Is having a savings account worth it?
We all pretty much have to have a checking or current account nowadays, but a separate savings account is not always necessary - it depends on your behaviour. Some points are relevant:Savings account(s) can be good for setting aside different pots of money for different purposes.Savings accounts tend to offer marginally higher rate of interest (although it’s all rather tiny at the moment).If you need the discipline of having your money in a savings account, rather than psychologically more accessible in your current/checking account.If you have larger sums of money, you shouldn’t keep them all in one bank - have a couple of accounts.Very long-term (20+ years), savings just about keep pace with inflation (that’s only if you get best interest rates and minimise taxes etc.), so likely to lose via inflation and huge opportunity cost of a saving account vs. investment.Sometimes cash is king - don’t invest too much money. Lots of cash puts a nice wedge between you and financial poverty. Cash can be deployed at favourable times.Hope that helps
How much money do you save on a regular basis as a percentage of your income?
I save and invest almost 70% of my small salary. I show all about my finances and investments on my blog From cents to retirement You can copy my strategy at your own risk.I live in central Europe and I make €50K/y. From this, I end up bringing in about €2400 (or $2600) after taxes. Since January 2016, I've been saving up €1600 every month, i.e. about 67%.How I do it: The salary hits my account and I automatically transfer €1600 to my savings account, so I forced myself to live off the rest. Rent is €385 which leaves another €375 to live off. Tough? Yes, very. See below why I do it.The reason I am doing it: I was diagnosed with the Chronic Fatigue Syndrome. It is not that I will die from this, but it is quite likely that I won't be able to work for more than 6-8 years, starting from now. My parents will be there for me if I need to, but I have a brother and I honestly don't want to be helped more than him. My plan is that I achieve financial freedom at 33/34 (Goal), and thats why I've been saving up as much as I can. I invest every single euro I save, primarily in Real Estate, and I hope I'll get my monthly expenses covered with 80% of the rent of all my properties when I am ready to retire. Till then, the rental cash is re-invested (primarily used to buy more properties and a careful dividend stock that I am planning on right now).How is it so save almost 70% of my salary: Not different than saving 60% or 50%, or even 40%. At the end of the month you don't really think about how many times you've eaten out, how much money you spent on clothing, etc. I've been always saving up a big part of my salary/grants, so I am kinda used to it. However, I presume that not everyone would take it as easy as me: I've been to 29 countries, I've been to expensive restaurants, I have no desire to have expensive cars, and I've made more than the average 60-year person has. I am willing to keep my expenses well below my income, as I know I will benefit from it in the future. So, in one word, it is comforting, because I know I will be financial free in the future.Follow me on Quora for more.