Sarah Toffoli: Hi! I am Sarah with Wells Fargo & Company. Today we're going to take a close look at the basics of saving money and how it can have a very positive impact on your financial future.
Think of saving as giving a gift or paying a reward to you. Saving money is a key to financial independence and building wealth. A savings account will allow you to deposit money from your earnings or other sources of income.
One of the key benefits of a savings account is that you'll earn interest on the money you deposit and keep in the account. Your savings account will also give you a place to withdraw funds when you need them. Most people use their savings account to put money aside for a future goal or emergency fund.
Traditional savings accounts allow you to add money in the form of a deposit or to withdraw money. There could be limits on how many withdrawals you can make each month or statement cycle. You may be required to keep a minimum balance in the account to avoid fees. Interest is paid either monthly or quarterly. Traditional savings accounts are FDIC insured up to applicable limits.
Building up huge amounts of savings won't happen overnight. But it will take place if you make it a habit, make it automatic and stick with it over time. The money you save gives you so many benefits like cash in an emergency and the ability to buy big things like a car or even a home.
A great place to save is a traditional savings account. It helps your money grow with interest. Compounding is a powerful way to make your money grow faster. The higher the interest rate and the longer you will leave the money in the account, the more interest you receive.
Savings is an important investment in yourself and your future.