Savings Account or Piggy Bank?

canstockphoto16725076For years the most popular way to save money was to open a savings account. However, in recent years people have decided to start using the traditional piggy banks to save their change. Which one do you prefer?

Recent studies have indicated that more and more people are now saving their money at home and stashing it in a piggy bank or other type of container and keeping it at home instead of depositing it into a savings account. Looking overseas, more than 23 million people in the UK alone are now keeping their savings at home instead of in a bank. Recent studies have also indicated that these piggy banks or other types of containers can contain over $1 million.

Most of these containers contain a larger percentage of small coins (pennies, dimes and nickels) however some of them contain larger coins such as quarters and half dollars. Most coin jars contain on an average of $100 or more. Many people started using piggy banks and such mostly because they don’t like carrying change all the time and think it’s an easier way to save money. An even larger percentage of people start their piggy banks because they either don’t have the time to make coin deposits in their savings accounts or think making such deposits is a waste of time since the interest rates are low.

Recent studies have also indicated that many people not only find piggy banks an easy way to save loose change but use them to save money for specific reasons. Many experts have commented that people who save change should be given credit. Back in the day many people would make the statement save the change and the dollars will take care of themselves.

It’s wise to start saving at any age and many people start savings accounts on the birth of a child to save for college or other reasons. Other people prefer to start saving money at the beginning of each tax year to take care of unexpected expenses throughout the year.

Before opening a savings account or starting a piggy bank there are a few things you need to consider. The first question to ask yourself is whether you want to start saving with a large sum of money or make small deposits. If you are opening a savings account consider what type of account you want to open such as an account with a fixed rate of interest.

For those that prefer the traditional way and want to open a savings account be sure to shop around for the best interest rate. You may also want to check out if the interest rate is compounded quarterly or annually since this can make a big difference in the balance of your savings account. Also consider what type of account you want to open such as a regular savings account, fixed rate, or even a checking account. Checking accounts may have less interest associated with them but they also are move forgiving if you are making multiple transactions each month. Savings accounts often will charge you fees if your transactions are over a certain number. Also be aware when ordering checks to not just assume the bank is the only location to obtain them. Often they are very expensive when others can be ordered elsewhere at a fraction of the cost and still have all the security features of bank checks.