Forced Savings Accounts

While forced saving doesn’t sound like much fun, it is important to remember why you are saving, and why you need to be forced to do it, perhaps you are a notoriously bad saver and always dip into your funds before you reach your goal, or maybe you just get distracted and put off making deposits to your savings account in lieu of other immediate purchases, instead of saving up for something bigger and better. No matter what the reason, forced saving doesn’t have to be painful at all, as there are many high interest savings account which are aimed at forcing you to save either with restricted access, bonuses or rewards.

Who Could Benefit From a Forced Savings Account?

So now you know that the funds aren’t actually going to be forced out of you and that forced savings accounts really only want to help you reach your savings goals, are you one of the people for whom a forced savings account was designed? Perhaps a forced savings account is exactly the savings tool you have been missing in your financial arsenal.

You could benefit from a forced savings account:

• If you can’t seem to stick to a savings plan or even find a savings target which motivates you. A forced savings account helps you to save because it knows all about you, when you open the account you will be asked to enter your savings goal and your savings deadline. Your savings account will then track your progress and show you just how far you’ve come and how much further you have to go before reaching your goal, seeing your savings mapped out allows you to see that your weekly contributions aren’t pointless sacrifices, but are actually going towards your goal, and making a difference.
• If you don’t think you earn enough to save up for your goals, so you don’t bother. It’s easy to wonder at the point of putting away as little as $10 a week towards a savings goal, because it can seem like you’ll never make it, this is why you need to be forced to save. It doesn’t matter how much you contribute to your high interest account, as long as you do it consistently and regularly you’ll be earning interest on your funds, and earning compounding interest, or interest on your interest, and this means your savings will reach their goal.
• You need help developing savings habits and don’t know where to start. You may not have a specific savings goal in mind, but you know you need to save. Perhaps you are a teen or student who wants to start to secure their financial future but you don’t know what that involves, or maybe you’ve had a rocky financial road and you’re looking for the path to security, whatever the reason, a forced savings account which offers you high interest and a simple savings plan is the place to start. You’ll learn about the importance of regular contributions, you’ll see the difference a high interest rate can make to your savings and you’ll learn about delaying your spending until you can afford the purchase, rather than spending on credit and paying for it later, over and over again.

What is a Forced Savings Account?

Forced savings account is a term which can be applied to any savings account which actively tries to make you save, and limits your access to your funds, forcing you to leave your savings in your account until you reach your goal. So if you think your finances could benefit from some enforced savings guidelines, these are the features you should look for in a high interest savings account.

How to find a forced savings account:

• Compare all Australian high interest savings accounts to find the features you would like. Using the Savings Account Finder™ comparison tables to learn about the features, promotions, benefits and bonuses of high interest savings accounts allows you to familiarise yourself with the basics of the account type. This means that when you choose from the range of forced savings accounts, you know which other features you’d like your forced savings account to have too.
• A forced savings account will inspire and motivate you with bonuses. In order to force you to save, your savings account will reward you for your efforts and in return for saving you can receive bonus interest on your funds. This is just one way your savings account will force you to save, and it means that you in turn force yourself to save, quashing the urge to withdraw funds for a frivolous purchase, knowing that if you force yourself to save and not spend, you will be rewarded.
• A forced savings account will penalise you for not saving. If you think you would be more motivated to not make a withdrawal from your savings account if there was a tangible penalty, then choose a forced savings account which will pay you a reduced rate of interest on the months when you make a withdrawal. When you compare the months you made a withdrawal to the months you didn’t, you’ll see a significan’t difference in the interest earned, and this is an important tactic to force you to save, rather than spend.
• Choose a savings account which automatically makes deposits. If automatically moving your funds to your savings account each payday sounds forceful, it is an effective way to force you to save. If you don’t have to manually move your funds to your savings account each time you are paid, then there is less chance that you will be distracted, lose your motivation or just forget to make the transfer. Instead, your forced savings account can automatically take a contribution each payday, before you even notice it’s gone and by setting up this automatic transfer you can pay yourself first, forcing your savings to grow each week.

Forced savings is not painful if you find the right savings account for your needs, knowing your financial weaknesses before you start your savings plan allows you to plan for ways to navigate around them, rather than giving into them. Knowing what you are looking for, you can use the Savings Account Finder™ comparison tables to help you choose a forced savings account which best suits your strengths and your weaknesses, and you can sign up online via our secure links, in less than ten minutes, before you have a chance to change your mind!