NuclearVision wroteHello everyone! Before starting I want to point out that I did search for the topic and couldn't find what I am looking for.
Over the last few months, I made my first couple thousands of dollars by some online freelancing, trading, etc. I am still a student, so i don't have a stable income.
I was thinking of starting saving in a bank, mainly because I am impulsive, compulsive when it comes to money spending...
But, I know nothing about banks, I don't even know if it's a good idea, I am thinking that starting saving now will improve my spending habits.
I know I can just walk into a bank and ask what I want to know, but I am more comfortable behind a screen with my current finance knowledge.
Ok so a few questions that come to my mind:
Is it a good idea to start saving IN a bank?
Is there a yearly fee for that given that I don't want any extra services like sms and cards...
Do I need some special documents for opening a bank account? (like a residency paper or other 20th century stuff)?
Will they give me interest? And Can i keep adding money to a 'frozen' account ?
What's in your opinion the best bank, keeping in mind the bank's customer support, branches availability and hidden fees, likelyness to collapse(?) ? for example, i head sgbl are kings of hidden fees.
Any advice or personal experience is also welcomed.
Hello,
I suggest that you start saving early on, and when you start working to get the habit of transferring x amount of your pay to saving account. in a couple of years, you will have a sum that generates an alternative income that you can use to buy stuff outside your income or as first payment for a car/house.
Basically, there are two types of accounts in banks that you care about, Current and saving.
1. Current account:
Can be in $ or LL. You can input output money in and out of it. You get a bank card (that you can use on the internet and ATM) and you can manage input/output money from app \ ATM without entering the bank.
Current accounts usually cost 1 to 3 $ per month.
There are many tiers which add benefit, like granting you points each time you spend using the card and increasing withdraw amount from ATM from 1000$ to 3000/5000$.
2. Saving account:
Saving account is putting money in an account that you can't withdraw whenever you like but in return you gain % of benefit (feyde).
Types (things you can pick from):
Currency --> Can be also in $ or LL. (interest rate is much higher on LL than on $ but it is more risky).
Maturity date --> can choose between 1 month, 3 months, 6 months and a year. This is important for tow things; 1) you can't withdraw from the saving account except on the maturity date (every 1 month,3, 6 or year). the higher the maturity time the better the interest but you lose flexibility if you need the money.
Interest --> Depends on many factors from most impacting to least; Currency (LL or $), Amount, Maturity duration, Bank.
Interest is usually on LL for reasonable amounts between (5 and 8%) and on $ (2 and 5%). Again varies with above factors.
What I suggest:
Go to bank and sit with them and ask them about anything you need, don't be shy. They are just people and is just a friendly chat.
You are the client, they want to win you as a potential for future. You can even negotiate better terms and special service with them.
PLAN:
Open a saving account with a bank close to your location (work or home).
Choose a bank that has online banking.
To open a saving account, you must open a current account with the same bank (that will cost you ~1$ per month + some fees).
Steps:
Open current account ($ or LL) --> open saving account --> put all the money you want to save in saving account during opening --> Choose maturity time of 1 to 3 month --> tell them to enable online banking for both account and tell them you want transfer money from current to saving online (cost ~10-15$).
When you get paid --> you put it in saving account --> transfer X money from current to saving online.
On Maturity date (every month or 3 months) --> you can withdraw the interest from ATM or counter, or leave it to accumulate.
Notes:
* If you choose a currency in $ or LL, you can input different currency but bank will take transfer fees, so better open account with currency you mostly get paid with and use.
* choose good bank that takes good fees for current/online-banking (1-2$ per month) and has the features you need. Saving account management is free, they take a % of your interest.
* A minimum of 5000$-10000$ is usually asked from big banks to open a saving accounts.
Good luck!