Banks offer various financial packages to cater for different stages in one’s life. Amongst the diverse accounts, you can start by opening a current account which is an account from which money may be withdrawn without notice. It is typically an active account catering for frequent deposits and withdrawals by cheques.
This type of account offers immediate liquidity (cash). More often than not, a minimum deposit is required as an initial deposit. However, you are not required to keep a relatively large amounts of money in the account. There are banks that pay interests on current account balances, albeit attracting a very low rate.
1. Cash is kept safely at the bank against keeping it at home, whereby you can easily maintain control over your expenses through the normal use of cheque books or cash withdrawals.
2. Another advantage is that there is flexibility associated with a current account as you can open more than one current account if you desire either in your name or jointly with the partner or spouse. Even withdrawals can be arranged to be implemented either jointly or solely. Due to this flexibility, you can open more than one current account and group expenses as follows:-
- Entertainment (including dining out; travel; gifts)
- Home and utilities (loan/rent, water and electricity, home, life, health insurance, internet, telephony)
- Day-to-day needs (including toiletries and grocery items)
- Transport and auto (including fuel, insurance, and license fee)
- Rainy day fund (including medical expenses)
- Children / Pets / Education / Sports
Although withdrawals can be done immediately, Banks always require that one keeps a minimum balance.
3. Another advantage is that bank statements are issued regularly and through internet banking, you can either opt to view the statement containing all the transactions in chronological order electronically or have a hard copy to be mailed at the requested address. In this manner you can easily trace all financial movements of your income.
4. Another facility offered by Banks is the downloading of the mobile application so that you can view the state of your finances at any time as well as effect payments on-line without the need to have to visit any Bank’s outlet.
5. You are an account holder now so you can also apply for debit / credit bank cards which can be used to withdraw from or deposit cash instantly in any of the ATMs located in different localities opened 24 hours a day, 7 days a week, without having to visit any Branch.
6. The credit/debit cards can be used to effect payments on-line of outstanding bills. Nowadays on-line purchases are all conducted through credit /debit cards. If you opt to make your purchases on-line, you have to be very cautious that the site from where the purchases are being done, is a genuine and safe site to avoid cyber-attacks and security risks.
Another point to note is that nowadays, instead of paying employees by cheque, companies are utilising the direct deposit facility whereby salaries and wages are deposited directly in the employees’ bank accounts.
Make things happen: open a current account (a basic bank account for your everyday money matters)
- to keep track of all financial transactions
- to have better control of your spent and thus enabling you to save
- to be your initial step towards opening other accounts (savings and fixed) leading to a good start to build your nest egg.