Everybody is under financial pressure due to the difficult economy. Prices for goods and services are increasing every day. We all need money to pay our bills, buy essentials, pay for medical expenses, and the list goes on. The problem is that in times like these, we don’t have enough money to pay for these expenses. This is why it is important to save a part of your weekly or monthly income. This article is all about the ADVANTAGES OF HIGH YIELD SAVINGS ACCOUNTS.
ADVANTAGES OF HAVING A HIGH YIELD SAVINGS ACCOUNT
1. A HIGHER ANNUAL PERCENTAGE YIELD (APY)
Not all savings accounts yield the same interest. High-yield savings accounts offer higher interest rates or annual percentage yield (APY) than savings accounts offered by traditional banks. These high-yield products are offered by banks that do not have hundreds of branches, and this lowers their costs. They can offer higher APY because they share the cost savings with their customers. A higher APY means more interest income to you. This is compounded if you leave the deposits for the long term.
2. SEPARATE YOUR SAVINGS FROM YOUR SPENDING
Some people always seem to have spare cash available in an emergency. This is because they put aside some of their income every month. To have more money available to invest in a high-yield savings account, put aside part of your income before you pay all your bills. A good idea is to try to save 5-10% of your income every month. Try to put the savings away even before you start paying bills. The more money you are able to put away before spending, the more you will have available in case of emergencies. So start saving now by sacrificing some of your spending habits. Especially those unnecessary items, so that you can enjoy the benefits later.
3. BETTER TRACKING AND MAINTAINING OF FINANCIAL GOALS
By saving money in a high yield savings account every month, will not only provide for emergencies. It could also make possible the things you have always dreamt about, such as a family vacation. It will take some monthly planning. It is important to track your monthly expenses as well as your monthly savings. Tracking these items every month means that you have a good idea of what is going on in your finances. You can achieve your financial goals, if you control your expenses and stick to your monthly savings.
4. MAKES YOU MORE PATIENT WITH SPENDING
Many people have the urge to spend on something every day. One of the main reasons why many people do not have savings , is because of impulsive buying. Some people immediately run to the mall as soon as they have received their salary. They buy things that they do not need at all. The more you give in to these needs, the less you have to put away in a high yield savings account for emergencies and for those dream items. They say “patience is a virtue” and the more patient you are by putting money in a savings account, the more you will have in the account to earn you higher interest. If you can make this a firm habit of putting money in the bank every month, it will lead to being more patient with your spending habits. So spend wisely and save for a better tomorrow for you and your family.
5. PREPARES YOU FOR THE EMERGENCIES
Life happens. There are always unexpected expenses, such as medical bills, car maintenance, emergency repairs at home, or unexpected travel for family emergencies. By having a nest egg in a high yield savings account, will help you to sleep better at night. You will be prepared for times when these emergencies happen. If you do not have emergency funds in a savings account, may force you to take out a loan to pay for these emergencies. The interest on these loans is always a lot more than what you could have earned in a high yield savings account. Another option is to ask family or friends to assist you with some money but this could ruin relationships.
It is important to always be prepared with some emergency funds so that you do not have to be in a situation to make a loan. This will lead to unnecessary stress. Having no money is one of the largest stress factors that people face. The more money you have saved away, the less worries you will experience.
So the choice is yours, whether you want to start saving today, or continue spending on things that are not important. If you want to save, the best option is to open a high yield savings account. You can do this without even stepping foot into a bank. You can go online now and you will be on your way to putting your hard earned money in a safer, smarter, and more beneficial account.