19 Mar The Art of Saving: Selecting a Bank
Why should we save? For the rainy day? The dry day or the temperate one? Reality is that despite the proverb prodding us to save for unforeseen (bad) moments, saving is actually a very deliberate systematic habit for well thought out, very clear plans and projects.
After determining the amount we would like to put aside and the intervals to save, it is really easy for one to be put off by the plethora of banks around. This article offers one key insights not only to help make that choice but also to make the most informed and beneficial one. Below are key queries one should raise.
He banks you are interested in being in existence? It is only natural that banks with longer years of business, would not only have better experience and many assets to buttress their brand (fiscal properties) but would also have lesser likelihood of folding up as their huge clientele and public trust is an asset on its own. In Africa, the likes of Barclays, Standard Chartered, Standard Trust and Ecobank have carved this reputation for themselves.
We all have varied reasons for using a bank; some for running a business, others for out and out saving, others, as a means to have a running hub for investments and yet others for having a hold on forex. Whatever your purpose is, it is best researching on which banks offers which service and the possibility of making profits whilst at it e.g. If one intends to open an account for running a business, then a current account is the way to go. But most banks give zero interest on a current account albeit a few do and these give a really small interest at the end of the year.
If your key priority is to apply for a loan, then it is important analysing the base rate (the amount of interest charged on loans). This can be gotten from business and financial magazines or by interacting with a customer care personnel. The lower the base rate, the lower the interest charged on loans and the easier it would be repaying them. If your key priority is not to get an instant loan, it is also worth keeping this at the back of your mind especially as a young person- You never know when you might need a loan.
Interest on Savings
Everything we do with our finances should be beneficial to us. Grill the customer care personnel or the liaison officer about the interest rate on all account types- it is your right to do so. Naturally, higher interest rates no matter how insignificant they may seem in comparison should be the better option- finances is all about numbers and you would be amazed what 0.5% can contribute.
Banks have lots of hidden charges “here and there” to make their profits. ATM usage charges, ATM issuance charge, Cheque book issuance charge, ATM extra usage charge etc. It is key to enquire about all of these and make the right decision that would be beneficial to you. Usually banks are quite flexible and you can drop one or two options that would make you maximise your savings e.g. For most banks, you can opt for a current account and not pay extra for going beyond your monthly withdrawal limit or, you could scrap the ATM business as a whole and opt for the traditional withdrawal “over the counter”.
After perusing through all the above factors, it is necessary to pick a bank with a branch within reach. This is not only due to security and convenience but also economic reasons. It makes no sense whatsoever getting a bank that will not only make you spend a huge chunk of your time in reaching but also quite a considerable amount on transportation. This factor can be ignored though if you are a salaried worker and your wages or salary is directly paid into your account.
There are lots of gains one can get from having a bank account so one must try to exploit the opportunity as much as possible. Look out for promotions, temporal incentives, ease of forex transactions, charges on forex transactions, Technological advancement and convenience of paying utility bills.
It is important to state that all these factors shouldn’t be looked out in isolation. They are all interwoven and are synergistic in operation. One must thus look at them as such, properly peruse them and make a concise, precise and informed decision to aptly effect the decision to save.