If you are struggling with a pile of credit card debt, you are probably wondering why you should open high interest savings accounts. With an interest rate that is above the average interest rate, you can easily realize significant savings in a short period of time. If you have been thinking about consolidating your debt, but you don’t want to take out a new bank account, you are probably wondering what you need to do to reduce your monthly payments. In this article we will discuss the advantages of opening accounts for savings and why it is a smart financial move.
When you consolidate your loans, it makes it easier to manage your money. You are no longer paying for multiple interest rates on separate accounts. When you open a high interest savings account, you are increasing your ability to control your finances. If you currently have a high interest rate credit card, you will see an immediate impact on your monthly payment when you close that account. If you plan on re-establishing an active checking or savings account after the consolidation, you can often get a better interest rate this way.
Another advantage to high interest savings accounts is that you won’t be paying fees for transactions made within your account. Most banks charge fees for ATM usage and bill paying. You can avoid these fees when you are only paying interest on the money you are investing. There is typically no minimum balance requirement when you open a high interest account. This can allow you to keep your current lifestyle but save money on costs associated with living outside your home.
When you use your bank account for day to day financial transactions, you are essentially cashing checks and making purchases from your bank account. If you are carrying a balance on your bank account, you may not be able to get access to the money if you need it right away. However, if you take the time to open a checking or savings account, you will have the option of getting the money you need right away if you need it.
With many people facing the uncertain economic times, it is more important than ever to know what your money is doing in order to make wise financial decisions. High interest savings accounts give you the peace of mind that your money is doing well and is likely to do even better in the future. The reason for this is that banks lend their high interest accounts to people who are ready to invest the money, instead of waiting for a rainy day. This gives people the security of knowing that their money is secure.
There are other reasons why you should open high interest accounts, too. If you have a nest egg of some sort, the extra interest can help you get more money than you could get with a conventional savings account. Also, if you are planning on having children in the future, you can use the interest from your child’s account to help fund college savings or any other investment you might be interested in.