Savings accounts are the best way to build wealth and avoid any debts. It is an effective tool that guides you as to how much you should spend and how much can you put away. However, the questions that some have in their minds are: is it safe to hold multiple savings account? Does it lead to building wealth?
Let us understand why people consider having multiple accounts in the first place.
People think a savings account is a dumping ground where they can stash the leftover cash for a rainy day. Now, one savings account can only assist you to fulfil one goal. You may have many dreams to accomplish at every stage. Precisely why it is good to open a savings account in many banks.
We give you other reasons as to why you should hold multiple savings account:
Multiple goals: You may have to fund your child’s education or wedding, head for an impending vacation. In the worst case scenario, an unexpected event such as medical treatment or hospitalisation may require immediate funds. Each short-term or long-term goal will need you to have liquidity for immediate use. This way it is easier for you to keep track of the account and funds in them. To avoid confusion, you can also set an automated money transfer system.
Separate your savings: The other reason it is good to have multiple savings account is that it inculcates a saving habit within you. You know you have to keep a certain amount of cash aside for your various goals. This way, you can separate your money for each savings account.
Trust issues: There are chances you do not trust the bank you are operating with. Sometimes, banks may suffer a sudden loss. At such point, the bank may be unable to reimburse your amount immediately. So, spreading out your hard-earned money in different banks is a good solution.
Additional benefits: You can receive plenty of advantages by opening a savings account in different banks. Each bank provides insurance facility, debit cards, passbook and chequebooks. This way you can use the card at various ATM points across the globe or utilise the insurance for any long-term goal.
Indecisiveness: This is a major concern that crops in our minds the moment we research about different banks online. The internet is a medium where it is easy to conduct comparative analysis and learn about the varied features that each bank has to offer. That can lead to indecision. To get rid of the same, you can always open multiple savings account and reap the benefits from each bank.
- Multiple withdrawals: Usually banks limit withdrawals to just 6 times per month. But say if you hold 3 savings account, you can withdraw 18 times per month. However, ensure the money is put to good use and does not end up as a wastage. Otherwise, you will face a cash crunch.