While most people opt for fixed deposits and recurring deposits in order to maximise their goals, the same can be done with a savings account as well. Especially, in case of millennials who do not have a large amount of cash to invest in a fix deposit, using a savings account smartly will take one a long way!
A wide variety of different types of savings accounts are available, which help to build up cash to meet future goals. They are-
Savings accounts offering high interest- A number of savings accounts offer high interest on the money one saves. In fact, a few also come with the feature of a high introductory rate of interest that is offered for a particular period of time.
Savings accounts that offer incentives and bonuses- Investing in such a type of savings account is a great way to earn fast money. In case a customer meets particular conditions, such as limited withdrawals, a bonus is added to his account.
Savings accounts online- In case one is too busy to regularly visit their local bank branch, open a savings account online. Online savings accounts offer better interest rates and lower overhead charges.
In order to choose the savings account that best suits one’s needs, consider all the different options and decide how you would like to manage the account. In case one opts for an introductory rate, ensure that a competitive interest rate is offered in order to maximise returns. Also find out the frequency at which the interest is calculated. The more frequently it is compounded the higher will be the returns.
Most importantly, carefully consider all the terms and conditions the bank is offering before opening a savings bank account. Go through all the fees, requirements of deposits and withdrawals, overhead charges as well as any restrictions that are mentioned in the agreement, before accepting it.
Another effective way of optimizing the use of a savings account is opening more than one. This is especially beneficial for those individuals who are looking forward to accomplish multiple goals. So if one has 2 goals to meet in about 5 years, he can set up 2 savings bank accounts and segregate his savings separately. This does help prioritise and effectively plan a budget as well. In this way one knows exactly how much he needs to meet each specific goal, and money can be saved at a faster rate.
Start small by opening two or more savings bank accounts, but achieve big money goals this way!