5 Financial Milestones You Can Achieve by Leveraging Bank Services
Written by
John Schmoll
Edited by
Jenna Klaverweiden
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It’s easy to think of a bank as only the place to deposit your cash, hoping that it will grow over time. Your bank is often significantly more than an ATM or place to make mortgage payments.
Many banks offer a wealth of resources you can use to achieve financial goals. All of the available tools may not be worth your time, but taking advantage of the right ones can maximize returns.
Here are five financial goals a bank can help Americans reach.
Also see seven clever ways banks can help you achieve your investment goals.
Saving for Large Expenses
Saving money for a rainy day is vital to financial stability. However, many people struggle to regularly save. According to Forbes, 28% of Americans have less than $1,000 in savings. A bank can help both people who are struggling to save and people who are saving for large expenses achieve their goals.
Most banks allow customers to automate transfers, free of charge. Aside from making a simple one-time request, there’s no required work to maintain. Banks can transfer funds at your chosen interval, either to a savings account at the bank or to a high-yield savings account at another institution.
This eliminates the impulse to spend more, and it builds consistency, allowing you to amass savings. Some banks may even allow you to create a dedicated savings sub-account for a specific goal and move a chosen percentage of each paycheck to it. Round-up savings offers can further optimize savings goals.
Getting Out of Debt
Debt plagues many Americans. Total credit card debt reached $1.18 trillion in the first quarter, according to the Federal Reserve Bank of New York. A bank can be a helpful resource for Americans struggling with debt.
Many banks offer balance transfer cards to move indebtedness to an interest-free card to aid in quicker elimination of debt. The catch is that the debt must be repaid before the promotional period ends. For those not wanting another credit card, banks offer personal loans that may provide a lower interest rate than your credit card, allowing you to save on interest.
Other tools of interest for people pursuing debt freedom include financial counseling and free credit scores. Not all banks provide these tools, so consult with your bank.
Reaching Retirement Goals
If you’re searching for ways to grow your wealth, a bank is a natural thought. While a bank may not have all the tools of an online brokerage, most institutions offer various investment services designed to aid in retirement planning.
These can give access to mutual funds or other managed products, through a human or robo-advisor. As with working with any financial advisor, perform due diligence to verify expenses aren’t too high and that investments fit your risk appetite. Some larger banks even offer private wealth management and estate planning for those with greater means.
Establishing and Sticking to a Budget
Mobile banking simplifies the burdensome task of budgeting. Thankfully, mobile apps and tools are commonplace. In fact, only 8% of Americans go to their local branch for services, according to the American Bankers Association.
A robust banking app includes various money management tools:
- Payment alerts
- Customized budget categories
- Cash flow trackers
- Spend trackers
- Interactive charts
- Low-balance alerts.
Some banks may offer cash-back deals via mobile apps to help stretch your budget.
Launching a Small Business
Do you dream of launching a small business? Many banks have ways to assist with business banking needs. Whether you’re growing a freelance business or plan on growing to multiple employees, a bank can help.
Business banking accounts are a given, but many institutions go beyond that. Tools can include payroll services, access to loans, payment processing, free notary access and more. Larger banks may also offer guidance for specific niches.
A bank is often much more than the place you go to withdraw cash. It can also help you achieve various financial milestones, often for free or for a minimal charge.
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Sources
- Forbes, “American Savings By Generation: How Balances And Goals Vary By Age.”
- Federal Reserve Bank of New York, “Household Debt and Credit Report.”
- American Bankers Association, “Record Number of Bank Customers Use Mobile Apps More Than Any Other Channel to Manage Their Accounts.”
