Indulging in activities like saving money on a regular basis helps to build personal finances in an organised way. One of the best ways to incorporate this habit for an individual of any age group is by opening a savings account. and getting the best saving account interest rate. It is the safest facility provided by financial institutions like banks and post offices to individual clients.
Customers can open a savings account in their name and start depositing money at their convenience. The amount saved in this account for an extended period of time then starts to earn steady interests which becomes a regular source of income.
Here we have listed a detailed set of pointers that will help you to get a clear understanding of the ways a savings account turns out to be useful in the long run.
Protects your asset
Savings accounts are completely safe by nature since the assets kept under this particular account type is free from any kind of market volatility. Indeed, the money in a savings account does not have as many chances of high returns compared to the money earned from real estate, mutual funds and bonds. But again the money under a savings account does not get hit by unforeseen circumstances that might force the investor to withdraw investment at a lower return. Thus leading to a consistent income.
Getting rid of debts is easy
Paying one or more debts using a savings account is super easy. When taking up a loan, the lender provides an “auto-debit” option. Using this process the borrower can fix a date on which monthly EMIs will automatically be credited to the lender’s account. Availing this facility is convenient too, as long as the borrower has sufficient balance in their savings account.
Assists in maintaining liquidity
Liquidity refers to how easily and quickly you can get access to cash during an emergency. Compared to a mutual fund or a fixed deposit, getting access to cash from a savings account is more feasible. There are plenty of ways that help to withdraw cash from a savings account, like utilising a Debit Card on an ATM facility, writing a cheque, online transfer and so on.
Seamless account opening process
Opening a savings account is seamless, the account holder just needs to visit a bank branch along with their KYC documents, passport size photographs and a minimal amount of the base money. It can be done even online by visiting the bank’s official website. This makes it a great investment avenue for youngsters since they can easily open an account, get access and have control over their savings without visiting the bank physically every time. It also helps them to understand the value of savings. Earlier banks used to keep a certain amount as minimum savings account balance, but now it has been waived off. So, now the account holder can keep any amount of money in their savings account without any cap.
Avail the benefits of Government schemes
Savings accounts help individuals gain subsidies from the government, in an organised way.
This helps the Government to hinder the interference of a middleman and offer direct benefit transfers.
Offers facilities like international Debit Card and more
Having a savings account in India enables an account holder to avail of facilities like quick currency conversion, international Debit Card and other beneficial offers.
Convenient to pay bills
A savings account can be used to pay bills through its “auto-debit” option. This particular facility enables the account holder to predetermine a date along with an amount and get the money transferred to the service provider in real-time.
Helps to take precaution for unprecedented future events
The amount of money saved under a savings account helps to take precautions for unprecedented future events. During emergencies, account holders can get the money transferred or withdrawn at their convenience.
Hassle-free digital transaction
Individuals can link their savings account with online payment gateways and get the required amount transferred in real-time. Be it paying for online shopping, travelling related expenditures like flight and hotel booking or entertainment purposes they can cover it all.
Permanent interest income
Owning a savings account also earns a steady rate of interest for the account holder at fixed intervals. Although the interest rate varies from one bank to the other, it is quite beneficial in the long run.
There are several types of savings accounts like Regular savings account, Zero Balance account, Minor savings account, Women’s savings account, Jan Dhan account and so on. Based on your required facilities and financial goals, you can decide upon which one to choose.