Having a savings account to put money aside will help you take control of your finances. Putting a few pounds aside every month will help you be more comfortable and will come in handy if you ever have to cover bills and expenses you didn't plan for. You can also use your savings account to put money aside for a new car, a deposit on a house or to go on vacation, just to give a few examples.
It is important to compare different bank savings accounts before opening one since the cost and advantages of having one of these accounts vary in function of the bank you select for your savings account. Take the time to do some research to select a savings account that will be convenient to use and that offers a good interest rate. If you already have a checking account with a bank, you should consider opening a savings account with the same bank. This is the most convenient option since transferring money from your checking account to your savings account will be quick and easy. Transferring money to a savings account opened through another bank might take a few days. Using the same bank for all your accounts is a convenient choice since you will be able to access and manage your accounts from the same online banking tool and might be able to set up automated transfers to your savings account.
The interest rates and fees are other things you need to consider before opening a savings account. The interest rate will determine how much money your savings earn as long as you do not withdraw them. You need to look for a savings account with a good interest rate but should not select an account with a high interest rate if the fees associated with the account are higher than what another bank offers. Look for bank savings accounts with the perfect balance between a fair interest rate and reasonable fees. You should also ask about the minimum balance you need to maintain in your savings account since some accounts might not be a good fit for the amount you plan on saving.
Be careful not to choose PPI cover when you do sign up for your savings account. Payment protection insurance is very different to normal insurance and generally isn't needed by most people. Check out PPI Guru or other websites like 'Money Saving Expert' where you will find more information about the pitfalls of PPI.
Take the time to compare your options. Start by contacting your current bank to ask about their savings accounts and contact other banks if you want to compare interest rates and fees.
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