Savings Accounts are accounts into which you can deposit and withdraw money. They are a safe and secure way of parking surplus funds in your hands. Lets take a feature-based look at savings accounts and how they work:
Your money is instantly available to you. You can withdraw your money through a bank counter or from an ATM using your ATM / Debit card. You can also make payments or transfers either through Internet banking or through mobile banking.
The money on deposit in a savings account earns interest for you. Of course the interest rates vary from bank to bank and from account product to product, ranging from the ludicrous to the fairly reasonable. Some banks also provide tiered interest rates with higher balances earning higher interest rates.
This is something that is missing from most savings accounts. However, many banks allow you to link your savings and current accounts – that way you can both earn interest and get the convenience of being able to issue cheques.
All savings account come with an ATM card. Now, many banks are increasingly offering internationally acceptable debit cards (with a Visa or a Mastercard logo) to their savings account holders.
Digital age banking services
Almost all savings accounts allow account holders easy access to their accounts via Internet banking and even, mobile banking, either through mobile-customized websites or through special banking “apps”. Fast, 24/7 phone banking services are also available for most savings account holders.
Types of savings accounts
There are a wide variety of savings account products on offer by banks today, catering to a varied demographic and varying requirements. These include kids / juniors accounts, seniors accounts, premier / privilege accounts with enhanced features, multi-currency accounts that allow you to hold deposits in multiple currencies, Islamic savings accounts that comply with Shariah principles, even Gold and Silver savings accounts that enable you to keep holdings in terms of gold or silver and from which you can buy or sell gold etc.
Keep in mind
Before you opt for a particular savings account product, make sure you check out the following: minimum deposit and balance requirements, caps on withdrawals, interest rate(s) offered, the fees, charges and penalties applicable and the range of services offered against your basic requirements and opt for the one that offers you the best fit at the lowest cost.