IS THE SAVINGS ACCOUNT STILL WORTH IT?
Surely many still know the times when you brought your saved money to the bank.This was then paid into their own savings book and there was also a small gift. But is the savings book still worthwhile as an investment these days? After all, most savings accounts now earn little or no interest at all.
THAT SPEAKS FOR A SAVINGS ACCOUNT
- Relatively quick availability of the investment
- protected by deposit insurance
THAT SPEAKS AGAINST A SAVINGS ACCOUNT
- Currently no to very low interest on savings
- Numerous alternatives with better interest rates
- No inflation protection
- Possible effort to withdraw money or cancel savings account
DISSOLVE SAVINGS BOOK? THIS IS HOW YOU CAN CANCEL YOUR SAVINGS ACCOUNT
In order to terminate a savings account and initiate a payout, in most cases it must be in writing and signed; the banks will be happy to send you the relevant form. You can send the cancellation by post or, alternatively, go to the bank branch in person and clear the savings account. You can transfer the amount you saved to your current account or even have it paid out. You can find out whether your savings account can also be terminated by email or other means in your contractual documents with the bank.
TIPS FOR CANCELING YOUR SAVINGS ACCOUNT
In order to terminate your savings account, the termination should contain at least the following information:
- Recipient (name and address of the bank or the responsible bank branch)
- Sender (your name and address)
- Date of termination (current date)
- Subject (for example: “Termination of savings book with account number …”)
- Details of the savings book (account number or details for clear allocation / savings certificate)
- Cover letter (text in which the termination is expressed. Example: “I hereby terminate my savings account (savings account number) as soon as possible / on DD.MM.YYYY (desired date). Please confirm my termination.”
- Account details (the bank details of your current account to which the savings account balance is to be paid out. This includes details of the account holder and at least the IBAN number)
- Handwritten signature (your own handwritten signature at the end of the letter of termination)
NOTE: If you want to be safe, it is necessary to send the cancellation in writing and signed by post (registered mail) to the bank. If you still have a “real savings account” in book form (and not just account statements), this must be included with a corresponding note. If you follow these instructions, clearing the savings account is not a hurdle.
What is advance interest on the savings account?
If you want to cancel your savings account before the notice period expires, so-called advance interest will be charged. According to legal regulations, this fee is 25% of the interest that you would have received for the remaining term and the remaining balance in the savings account.
NOTE: Since the interest rates on savings books are usually very low in the current environment, the advance interest is usually very low. In addition, this only comes into play if you want to dispose of the credit before the period of notice has expired.
What are alternatives to the savings book? What to do with the credit?
The question now is what the possible alternatives to the savings account are. Ultimately, the aim should be that the amount saved over the years does not lie idle in the current account without interest. The constant inflation also threatens a constant devaluation of the credit. Below you will find alternatives for investing the savings after closing the savings book, possibly more sensibly.
- Daily and fixed deposit
- Stocks and equity funds
How can I close my savings account? Should I have the savings paid out, should I invest it elsewhere, or should I leave the savings book in place? If you want to find out more or cancel your savings account directly, the following points can be noted:
- In times of low market interest rates, there is hardly any interest on savings accounts
- The credit in the savings book is usually available relatively quickly
- If you want to cancel the savings book, we recommend a written cancellation by letter as registered mail or in person at the bank branch, depending on whether you prefer a payout or a transfer to your current account
- Savings plans can be alternatives to the savings account. For example, based on selected stocks or funds. Real estate or other forms of savings can also be an option.