Saving is on everyone’s mind these days and especially so given that so many people are having a hard time making ends meet. But if you have the money to save, it’s never been easier, especially with so many banks offering a variety of online tools, mobile apps, and more. Many of the new cell phones on the market allow you access to bank apps, through which you can make deposits and keep track of everything pertaining to your savings account no matter where you are. For those that don’t already have a savings account, or might be looking to switch up from their checking account, here’s a basic overview of the different savings accounts that might work best for you:
Traditional Savings Accounts
These are the most common account types that you can buy into. All you need to do is deposit your money with bank to open an account and you will earn a certain amount of interest each month. Account minimums vary from $1 to a few hundred dollars depending on the bank. Interest rates and other features vary as well. It’s usually a good idea to shop around for rates and features before opening a new bank account.
This is another kind of savings account but the bank gives you a booklet in which to to record your transactions. This includes any withdrawals you make, deposits, as well as the interest you’ve made on your account. These types of accounts are very useful because they’re FDIC insured for any amount up to $250,000. The figure goes even higher when it’s a retirement account. There are usually few fees that are applied to such accounts and works very similarly to a traditional savings account. The same goes for the low interest rate.
High Yield Savings Account
These accounts, just like passbook accounts, are also FDIC insured but you’re going to earn a lot more interest. That’s why it’s called a high yield account. Traditionally, the higher the balance you keep in your account, the greater the interest rate the bank will give you. However, with these types of accounts, you usually can’t use checks. In some cases you can gain access to the account through your checking account and transfer money that way, if needed.
It’s not hard to start and manage a savings account. It seems that the biggest problem these days is finding the money to actually put in an account. Speak with a banking professional to figure out which option would work best for you.