In this article, I give you a quick explaination on why the Standing order is the best banking product. I mean the best after loans that are definitely in the first place. By using a standing order, we succeed in everything that is otherwise very difficult.
We discipline ourselves to save. We put ourselves first. We spend less than we earn. We save time and money. In short: a miracle product and I don’t know why it is no longer used and advertised.
When you take out a loan, the bank will usually issue you a standing order to repay it. This ensures that you do not “forget” to pay the loan and that they come first. Why not open another standing account and start saving / investing your money?
The thing is very simple. You come to your bank branch and say open for me, for example. open savings. It is a type of term savings where you can constantly top up your money.
You take a minimum of say $ 200 for three months. These savings will be automatically renewed every three months and interest will be credited to the principal. A classic example of interest on interest.
However, after you have opened a savings account, make a standing order for, say, $ 400 per month (or as much as you can set aside). In this way, you will surely save $ 400 every month, just as you will surely repay the loan to the bank.
This is just the beginning. For those who have more desires and maybe a little more money, you can open several different savings accounts.
Through internet banking you can rename them so you can have an account for for example car registration, holidays, financial freedom, new car, house, college, seminar, etc. etc. The limit is your imagination (and wallet).
Once you have opened all these savings accounts for certain periods of 3,6,9, or 12 months and put some amount on each of them and for them you can open standing orders and be closer to your goal every month.
The biggest beauty of all this is that you don’t have to go to a bank branch at all! You can open a savings account online and immediately open a standing account to transfer a certain amount of money each month. I don’t think you really have any excuse right now.
Another thing about why standing order is a phenomenal product is that you can pay ALL your utility bills through a standing order. No more waiting in lines at the post office (horror, they are constantly crowded on those days of the month) and at various counters and wasting time.
All invoices will be paid automatically and you will receive a payment slip at home stating that it has been paid by standing order. If you have paid your bills online so far – stop. For God’s sake, who cares to change the itchy call number every month.
In addition to saving and paying utility bills, you can also transfer money to investment funds, housing savings, life insurance, pay off credit card bills, pay rent taxes , send pocket money to grandchildren or students, transfer money from bank to bank and the like.
If you have problems with debts, for example by closing an annoying current account deficit, you can open an open savings account and put a certain amount of money on it.
The amount you calculated you could set aside per month. When you collect the amount of the minus, repay it at once.
Saving on a checking account or trying to spend less and less each month to reduce the deficit is a pretty bad idea and very difficult to do (I’m talking from my own experience). Help yourself with a standing order.
All in all, a standing order is a phenomenal and extremely useful product that should be used as much as possible.