A savings account, also known as a checking account, is a type of bank account where the user deposits money into a fixed account. It usually has no direct access to funds, instead, the money is held by the bank until it is needed. A savings account may be a joint account between two or more people. The name savings account came into use in 1920 when it was named after the Scottish savings bank, with the words ” Savings” and ” Account “in the name of Mr James Galt” being used to label the joint bank account. There is no current legal definition for the savings name but it typically refers to an account that is used exclusively for investment purposes and has no other banking services provided. A checking account is often confused with a savings account due to the checking on funds that occurs when one person requests a wire transfer from another person’s account.
DescriptionA savings account, as previously mentioned, is a banking service that allows its users to deposit money into a fixed account and earn interest on it. Typically, this is done by using a debit card or by utilizing a checkbook and may be accessed online banks. There are different types of savings accounts that allow users to choose the one that best meets their financial needs and preferences. They come in various forms and interest rates and may not be free, pre-paid or managed by the bank with whom the account holder maintains a checking or savings account. All banking services have fees and charges and the type of banking services offered may change from time to time.
Types of savings accounts The most common type of savings accounts is a checking account, which allows its users to write checks against a specified balance and receive payments and electronic transfers when payments are made. A savings account may also be referred to as a regular savings account, individual savings account, a guaranteed minimum account, or direct savings account. In addition to the checking account, there are two other types of savings accounts; savings accounts for individuals and credit unions. Credit unions are designed to coordinate expenses among its members. Meanwhile, individual accounts may be opened in any financial institution that offers savings accounts.
DescriptionThe structure of a savings account, as well as its features, depend greatly on its type. In a checking account, the owner or users have an account balance and a right to write checks against that balance. Checks drawn against the account are recorded and reported to the particular banking institution. Meanwhile, savings accounts have no account balance and thus no right to write checks against it. However, users may use debit cards or electronic check books to access funds from their savings accounts. They can also transfer funds to their individual checking accounts from online banks.
AvailabilityMany banks offer a variety of savings accounts, both local and online, with varying features and fees. Some banks offer higher interest rates and more flexibility than others. Additionally, some offer better services than others. For example, some offer free check printing and overdraft protection for selected transactions while other banks offer free checks, no minimum account balances, and paper checks for deposit and withdrawal.
High Yield Savings Account An emergency fund is probably one of the most important benefits of opening a high-yield savings account. An emergency fund allows a savings account owner to borrow money when an emergency occurs. If the owner does not have the cash on hand when an emergency occurs, then the option to borrow funds from an emergency fund may not be available. Thus, if an emergency should occur, savings account owners should consider having an emergency fund in place.
Accessibility Of Certain ThingsLike other things like certificates of deposits, savings account allows people to benefit from a number of features. Banks offer various services, such as check printing, electronic funds management, ATM use, and online banking. These services are available to individuals with high-yield savings accounts.
Accessibility Of Certain ThingsThe costs associated with utilizing these services is also generally higher than costs associated with standard banking. Fees for check printing, debit card use, and online transfers, among other things, are generally higher for high-yield savings accounts. However, the rewards of these types of accounts make them well worth the additional costs.
