Many people under the age of 35 today don’t believe that they need a savings account. The tradition of having both a savings and a checking account has fallen out of favor with younger bankers, and it has led to many of these bankers not being prepared for emergencies, major purchases, or other financial needs.
Here are just a few reasons why you need a savings account, regardless of what you may believe:
Coverage in Case of Emergencies
What would happen to your home or family if you or your spouse was laid off from your job? What about a natural disaster or other major catastrophe? How about a medical emergency that left you thousands of dollars in debt or in need of expensive medication or surgical procedures? These are all very real scenarios that happen to average people every day – and which can be made a little less severe with the insurance of having plenty of money in savings to cover the costs.
Funding Major Purchases
Are you thinking of buying a home or a car? What about putting in a pool in your family’s backyard or going on a big vacation this summer? These are all good financial goals to have a savings account to cover.
Protecting Your Money
Did you know that there are some savings accounts where you can keep money tax-free? It’s true. These accounts, known as tax-free savings accounts or TFSA accounts are a great place to keep a chunk of your savings to prevent having to pay taxes on the withdrawal. Even if you earn interest on your money, you won’t be taxed for it!
To learn more about Kamloops TFSA account options and find out how to save and protect your family’s funds for a rainy day, talk to your nearest financial planning professional today. They can help you establish a good plan for the coming year to get you started saving – and reaping there benefits thereof.