Various Types of Savings Accounts
Undoubtedly, most of us find it difficult to save money these days. However, it has never been more important to put a little bit of money aside each payday so that when financial emergencies occur we will be prepared. A savings account is the ideal vehicle for preparing for that proverbial “rainy day.”
Most people prefer to have their savings account and checking account at the same bank. This often makes it easier to make deposits and withdrawals into the savings account. It is also quite easy to transfer funds from one account to the other. Electronic transfers can easily be accomplished using a computer with internet access.
The most important part of a savings program is to save regularly. It is often better to deposit small amounts each payday than to put away a large amount only to have to dip into your savings for daily expenses. There are few of us that cannot afford to put aside $10 or $20 per week. Deposit it into your savings account before you write that first check or make your first ATM withdrawal. Think of it as paying yourself first. By the end of a year, that $20 per week will add up to be over $1,000. Now fast forward to ten years from now. That simple $20 per week will have grown to over $10,000. That is a nice nest egg.
There are various types of savings accounts. The most common type is known as a passbook account. Even though most banks no longer issued actual books to record savings account transactions, the name has stuck. These savings accounts are more accurately referred to as instant access accounts. These accounts are best for account holders who may need quick access to their funds. The interest rate on this type of account is generally lower than on some other types of accounts.
Offering a little better interest rate are notice savings accounts. The downside to this type of account is that account holders are required to provide notice before making any withdrawals. The amount of notice may vary from bank to bank.
A regular savings account is designed for those individuals who can commit to making regular deposits into a savings account. These accounts usually require a prescribed number of deposits must be made or the account will lose the more attractive interest rate. In some cases, the account may even be closed. Financial institutions may reward these accounts with an annual bonus in addition to their higher interest rate. Withdrawals may be limited. For this reason, individuals who may need quick access to their money may want to consider an alternative account.
There are an unlimited number of banks who provide savings accounts for their customers. Finding a bank that will allow you to open a savings account is easy. The difficult part is in finding the bank that will pay you the highest interest rate and still allow you access to your money when you need it. We have researched a huge number of banks across the nation. On our website customers can find rates, rules and even customer reviews for various banks. Check out our information on savings accounts and get started saving today for your future.