In Turbulent Times: How To Keep Your Money Safe And See It Grow, The Importance Of Opening A Savings Account

In these turbulent times, it is important that you save your money and that you make smart choices that will give you the peace and quiet of knowing you will see it grow . There are banks that offer you just that with their savings account. Before you rush off to find the bank that will give you the biggest reward for your money, you must read this article.

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Money is…. Well, money and one can never have enough of it. Money can be channeled into profitable investments that then bear returns for the investors, hence the concept of interest.

Using someone’s money  comes at a cost, which is the bare minimum that the person expects to receive from the borrower when they get their money back. Banks act as a caretaker of your money when you deposit your funds with them, and they also have options to pay you a return.

These interest-bearing bank accounts ensure a certain percentage of return when you put your money in the bank. The return percentage depends on a number of factors and can make the whole deposit experience much more rewarding.

What to Consider When Choosing a Saving Account?

Because banks have to pay a certain amount to the depositor, they generally don’t like to mention that they offer any such service in the first place. Checking accounts are more profitable for banks as the institution doesn’t have to bear interest costs.

Banks generally throw in some extras for the customers as well like bank drafts, cheque books, and free supplementary cards free of cost as they are already earning a handsome return on your deposits and a checking account allows them to keep all of it.

As for a savings account, the benefit has to be shared with the account holder. Banks charge the customers for all extras and basic services. Not all is doom and gloom, as there are certain banks that look to strike a balance between charging the customer for all services while also passing them some of the benefits earned.

Where some banks have a minimum balance requirement for savings account, some also have a maximum investable amount cap. Once the cap has been reached, the excess funds do not earn any return.

The optimal choice is a bank that doesn’t charge the customer the full cost of the services while also paying a handsome percentage in return.

Other things to consider when selecting a bank for your savings account are the branch network, ease of availing credit and the acceptability of its cards.

What are the Fees for Opening a Saving Account?

There are many different types of fees involved with maintaining a savings account. One of these is the maintenance fee that some banks charge on a monthly basis, while others may opt to charge it on an annual basis.

Other non-obvious fees include the charge when the account balance drops under a certain threshold.

There are certain incidental fees involved as well that are the fees that the bank charges for certain services rendered like statements and summary of accounts in a printed form.

The list of fees and charges is not exhaustive as there are a ton of charges that vary from bank to bank; for instance, some banks charge for cash withdrawals while others facilitate it.

How to Choose where to Open One?

Choosing the best bank for your savings account can be a tricky task as you’ll want to maximize your returns while keeping the costs at a minimum.

A good place to start is by analyzing the type of services that you most frequently use throughout the year. If you are habitual of overdrawing your account, you’ll want to go for a bank that charges the minimum overdraft fee.

Similarly, some individuals might be looking to avail of exciting discounts that the local banks offer for dining or other such activities, in such a case choosing a bank that has the best deal partners is the best way.

You’ll also want to get the best service from your savings account provider so if you’re not a frequent traveler and have your business set up in a particular area, local banks would serve you better than some bank that excels at a national level but doesn’t offer tailored services for locals.

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The Best Deals Out There

There is no definitive answer to this. As discussed before, there are a ton of factors in play that decide which bank will prove the best for you but depending on the type of services you’re looking for you can get the following deals:

  • 2.02% APY with Bask Bank
  • 1.90% APY with CIBC and CIT Bank
  • Up to 1.70% APY with Barclays
  • 1.65% APY with Synchrony High Yield Savings

Bask Bank does not have any minimum threshold requirements and is known for its services and also includes auxiliary services exclusive to their savings accounts. As for the CIT and CIBC bank, there are minimum balance requirements to even open a savings account.

Such practices can be a deterrent and if your balance drops below the minimum requirements set out by a certain bank, it is best to stay away from it. This is because the bank may have applicable penalties in case the balance drops down.

Another problem with minimum balance accounts is that they can halt the interest calculation and crediting facility if the balance drops below a certain threshold. It is imperative that the offer by each bank be scrutinized closely before making a final decision.

The banks we included all have an excellent network so payments and usage nationally/internationally should not be an issue even when you’re travelling. Again, it is best to consult your personal banker if they entertain overdraft if you have an intention of using the funds completely in the near future.

Takeaways

We showcased everything you needed to know about opening your own savings account, while Bask Bank’s 2.02% may look excellent on paper, you might be inclined towards some other bank owning to a personal relationship with your banker.

That is why we included all the things that you must consider when going to open a saving account. There are notable options like the Bread Savings High Yield Savings, Citizens Access Online Savings Account, Synchrony High Yield Savings, and Capital One savings account that can help maximize returns and charge very less for your services.

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