We are always told to develop good financial habits, and one of them is saving money. There are a lot of options that enable you to set aside money and let it grow. From high interest savings account and mutual funds to stocks and bonds, there are several ways to be financially secure. One of the most common savings and investment products is a savings account. It’s easy to open one in a bank, and for those who are just starting to save money, a savings account is probably what will come to mind.
Deposits earn interest in a savings account
If you want higher returns, you may want to consider high interest savings accounts. All you have to do is make a deposit on a regular basis and let your money earn more.
But with so many savings and investment products out there, why do people choose a savings account in Australia? Here are five reasons:
It’s very accessible
This is probably one of the top reasons people prefer a savings account over other investment products. When you need money, you can easily withdraw cash from your savings account. With an ATM card, you can access cash anytime, anywhere.
Prepare for unexpected expenses
Emergency expenses happen, and it is frustrating not to have enough money for incidents such as loss of a job, car repair or house repair that can significantly affect your financial plan. That is why a lot of people set aside money in a savings account. In general, having about three to six months’ worth of your net salary in a savings account will greatly help you get through expenses.
Save for vacations and/or major purchases
Planning a family vacation? Do you intend to buy a new entertainment system? Many people have a savings account to prepare for things that they need or want in the near future. Whether it is a holiday or a big-ticket purchase, having a savings account is a good way to save money.
Let money work for you
Your deposits earn interest in a savings account. You may think it’s not a lot but it’s way better than keeping your money in a piggy bank or your dresser. If you want higher returns, you may want to consider high interest savings accounts. All you have to do is make a deposit on a regular basis and let your money earn more.
This develops healthy financial habits
Once you start setting aside money in a savings account on a regular basis, not only are you slowly building your savings plan, you are also building sound financial habits that include avoiding impulsive buying and being more aware of the value of money. As you save money, you become financially literate, enabling you to understand how to better grow your savings, the importance of budgeting, and setting financial goals.
Do you have other tips on high interest savings accounts in Australia? Share your ideas in the comments section.