LogFAQs > #950696722

Coloradough posted...

Well the typical answer I see from googling this question is "the savings acct makes you money!"

But an index fund makes you 5% a year and a savings account makes you 0.01% so surely there is another benefit?

Sounds like there's not though

Yeah, but you're talking about more than one comparison and conflating them.

A savings account is better than some kind of investment for emergency needs because it's more readily available.

A savings account is also better than a checking account for emergency needs because it's generally more secure.

It's about managing risk in both cases, but they're different trade-offs.

I recently had to cancel my debit card because I saw an unrecognized transaction in my checking account.

It's not a big deal... Except when it is. Like giant aspirins example. I mean it's not a big probability event but what's the downside of the savings account? It's not the rate of return if you compare it to a checking account

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Trying to dunk since July 2020