Whether you are looking to purchase a house or want a rainy day fund, it is essential to have the reserve you need. But, where should you deposit that money to achieve financial security?
Savings accounts have many benefits, especially if you are looking for a place to store your hard earned money while gaining some interest on it. Most credit unions and banks require $25 to open a savings account — and DEXSTA only requires $5 to open a savings account. You can even open an account online if you are already set up with your credit union or bank.
Opening a savings account is relatively simple, and doesn’t require a lot of management. Technology has made depositing money easy. Many institutions allow you to deposit money into your savings through direct deposits from your employer as well as mobile check deposits. If you already have your checking account set up online, at the same location, you can easily schedule free transfers from your checking into your savings. Think of it this way, if you scheduled $10 once a week to go into your savings account, you’d hardly miss the money, and over time those deposits will accumulate.
Not to mention, saving accounts are less prone to extra charges compared to checking accounts. But remember, the more transactions you complete on your account, the higher the chance you’ll run into paying fees. Keep in mind that this account is made for saving, checking accounts are meant for withdrawing.
By opening a savings account, you’ll most likely end up saving a part of what you earn. Savings accounts do not come with cards or checks, so there are more barriers to withdrawing money. This can protect you from spending impulses and help you keep your money in your account.
Storing all of your cash at home is not a great idea and investing all of it means you won’t have any when you need it. Spreading out your money in different accounts is smarter and gives you accessibility.
A savings account is a perfect place to park your money. You need to build up your foundation and accumulate sufficient funds — especially if you are looking to invest in stocks or real estate. While your money sits in your account, it will earn interest and keep growing until you are ready to take it out.
This type of account can help you save for the things you always wanted. If you are looking to buy a car or vacation at your dream location, opening a savings account is the first step to achieving that dream. Another critical point of a savings account is to help you with unexpected expenses. Remember that rainy day fund? If something happens, a savings account can help pay for unforeseen costs. It is essential to create an emergency fund, but if you are just starting to save, your savings account could act as a temporary emergency fund until you’ve saved enough to have a separate account.
At DEXSTA Federal Credit Union, we can help set you up with a share savings account. Share savings accounts have the same characteristics as savings accounts. The difference is share savings accounts are held at credit unions, but the way the account is used is the same. Stop by one of our branches or give us a call, we would be happy to walk you through financial options!