The benefits of opening a savings account at the bank

It’s often tough to do every month but putting away money can provide the stepping stone to financial freedom and avoid a rainy day. No more of the old school method that requires the stashing of physical coins and notes under the mattress or in a piggy bank, because everything is done digitally these days.

All of the major banks (Absa, Capitec, FNB, Standard Bank, Nedbank) across the country have their own savings plans to choose from with varying interest rates. The point of saving money means that you are working towards something in the long-term future that could include investing in property or pursuing a business venture.

Clients can choose between fixed or flexible plans. A fixed plan enables allows the money to stay untouched in the account, gathering interest but can only be freed up once the client gives the go ahead, while the flexible option allows immediate accessibility to the money. It is recommended to have online internet banking enabled to allow for the transfer between accounts.

There are numerous benefits to be had from opening up a savings account and as such, Gumtree outlines some of them below:

Unexpected Expenses

One can never predict what will happen in the future and that includes everyday things like a burst water pipe in the home or your car unexpectedly needing a brand-new battery. Most households plan according to a budget so having extra cash saved up acts as a safety blanket for the unforeseen circumstances.

Keep your money safe

Only you as the client has access to the funds and can do with it as you please, thus also making it a low risk investment. The money is not affected by the stock or exchange rate as opposed to higher risk investment.

Your balance will only go up

When you use a savings account, your balance does not decrease. It will only go up. Depending on the amount you put away every month, with it comes its own level of interest. A larger amount warrants a higher interest rate and that is guaranteed every month unless of course you decide to withdraw everything.

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