Why a Savings Account is Better than Having Cash
When dealing with finances, the phrase “cash is king” may pop into your head, but that’s not necessarily the case anymore. The benefits of having a savings account with a credit union often outweigh the bulk and temptation of stashing cash. With a credit union savings account, you can earn money while having peace of mind knowing your money is safe, and develop the discipline to set budget and savings goals.
When money is tight, putting it away can be hard. A savings account allows you to put away small amount of money at a time. You can deposit whatever you like as long as you open the savings account with the required minimum deposit. There are also several ways to deposit money into a savings account that don’t involve stopping by a branch, such as mobile deposit or ATMs that accept deposits.
The security of keeping your money in a savings account instead of stashing cash is another added benefit. It’s much harder for someone with bad intentions to access money in a savings account than cash you keep. You also can’t misplace or lose money in your savings account, and if you have online or mobile banking access to your savings account, you can view and manage your account, as well as monitor transactions.
Earn Interest and Collect Dividends
You may have heard of the phrase “you have to spend money to make money.” With credit unions, you have to save money to make money. Simply put, while your money is nestled away safely in a savings account, you’re earning something just by keeping it there. As a member of a credit union, you’re also part-owner. As an owner, you make your “interest” on the account in the form of dividends. It may not be a life changing amount, but it’s more than you’ll make by keeping cash in a box.
Save with Discipline
When your money is in a savings account, it’s more difficult to spend, and that’s not necessarily a bad thing. Many savings accounts have a limited number of transactions per month, which keeps you from constantly accessing money like you can with a checking account or if you’re using cash.
You can also save by having a portion of your funds taken out of your paycheck and deposited into the account automatically. This will also help cultivate better financial habits by training yourself to set aside a specific amount of money each paycheck and help you stay more conscious of your finances.
However you decide to save, give yourself a pat on the back for putting some money away. Even if you have a savings account, remember that storing some cash for an emergency is not necessarily a bad thing, but it may not be worth putting all your eggs in one basket. If you’re interested in putting some cash into a savings account, come see us at the Frenchtown Financial Opportunity Center and we’ll help you get started.
*The content provided in this article consists of the opinions and ideas of the Frenchtown Financial Opportunity Center, does not constitute legal or financial advice, and should be used for informational purposes only. Any decisions you make based on the information contained in this article is made in your sole discretion and liability. The Frenchtown Financial Opportunity Center disclaims any damages or liability for decisions you make based on the information provided.