Do you currently have a savings account in place? In the past, having a savings account for a rainy day was commonplace and most adults who could afford to put some money away would. Now, savings accounts are not as common as people like to purchase things on impulse and neglect to save when they are young.
While savings accounts might not be as popular as before, they are definitely still available for those who require them. In this guide, we thought we’d look at some of the reasons why we think you should go ahead and open up a savings account today. Read on to find out what these are.
Emergency Funds When You Need Them
One of the main reasons why you might want to open a savings account is that you can protect yourself when something goes wrong. Depending on where you live, you might need to pay for emergency medical care or dental work when you get in an accident or become unwell. If you don’t have the funds saved up to cover these costs, you could find yourself in a tricky situation.
With a savings account, you can have some emergency funds that you can rely on. Set some money aside each month and you’ll thank yourself when something needs to be dealt with sooner rather than later.
Buying Your First Home
When you are thinking about buying your first home and you need to take out a home loan, you’ll need to have some kind of deposit to back up your payments. Lenders won’t just offer a large mortgage to anyone, especially to those who don’t have any kind of down-payment to offer. So, if you start saving now, you can prepare for the future when you eventually decide to purchase your own home.
Remember that the down-payment that you need to offer will depend on how expensive the property is. For a more expensive property, you’ll need to start saving sooner to secure the right size of home loan.
Set Up for a Family
Savings can come in handy when you decide to expand your family and have children. The truth is that starting a family can be very expensive and if you don’t have the savings to cover the cost of medical bills, equipment and a larger home, you won’t be able to have children as soon as you had hoped.
By setting up a savings account today, you can get yourself set up for the future. If you already have children, you can even set up a savings account in their name and protect their future. This is a great idea and something that more and more parents are doing over recent years.
Interest Rates Can Help
While you may not have a lot of money to save and put aside, you could find that a good savings account could benefit you. Depending on where you put your money, you could find that the interest rates are quite high and that your funds can build up over time. Sure, you won’t be gaining a lot of money every single year but if you set up your account early on and add to it over time, you could end up with more than you put in there.
When looking for a savings account, check out the interest rate that comes along with it. If there are high rates available, this might be a good place to start.
Afford Higher Ticket Items
Finally, if you haven’t already set up a savings account then you should consider it if you want to be able to afford higher ticket items. This includes things such as holidays, a new car or even a new washing machine when yours eventually breaks down. Many of us like to be able to afford some more luxurious items from time to time and a savings account can help with this.
It can be difficult to afford these items if you don’t have the spare cash set aside. If you have a specific high ticket item in mind for the future, why not set up a separate savings account for that? You’ll soon find it easier to afford that new car!
If you don’t yet have a savings account set up then you should start looking into this further. Even those who are still young should be looking toward their future and deciding how they will afford big ticket items and down-payments on a home.
You might find that your current bank will allow you to set up a savings account easily enough but you can also look elsewhere. Make sure to consider everything that we have discussed in this article and use this information to make the right decision.