Benefits of High Interest Savings Accounts

Those who avail themselves of the high interest savings accounts now offered by most banks and other financial institutions need to watch that fine print to see what features their account offers. Some features can be considered less than beneficial when you could lose the high interest offered if you either don't make regular monthly deposits, or if you withdraw.

But if you really think about this, it could be seen as s benefit. What of the impulse buyers who has difficulty in restraining themselves from making purchases that are not strictly necessary. If they could access their money with no penalty they would be sure to do so. Instead, they will be forced to think again before they withdraw. Do they really want to lose that high interest rate that attracted them in the first place? Even losing it for one month will bring the balance down considerably.

They may think to get around this problem by not depositing that extra $10 or $20 at all, preferring to keep it in hand 'in case' they need it. And they are certainly to 'need' it when they see that special something in the shop window. But if they know their high interest will drop through no deposit going into that account, then they will be highly motivated to save instead of spending. So in no time they will develop the habit of regular saving.

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