IMPORTANCE OF HAVING BOTH SAVING ACCOUNT AND A CHECKING ACCOUNT

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Nowadays people have multiple types of bank accounts like, checking account,savings account, investment account, spending accounts etc. People keep these types of accounts according to their personal needs. Now the question is , is it necessary to have multiple accounts like many people does? It is up to you that how many accounts do you really need. But if you are
Before we head to the importance of having both savings account and checking account, we should know first about both of these accounts clearly.

What is Savings account?
Savings account can be stated as the account where you save money for short-term, mid-term, and for the long-term depending upon your need. People use savings account to save up for things like vacation, festival, gifts, or somtimes for longer-terms item like, a wedding, down payment on a house, car etc.

What is Checking account?
Checking account is the account where all your money get deposit every month. You can take your checking account as the backbone of your financial system. All your money first go to your checking account than get filtered to different account like saving account, investing account, emergency account, spending account, etc. wherever you want. In checking account you can deposit money and also can withdraw the money using debit cards, checks, and online payments.

Why you sould have both checking account and savings account:
Talking about the differences between checking account and savings accounts , savings accounts technically pay you more interests. But the most important difference between these two accounts is that you frequently use your checking account like you can regularly use it to withdraw money, but you rarely withdraw money from savings account. People use checking account for frequent withdrawals as you are provided with debit cards and ATM for your convenience. But people treat saving account as a goal. Because every cent of saving account is saved for some specific items like a house, a vacation, car and even an emergency fund.
Now you may think that which account will be better for you. You should have both the accounts in two different banks. Having two different accounts in two different banks psychologically help you to grow your savings. You should deposit your money where you have saving account and you should withdraw money from where you have checking account. You might get anxious to know the valid reason. The reason is as simple as that if you spend all your “spending money” and there is no money available on your checking account but now you need more money for a go out with your friends, you will immediately transfer few amounts from your savings to your checking account. But having a seperate account always reminds you about your long- term goals and just don’t let it blow out of your mind. As a result you don’t waste savings on small things and focus on letting it grow. Another question might come to your mind that,”if I have only few money in my savings account, then what would I do by saving them? Rather I can spend them as it is too less to save.” But it’s not just about your immediate earing or how much you have saved. It’s about building the right habit. The perfect time to develop your habit is when the amounts are small. With right savings account, automatic savings and investment you should build your habit so that your habit become rock-solid when your income increases. Though this habit doesn’t seemed effective when the amount is small, but it will start matter when your savings will grow from 0 to millions.
Therefore always try to have both these accounts in two different banks to stay consisted with your savings and to make proper use of it when make a lot of money.

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2 thoughts on “IMPORTANCE OF HAVING BOTH SAVING ACCOUNT AND A CHECKING ACCOUNT

  1. Sekret Natury

    Insightful piece

  2. Rozpocznij teraz

    Outstanding feature

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