COMMON TYPES OF BANK ACCOUNTS
Current or Checking Account
Convenience
If you have a current or checking account, you can write checks to pay bills without having to go to the financial institution or post office to buy a money order or cashier's check. You can also set up some amounts for recurring bills (such as rent or mortgage or a car payment) to be automatically withdrawn (debited) from your account, so that you don't even have to write checks for those.
You can also have an ATM card attached to your account which you can use for cash withdrawal. Your ATM card may even have a debit function which allows you to use it also for point-of-sale purchases at merchants.
Record Keeping
The bank may send you an easy-to-read monthly statement detailing all the transactions made against your account, whether in checks or automatic periodic payments.
Saving Money
Checking accounts typically require you to pay a certain fee per month. Some financial institutions offer free checking, and others offer free checking if a minimum balance is maintained. Even with a fee, this is cheaper than paying for each money order or cashier's check.
Shopping Around for a Checking Account
There are many differences between financial institutions and the services they offer, including the specifics of checking accounts. Here are some things to consider when shopping for a checking account:
Convenience
If you have a current or checking account, you can write checks to pay bills without having to go to the financial institution or post office to buy a money order or cashier's check. You can also set up some amounts for recurring bills (such as rent or mortgage or a car payment) to be automatically withdrawn (debited) from your account, so that you don't even have to write checks for those.
You can also have an ATM card attached to your account which you can use for cash withdrawal. Your ATM card may even have a debit function which allows you to use it also for point-of-sale purchases at merchants.
Record Keeping
The bank may send you an easy-to-read monthly statement detailing all the transactions made against your account, whether in checks or automatic periodic payments.
Saving Money
Checking accounts typically require you to pay a certain fee per month. Some financial institutions offer free checking, and others offer free checking if a minimum balance is maintained. Even with a fee, this is cheaper than paying for each money order or cashier's check.
Shopping Around for a Checking Account
There are many differences between financial institutions and the services they offer, including the specifics of checking accounts. Here are some things to consider when shopping for a checking account:
Location
Interest
Fees
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Restrictions
Other Charges
Special Features
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Savings Account
A savings account is an interest-bearing deposit account with no stated maturity, as opposed to time deposit. You can withdraw or deposit funds into your savings account any time. It pays daily interest on your balance and is normally credited to your account every month. You can choose to receive an account statement or a passbook to keep track of all your transactions and interest earned.
A savings account is an interest-bearing deposit account with no stated maturity, as opposed to time deposit. You can withdraw or deposit funds into your savings account any time. It pays daily interest on your balance and is normally credited to your account every month. You can choose to receive an account statement or a passbook to keep track of all your transactions and interest earned.
Time Deposit
Time deposit is a deposit account paying a fixed rate of interest for a fixed term, varying normally from seven days to a year or more. You cannot withdraw funds before maturity without giving advance notice, and early withdrawal may lead to partial loss of interest. Upon maturity of your time deposit, your bank may automatically renew it together with the interest earned, alternatively, you may transfer it to your other accounts or withdraw the funds.
Time deposit is a deposit account paying a fixed rate of interest for a fixed term, varying normally from seven days to a year or more. You cannot withdraw funds before maturity without giving advance notice, and early withdrawal may lead to partial loss of interest. Upon maturity of your time deposit, your bank may automatically renew it together with the interest earned, alternatively, you may transfer it to your other accounts or withdraw the funds.