Automatic Saving Plan is a kind of personal saving plan in which the individual or the plan owner deposits a fixed sum of money automatically in their investment account after some regular interval of time. There is a typical fund transfer structure that an automatic savings plan follows. In this fund transfer system the funds or the specific saving amount is transferred from the bank account of the individual to the specific investment of saving account after a predefined interval of time say after every two weeks. For example when every month the employee receives a pay check from its employer the specific or desired saving amount is automatically transferred from the bank account of the employee to its saving or investment account.
There are a numbers of other advantages of an automatic saving plan other then automatically transference of money from the bank account of the owner to the savings account. One of the basic advantages is that you don’t have to manually deposit money from your bank account to the investment account. Moreover this type of system helps an individual to stick to their budget as it is hard to overspend or to neglect budget via this kind of system. With the help of this kind of system you cannot have a dip into your savings as they have been transferred from your bank account automatically.
In addition to the individuals this type of system also help investors in contributing to their investment portfolio as the money automatically transfers to the investment account of the investor.