If we’ve worked for most of our adult life and invested the fruit of our labours into taking care of our children as well as making sure that they have a smooth transition to independent living , we are in a position to invest some of our earnings making savings for the future. Naturally, we would like to get to get the most value from our savings. As this article will show the matter of savings accounts with cash and the account to pick is not an easy task particularly in times of economic recession, when institutions that offer financial services are not willing to offer anything less than reasonable charges of interest. The first account we’ll examine is the current account.ZZP Boekhouder
The current account
There are many reasons to do this. Once evident in the future, your current account at the bank isn’t one where it is advisable to put your savings into.
There are a variety of current accounts that pay 0 percentage interest on the money you invest regardless of the amount that is in the account. Naturally, with a current account , you are granted unlimited access to your funds as well as all the features associated with the account like the cheque account and debit cards, but the combination of the low (or even in some cases, non-existent) interest rates in addition to the fact that the bank may offer other savings alternatives that are more beneficial and even less flexible. This means you must be cautious before putting any other amount than the minimum balance in a current account.
So, you should have enough funds to meet your needs for the month and make sure that any excess funds are deposited into a savings account that is more effective. account.
The next account we’ll explore is slightly less flexible than the current account, but it is most likely to yield higher returns on savings. It is called the Easy Access Account.
The account with easy access
Like its name suggests, the account with easy access offers an easy way to access your funds at the time you need the funds. However, there’s bound to be a limit placed on the amount which can be taken out at any moment. Since the savings institution is not able to benefit having the assurance that they will keep the savings of the saver over long periods of time, like it is with the other accounts we’ll examine in the future and the rates of interest for accounts with easy access are likely to be low.
But, savers will likely find that the accounts with easy access which offer the highest interest rates are the ones that don’t require a branch or office for the management of the account. Accounts that are run through a phone line or, perhaps, more likely to earn attractive interest rates, via the internet, will cost savings institutions less to manage and therefore they are more willing to offer higher rates of interest on savings.
Even with this benefit However, it’s the reality the Easy Access accounts are amongst the most inefficient savings options available in the market. If you are looking for accounts that offer an increased return, savings institutions require a certain amount of assurance regarding the amount or the time frame that the account will be invested for.
There are various types of savings accounts that institutions provide that offer higher rate of return on savings. They typically are built around the idea of the saver putting in an amount that is fixed for a specific duration, an interest rate fixed subject to certain conditions or the saver putting a minimum quantity into the savings account. The first one we’ll look at falls into the second category, and is commonly referred to as a regular Saver Account.
The Regular Saver’s Account
In simpler terms, the regular savings account is one in which the saver has agreed to invest funds in the savings account on a monthly basis (conventionally this happens every month). Since the institution’s savings can count on the receipt of money on such a frequent basis.
However the majority of savers discover that the most accessible accounts that offer the highest rates of interest are the ones that don’t require branches or an office for the organization for the accounts. Accounts can be managed through a phone line or more likely to be Regular Saver Accounts reward investors who will deposit a certain amount regularly (usually for a month) into their savings accounts. Since the savings institution can work on the assumption that a set amount will be paid out, it is able to offer what can be occasionally very appealing interest rates. But, there are some limitations that apply to the accounts. First of all, since the rates of interest offered could be appealing, there is an upper limit to the amount of money that can be put into. If the upper limit is not met then there will be interest penalty that will result in a lower yield on interest.
Additionally, it is likely that there is a limitation on the amount of withdrawals the saver is allowed to take in a calendar year. In addition, any violation of the rules could be a cause for a penalty against the savings interest return. However, for those who make very small investments who can see their money tucked away for a time in the future, using the Easy Saver can be a viable choice. The second type of savings account we’ll look at is one in which the interest rate is greater than that of the standard current account or simple access account, however there are additional restrictions that impact the access to your funds. This is called the Notice Account.