Useful information about savings

1. I cannot save money, for I have to repay my loan...

Even if you have a long-term credit, saving money is a good way of personal finances management, for one can never foresee all the possible expenses in the nearest future. Having both of your "personal balance sheet's" items - loans and savings - with the plus mark is a natural thing in the whole world nowadays.

Let's imagine that you are a member of a young family with monthly income of 700 LVL, but simultaneously as large expenses. You have got 20 000 LVL loan with 10 year maturity, for which you monthly repay 275 LVL.

What can you do? We offer you two variants.

• You can leave everything as it is and after 5 years you will still have to repay the 10 000 loan and will scarcely possess any serious savings.
• You can have the 15 000 loan to repay and 5 227 savings in cash.

How can you reach this?

What we advise is very simple: change the maturity of the housing loan into 20 years and sign the Deposit agreement for 5 years, investing monthly 80 LVL. Notice that your monthly payment will not change in the slightest - same 275 LVL. And your savings can be used for any purpose you want: repayment of the loan, apartment renovation, first payment for the car leasing, etc.
In the second variant the family forgets the fear of tomorrow.

2. Why save money, if one can faster repay the housing loan?

Repaying the housing loan and simultaneously making additional accumulation of money is a way of protecting oneself from unforeseeable incidents. Such an accumulation of means thus becomes the so-called "future insurance" against the short-term financial troubles.

3. Saving money asks to have a great discipline, which I don't!

The solution is Deposit. The bank monthly automatically transfers money from your current account to Deposit. Your savings will accumulate on the regular monthly basis.

4. My income is neither regular, nor stable!

The best choice for you is Savings Account. You can load your account any time with any sum of money. If your income becomes regular you can sign up for the regular standing order. The savings will gradually accumulate, which will enable you to invest money into the structured deposit or any other long-term instrument.