If you don’t have a lot of savings, you’re not alone; a GOBankingRates survey showed that 44% of Americans have $500 or less in their savings accounts. And data from the Federal Deposit Insurance Corporation (FDIC) revealed that in 2019, up to 7 million Americans were “unbanked,” meaning they had no bank account of any kind. so. If you just haven’t had time to open a savings account, it’s probably time to start thinking about it. While there’s never a bad time to do so, according to financial experts, there are particularly good times when you’ll have a better chance of saving.
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According to Brian Rellihan, Certified Financial Planner and Senior Financial Advisor at Wise Wealth Partners, the best time to open a savings account is today. “I strongly believe that saving and investing is a habit once you start.”
He said the accumulation of wealth has as much to do with the savings rate as with the rate of return on interest or investments. Each day of waiting corresponds to savings that you have not accumulated.
There’s never a bad day to start saving, in truth, and the sooner you do it, the faster you’ll accumulate that nest egg. However, as Justin Furniel, investor, banker and financial coach at Push and Profit, said, times have been tough for many people, especially due to the pandemic and rising inflation.
However, he said: “…There is a certain time of year when the overall challenge can become a bit easier to open a new savings account and start saving. And this time it’s during the summer.
He reasons that there is no gift-giving holiday right now, “So basically you have all summer to start saving without worrying about the next legal gift.”
Expenses, in general, also tend to drop in the summer, with the exception of holiday expenses, but you can also enjoy more free outdoor activities.
“So with little planning, summer really can be the best time of year to open a new savings account and start saving money for the future.”
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The new Year
Another great time to consider opening a savings account, according to investor Richard Latimer, CEO of Veritas Buyers, is during the New Year. “Most people have financial resolutions and most involve saving more. Opening an account in January can help with this.
He warns that while opening an account to save is a good step, it can be like buying a gym membership. “January may involve a lot of workouts, but February has less. Both are necessary first steps. Saving habits, however, are more consistent than gym habits; after all, no one needs to get out of bed. his couch to save.
Before your raise starts and before your tax refund
Brian Walsh, CFP and head of financial planning at SoFi, suggests the key times to open a savings account are before you know you’re going to get extra money from a tax raise or refund.
While a raise might seem like a good thing for your finances, Walsh pointed out that it can also have a negative effect. “If you simply increase your expenses, your standard of living increases, which prevents you from achieving financial independence. On the other hand, if you save most or all of your increase, it can really speed up your path to financial independence If you have a raise coming up, consider opening a savings account and directing as much of your raise into that account as possible.
The same often goes for a tax refund, which can be a large, easy-to-spend sum. “Getting a refund can be a great opportunity to build your cash cushion,” he said. “If you normally get a refund, rather than spending it, consider opening a savings account for the refund. This can be an easy way to increase your cash cushion and have a buffer between an unexpected event. and a difficult financial situation.
When you see a new banking offer or product
Walsh also recommends taking advantage of new savings account products at banks, which can come with “extremely competitive benefits.”
Keep an eye out for the bonus trap
Opening a savings account is never a bad thing, but Revenue Geeks co-founder Adam Wood warns you to watch out for short-term bonuses that expire after the first year. “Many savings institutions offer accounts that promise high returns, but only for a limited time. There’s nothing wrong with signing up for a bonus account, but note when the incentive expires and transfer your money then, or you may find yourself earning pitiful returns.
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