If you’re in the first stage of improving your finances, just getting to the end of the month without going into debt, or further into debt, is a challenge in itself.
A months down the line on your money journey you might have paid off your debt and now have some spare money to save but you’ve got lots of different money goals that all need to be funded somehow.
Later on in your wealth building journey, you may have saved a big pile of cash and be investing regularly in your future.
However, regardless of where you are in your money journey, you need a Savings Account .
In Debt? You Need a Savings Account
If you’re in the first stages and don’t feel you can afford to have money ‘saved’ each month, then, perhaps paradoxically, it’s even more important that you do have some money saved, separately, away from your main current or checking account.
Of course I’m not telling you to go hungry or not be current on any debt repayment, but it should be your priority to get some money saved, and make sure it’s segregated away from your main account, even if it’s only a small amount. Many savings accounts let you open up with £1 or $1, anyway.
It’s not embarrassing.
It’s not silly.
It’s a start for you to build upon.
Over time you can top it up and when a real emergency strikes you’ll be happy you had your savings (rather than being forced to use expensive debt). Keeping them separate also goes some way in stopping you from spending the money on things that aren’t real emergencies.
Out of Debt? You Need a Savings Account
If you’re a little further down the road on your money journey you may be feeling the pull of different savings goals. You might need several savings accounts to help you keep track of where you are up to on each goal. Or you might prefer the single-minded focus of saving for one thing at once. Regardless of which approach you take, the discipline of regular saving can have a huge impact on what you can achieve financially over time.
Building Wealth? You Need a Savings Account
If you’re further down the road still, you might feel you have graduated away from savings accounts as you’re now more interested in bigger growth opportunities such as investments.
But no! You still need a savings account, filled with money – not for the prospect of growth, but rather for future emergencies and opportunities. You might be losing money in real terms due to inflation, but that is merely the cost of having money available to you quickly to allow you to pounce on great opportunities and recover quickly from bumps in the road. It’s worth it.
You don’t save money for the returns.
You save money to provide safety, for the funding of dreams, and for lowering risk in your life. You are even protected up to £85,000 in the UK should the financial institution you’re saving with go bankrupt.
Look after both the present and future you, and top up your savings account today!