5 Reasons to Open a Savings Account Now
College students have limited finances, which may make them believe that there is no point in opening a savings account until after graduation. However, having limited finances means it is even more important to make smart decisions with your money. This article offers up five advantages to having a savings account while still in college.
A Dollar, In Time, Saves Nine
Bills to pay, meals to eat, textbooks to buy…where on Earth is a student supposed to find money or time for a savings account? That is something you won't really need till after college, right? Wrong! While it may almost sound silly, your college career is actually the perfect time to open a savings account for many reasons. Not only can it help your current financial situation, it can also help you out in your post-college future.
1. It Forces You to Save Money
This is probably the most important reason to open a savings account. While many students do not have a job, or have so little income they have nothing to spare at the end of the month, a savings account does at least initially save some money, since most banks require that a person deposit a certain amount of money upon opening an account. Some others even require that a further amount be deposited regularly every month! While the amount is usually low (around $15 to $50), it still adds up over the months and forces you to set that small amount aside every so often. Getting used to saving even a small amount every month is a habit you're going to want to have once your college career ends.
2. It Comes with Perks
Most banks would like nothing more than to rope in a college student, and because of that, the perks that come with opening a savings account are greater for you than they would be for someone who's already graduated. Savings accounts may come with higher interest rates, or something smaller and more material like a mug or keychain. Some banks even have special services for certain colleges, including on-campus ATMs or checks with your school's symbol or mascot on them.
3. It Gains You Interest
Even if you only make that initial deposit, leaving some amount of money in the account is only going to gain you interest over time. Just putting in $100 and waiting out your college career without even touching your savings account, you're going to end up with more money than when you started. And remember, the greater the amount in the account, the greater the interest is years down the road when you really need it.
4. It Teaches You How to Deal with Banks
Working with banks is just about unavoidable in life after college, and it's rarely fun. You have to know how to write a check, deposit money, use an ATM and monitor your accounts either online or by talking to a teller. While these things sound boring, they all have to be done in order to maintain a healthy financial status. Because college is all about learning, why not learn about these things now if you haven't already? The services just mentioned tend to be free for students, so the learning experience at least won't cost you a dime. Once you exit college, you'll be ready to manage your own finances and will understand how to interact with your local bank efficiently.
5. It Sets Up an Account You'll Need After College
We already noted that interacting with a bank is something you're going to have to do throughout your life. To take that a step further, you're going to need a savings account at some point, so why not now? Sooner than you think, you're going to start having to think about saving for a home, possibly a wedding or even children. Having a savings account now will give you a head start in attaining these things. The interest and experience you gain in opening a savings account will also help you later when you finally decide to spend that money on a worthy cause.
Need a little extra money? How about using your smartphone?