If you don’t have a savings fund currently, it’s definitely time to get one. Savings accounts ensure you have money packed away for emergencies and any future needs. It’s really important to put the money you do have in a secure location, like a bank or online bank.
There are many people in the U.S. who do not trust banks and would prefer to leave their cash under their mattresses.
This is not only unsafe but prevents you from benefiting from earning the interest that many banks provide to their customers.
There are many high yield savings accounts where you can earn up to 1% on your savings accounts. Although it’s not a huge amount, it is better than earning nothing.
So, if I’ve convinced you that you absolutely need to start a savings fund for your future, here are the steps you need to take to get there:
1. Decide on a Bank
If you have a relationship with a bank, you can usually set up a free savings account. If you don’t mind banking online, there are tons of options that have numerous benefits. I don’t go in person to any banks actually. Everything I have is managed from my computer. This not only makes it easier for me to track my money, but it helps me save money on gas and other fees too since I never have to go to a brick and mortar building.
2. Put Money in it Regularly
A savings account is all about just that – savings! So, you need to concentrate on building it. The best way to do that is to pay yourself first. As soon as you get your paycheck, place a specified amount into your savings account. It’s actually best if you do this automatically. If you want until the end of the month to pay yourself what’s “left over”, you’ll never be able to save enough.
3. Only Use it For Emergencies
It’s easy to see money in your savings account and allocate it to certain things. A savings account can actually tempt you to spend your money whether it’s a new coat for this winter or that cute pair of earring on sale that you just have to have. Remember, savings accounts aren’t for spending. They are either there to build up to a larger goal like having a down payment for a house or a new-to-you car or they are there as a cash reserve in case you get into an accident, have excessive medical bills, or in general need to make a big repair on your home.
Ultimately, I believe everyone should have a savings fund for their futures regardless of your current situation. Nearly half of Americans live paycheck to paycheck, and that’s something that can be prevented with subtle lifestyle changes and a little cash in the bank. If you don’t have a savings account, take the steps right now to create one. It will only take a few minutes of your time, and you’ll reap the rewards for many years to come.
Do you have a savings account? Is it online or in a brick and mortar bank?- Catherine Alford