You cannot do without savings. You need to have some capital on hand to be able to make major expenses. Saving money won’t make you happy, but it feels good to have something on hand. In the Netherlands you receive a monthly income. Normally these are earnings that you receive in connection with performing work. We also need this money every month to make ends meet. Situations may arise in which you lose some or all of your income. In that case, we can rely on the safety nets in the form of social services. However, the income from this is low, and they often only provide basic services. In order to be able to make ends meet even in bad times, it is wise to build up a savings capital.
Does money buy happiness?
Money in itself does not bring happiness. Financial worries can make you unhappy. People who are struggling financially must carefully consider what they are going to spend every euro on. Having debts makes life very difficult. Families must continue to ensure that they continue to pay the fixed costs, otherwise they risk being evicted from their home. Families that do not save, but can barely make ends meet each month, will run into problems at some point. Major costs will arise. This could be a broken washing machine, car (which they cannot live without) or overdue bills.
Does saving make you happy?
Having a savings buffer can give you a safe and happy feeling. People who have gone too far in this way are the misers. These savers do everything they can to economise and save. Being frugal with money has simply become a way of life for them. They will never have enough money, because they can always do more. Savings should be used to increase happiness. You can’t just save without reaping the benefits.
How much savings should I have on hand?
To determine this, Nibud has placed a buffer calculator on its website. By answering a number of questions about your family situation, you will receive buffer advice from Nibud. For a family with children, a buffer of at least 10,000 applies. The amount they recommend depends on several factors. The size of your buffer will largely depend on your financial capabilities. Not everyone is able to build up 10,000 or more in capital. You must have the monthly resources for this.
Which bank is best to open a savings account with?
There are dozens of banks with many different savings accounts. Savings accounts can be roughly divided into two types, namely savings accounts with and without restrictions. You will receive the highest average savings interest on accounts with restrictions. The restrictions can also pose a major disadvantage. For example, a limitation is that you have to deposit an amount between 50 and 250 every month. Another savings account has the limitation that you have to pay one or two percent in costs when making a withdrawal.
Choose a bank based on the savings interest rate
It is best to deposit your money with a bank that pays a reasonable interest rate. You cannot aim for the highest savings interest rate, because it will often fluctuate. You can assume that a bank that now provides reasonable compensation will continue to do so in the short term. If interest rates fall, they will also fall, but competing banks will also have to lower savings rates.