To know whether you need both a checking and a savings account, there are some factors you must consider. Generally speaking, most people find it advantageous to have both at their disposal for all their financial transactions. Each serves a unique purpose in how you can conduct your banking activities.
Why You Need Bank Accounts
Some kind of bank account is certainly necessary since you don’t want to keep your money under the pillow: it is risky because of robbery, burglary and simple accidents – such as fire. Furthermore, a bank account is required if you have checks to deposit, such as paychecks, tax refund checks, etc. If you don’t have a bank account, you would need to cash these checks, paying a huge fee at some check cashing stores. Finally, many payments such as utility bills, credit card bills, etc., can be made for free through from your bank account. This is a lot faster and safer than visiting the physical branch and paying in person in cash.
Checking accounts allow you to write checks and use bank debit cards or check cards. This is very useful since it is much more convenient than carrying cash at all times. For this alone, it is certainly worth having a checking account. You can also use automatic debits to have recurring monthly payments withdrawn from your checking account. This way you will not forget to pay bills and be charged late payment fees.
Savings accounts allow you to get some interest on the money you keep at the bank. The interest is so small for savings accounts that it may not be worth your time, but you can always compare high interest savings accounts to see if there are any current promotions that could net you larger gains. Another benefit is that many banks allow you to have a free checking account in return for opening a savings account and setting up a small monthly transfer from checking to savings. Overall, savings accounts are less important than checking accounts but since it costs nothing to open, you might as well have one. A regular saver account will go a long way these days.
These days, it’s rare to find people who don’t have a free checking account or savings account. They definitely make life easier when you need to conduct day to day financial transactions without the restrictions of cash. Some banks even offer customers the ability to get money for opening a checking account. There are truly no excuses not to have one after that, it’s even more helpful when you have no cash at all.
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