Most people are only slightly interested in the general idea of saving and having a “safety net” for the moment when the dark times come knocking, but not a lot of them are actively involved in this process, nor they feel confident in their self discipline and the ability to deposit amounts on a steady and regular basis. People all over the world are experiencing this psychological dilemma and they often ask experts for help, even though the real problem, and the subsequent solution to the problem, lies only in the minds of those people. However, a very simple tool is available to people who are interested in making this step, and they can save money easily with this solution. The answer to their problems comes in the form of savings accounts, and this product is available in almost any bank in the world.
Types of accounts
Savings accounts are one of the two or three main types of accounts, and they are different from checking accounts because of several reasons. The most important of them is the fact that savings accounts include interests on the funds, and also that the funds are not so easily accessible. Savings accounts are usually used by people who are interested in making regular deposits without frequent withdrawal, since this activity is reserved to checking accounts as they allow regular transactions and different types of money transfer activities.
Also, saving accounts are not the same as CDs, or “certificates of deposit”, which present the money that is deposited into an account but it cannot be “touched” until it runs out of it maturity date. To put things in simpler terms, CD money is deposited under a good interest rate by the bank, but it cannot be withdrawn until a certain period is over. Usually, the maturity date for these accounts is three or five years, but banks and customers can agree on almost any given number.
Savings accounts from CDs
Savings accounts are different from CDs because money can be withdrawn, although this process takes a bit more time than with standard checking accounts. Also, savings accounts have slightly lower interest rates, but this largely depends on the bank. There are number of elements that an average customer needs to know before opening a savings account, and some of those tips and tricks are largely connected with interest rates. They are probably the most important thing when it comes to savings accounts, and people should always check if the bank offers higher or lower interest rates. The higher = the better, of course!
Also, clients should check some other elements when choosing their bank and starting a savings account, and some of those factors include fees, which means that customers should look for a bank that has no monthly service fees and no transaction fees. Some banks even require a minimum balance, which is also something that should be avoided if possible.
Customers who wish to set up the account should ask for the option of automatic transfer, which means that pre-arranged amounts will be taken out of paychecks and salaries at regular intervals.