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Things you need to know about a Savings Account

Savings account

It is common knowledge that a savings account is a bank account wherein you can keep your savings. While this is true, there are many more aspects to a savings account. This article explores all the important things you need to know about a savings account. Before you delve into the details about a savings account it is important to understand the basics first.

What is a savings account?

A Savings account is bank accounts that hold your savings and provides a moderate rate of interest. Whatever money you want to save besides your daily expenses, can be deposited into a savings account. A savings account gives you good access to your money i.e. high liquidity, hence a savings account has become a popular means of saving.

How to access your funds in the savings account?

  • ATM Withdrawals
  • Online debit/Transfer
  • Debit Card Payments

However, you should check with the respective bank about the daily/monthly withdrawal limits.

Benefits of A Savings Account:-

Safety: - Savings account is a very safe means of saving money. Moreover, with fixed interest rates you can be assured that your savings will come back to you along with interest.

Discount on Lockers: - Savings account holders can avail discounts on locker rent from their respective banks.

Accessibility: - The money in your savings account is readily accessible whenever you need it. During the regular business hours, you can make withdrawals directly from banks. Otherwise, you can always utilize the 27x7 ATM facility.

Discount of gold purchase: - Several banks offer a discount of 2-5% on gold purchases made through the bank account.

High interest: - Certain banks offer high rates of interest on savings account. Banks such as Kotak Mahindra give out a high-interest rate of 6% on their savings accounts.

How much money should you have in your savings account?

Due to minimal interests, keeping all of your savings in a savings account is not advisable. Money experts and advisors recommend that you should have enough money in your savings account to cover six months’ worth of expenses. This will cushion you from emergency expenses that may arise anytime. Since a savings account is highly liquid, you can utilize the money whenever you need it.

How to Open a Savings Account?

Ever since the advent of online banking, opening a bank account has become a very simple process. All you need to do is fill in the online form and submit the required documents to the bank. All of the major bank websites have provision for opening a savings bank account online.

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