The Value of Having a Passbook Savings Account

I was analyzing my savings patterns this year and I came to the conclusion that I really needed to get into the habit of saving more regularly. Fortunately, I came across this bank named China Bank Savings near the condo where I live that is open from Mondays to Sundays from 10 AM to 7PM. Because the bank is open until the evening and even on Sundays, I decided that this bank is very convenient for my needs because I can always go there after office hours and on Saturdays or Sundays to deposit my money. So I opened a passbook account there.

Why a passbook account? As I was analyzing my spending patterns, I realized that it is hard to save using an ATM account because it is so convenient for me to go to any ATM and just withdraw money. True, the ATM will give you a printed receipt of how much you withdrew and how much is remaining in your bank account. However, it is really so tempting to withdraw 200…then another 200…then maybe 500…until you realize that your maintaining balance is so dangerously low already and you’re on the brink of losing the account. Because of this, I chose to open a passbook account at China Bank Savings instead.

The value of having a passbook savings account is that you will always know how much exactly you have in your account at any given time – all you have to do is open your passbook and there it is printed out for you. You also get to see how much you keep depositing or withdrawing over time by glancing over the past transactions. It is also harder for a thief to get money from your passbook because he/she would have to present proof of identity, meaning the bank staff won’t allow the thief to just get your money just like that. (With an ATM card the thief can use your PIN to get all your money right away.) A passbook is also a good way to prove capacity to pay for other financial transactions such as when you open a postpaid cellphone account at a telecom service provider.

When I opened my passbook account at China Bank Savings, I had to present 3 valid IDs (in my case I presented my SSS, PWD, and TIN ID cards). This allowed them to see that I have a good record as a citizen of the Philippines. It also helped that I had owned a passbook account at their head office in Ayala Avenue, Makati before (though that account was eventually closed). So they just asked me to sign different documents and within an hour I already had my valid passbook.

I have the habit of going to this bank regularly to deposit my money. For example, after I am done with my tutoring job my student pays me right away so I go to the bank to deposit the payment. That way I am not tempted to spend on anything. Because I did this consistently I was able to accumulate enough money to invest into that Sunlife mutual fund that I opened with help from my Financial Advisor Sasha So Seng Yu. So I know that my system really works because I was able to save a lot of money over time. I conclude then that having a passbook (as far as I’m concerned) is a good way to keep track of your savings, so much so that you can accumulate enough funds that you can then choose to use for big expenses or to invest (depending on what and where you believe your money should go to).