When we are still starting our journey to financial literacy, the first route that most of us took was to put our savings in the bank.
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| "silver-and-gold-coins" by Pixabay is licensed under CC0 |
Banks offer a wide variety of investment vehicles. But the typical Pinoy, when starting, will open first a regular savings account.
This is not a wrong decision if the goal is liquidity, where you can access the funds anytime. But if the purpose is to have your capital earn interest, then a regular savings account will not make the cut.
In order for you to appreciate the interest earned from a regular savings account, you need to deposit a large amount. However, the goal of opening an account is to build your habit in saving. And once you are ready, you can then invest to other high yield investments the bank has to offer.
In this article series, I will list the interest rates of a Regular Savings account offered by 10 known banks in the Philippines.
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| Regular Savings Interest Rates Offered by Banks |
As you can see, 0.125% interest per annum is next to nothing if you are just depositing a small amount. To put it into perspective, for the interest to reach at least Php 1,000, you need to deposit Php 1,000,000.
Click here to use the Annual Compound And Simple Interest Calculator to calculate your interest earned overtime.
As you are just starting the habit of saving, a regular savings account is good first step. But once you gain knowledge financially, you must venture out to other investment vehicles if you are hoping to grow your wealth.
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