always put more money into it later on!
Additionally, saving money with a traditional savings account will allow you to make deposits at any time without penalty; this means that when an emergency comes up or an unexpected expense arises. Lantern by SoFi experts says, “You can open savings accounts at credit unions, traditional banks and online banks.”
The convenience of a linked checking account or ATM access
- You can link your savings account to your checking account.
- You can use your savings account to pay bills, make donations and payments, and buy things using direct deposit or automatic bill pay.
- You can use it as a debit card when you’re out shopping.
- Some banks will let you transfer money between accounts without having to visit the bank in person, saving you time and hassle.
Opening a savings account may be a great way to start saving money. While it can be difficult to determine the best savings account, hopefully, this review helped you make the right decision for your needs.
In conclusion, if you want to save some money, opening up a savings account is worth doing as it can help you save more than if there was no savings account available.