Where Can A Household Save Their Money? Reasons To Save Money In Financial Institutions


ґ Savings can earn interest: Financial institutions pay interest on money saved in their accounts. This means the amount of money in their account increases over time.


ґ It may help when applying for loans in the future: Regular saving builds a positive record with the financial institution. This shows the bank or credit union that the customer can manage money and may be able to repay a loan.


Types Of Financial Institutions


Type of Financial Institution Benefit of using the Financial Institution Commercial Bank


Commercial banks are privately owned institutions that can offer a range of deposit accounts to consumers.


Bank of Ireland, Revolut and AIB are examples.


Savers can manage their savings conveniently through online banking apps alongside their everyday current account.


Post Office (An Post)


An Post is owned by the government. As well as sorting all of our post, An Post also offers banking services including savings accounts.


Some savings accounts are tax free, so no Deposit Interest Retention Tax (DIRT) is charged on the interest earned, increasing the interest a saver keeps.


Credit Union


Credit unions are member-owned, non-profit financial co-operatives that offer savings and loan services to their members.


Because credit unions are not profit-driven, they may offer competitive interest rates on savings for their members.


If you are asked for a reason to save in a financial institution, make sure your answer is specific to banking.


For example, “they offer lots of services” is too vague. A better answer TOP TIP


would be “banks offer services such as online transfers, savings accounts or loans.”


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CHAPTER 5: Saving and borrowing for a household


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