Let us admit: not all of us are savings gurus. We visualize the goal, figure out the amount of money needed, and make a resolution to set aside some cash for it every month… But then, our determination gradually dies down, we lose consistency and soon find ourselves far behind our saving goal. You know the story.
Does it mean you are doomed to yield your goals to your inconsistency every time? No! All you need is to get your savings automated. Opening a savings account will keep you on track until you reach your goal. But the good news is that you can get there even faster if you choose a high-interest savings account. Follow us to find out how you benefit from automating your saving habit and a higher interest rate.
Why is automating savings so important?
Making savings for a long-awaited event, emergencies or, say, a retirement is a wise strategy. It helps us to always be ahead of the game. But when we are looking to cover the distance from point A (zero money) to point B, it’s crucial to decide what speed we are going to move at. A high and steady speed wins the race.
Your saving challenge is like a race. Are you moving at a steady speed or make deposits randomly, when you “feel like making a deposit”? A volatile mood is not the only hindrance on our way. Our everyday needs can eat up most of our earnings. So if you don’t secure a certain amount of money right after the payday, you have near-zero chances to cut through those needs and make a decent deposit later.
Benefits of automated savings
- Official means mandatory. When you automate your monthly deposits, you “officially” refer them to your monthly expenses. This commitment greatly reduces your temptation to skip the payment.
Still unconvinced? How about
- Peace of mind. Once you step into a monthly contribution program, you no longer ask yourself questions like “How much do I have to deposit this month?” or “When do I reach my final goal?” Because you know the answers.
- Lots of time saved. Once automated, “making a deposit” can be struck off your to-do list. You can focus on other tasks.
- More money saved. Making a deposit from your paycheck, not your leftovers, guarantees that more money hits your savings account every month.
- Reaching goals faster. When you decide to automate your savings through a savings account in Kenya, you can always go for the one with a higher interest rate. This means your money is not just being accumulated but also growing.
While developing your best saving plan, it’s important to define the pace that will be comfortable for you and your family. It’s up to you to decide how aggressive you want to be on your way to your savings goal.
There are several ways how your savings can be automated
- You can stay with your current bank and set up a deposit or a savings account there. Be aware of the bank fees (maintenance fees and minimum balance fees) and ensure the interest rate isn’t too low.
- Leverage your employer’s deposit (if any): this way, a pre-defined fraction of your salary goes directly to your deposit.
- Open a savings account at one of your local savings and credit cooperatives (SACCOs). The benefits here include higher-interest rates and a superior fee-free service.
How to open a savings account with a high-interest rate?
The rule of a thumb says that you find higher-interest rates online. So if you are looking for a real speed-up for your savings plan, consider opening an online-only account. MOMBO SACCO offers the most competitive interest rate of 6% on your monthly deposits of minimum KES 3,000. No maintenance fee is applied, so you can be sure no shilling is lost from your savings. Enrollment is simple using the MOMBO App or through the website.
Automating your finances, start with modest feasible monthly deposits. Later on, you can increase your monthly commitment once you are doing well. Usually, 10% of your paycheck is a comfortable and efficient pace of saving.