A Beginners Guide to Opening a Savings Account
Savings accounts are one of the simplest and the most popular services offered by banks. Whether you want to manage your wealth for your future financial goals or manage your day to day expenses, a savings account can help you manage your finances seamlessly. If you are planning to open a savings account, here’s everything you need to know:-
1. What is a savings account?
A savings account is a basic bank account wherein you can deposit your surplus income while earning an interest for the same. The interest earned on a savings account is automatically credited to your account balance on an annual basis.
2. How to open a savings account?
You have two options to open a savings account. You can either open a savings account by visiting the bank personally or by applying for one online. Whether you choose to open a savings account online or offline, you need to fill up the application form and submit documents such as identity proof, residential proof and proof of income.
3. Important Things to Consider Before Opening a Savings Account
The features and benefits of a savings account may vary across different banks. As a result, not every savings account available in the market may be right for you. Here are some important factors you need to consider if you want to choose a savings account that fits your needs:-
Minimum Opening Amount
Some banks require you to make a minimum deposit before opening a savings account. It is usually charged by banks to cover the account opening and maintenance costs. However, if you don’t wish to pay the minimum opening amount, you can opt for other savings accounts which does not charge for the same.
Additional services offered with savings account
An ideal savings account should not only help you save money but also help you manage your money with utmost convenience. When choosing a savings account, you should ensure that you can avail services like debit cards, online banking, cheque book facility, credit cards, phone banking etc. Since demonetization, these value-added services have become more important than ever.
Frequency of Withdrawals
Most savings accounts have a cap on the number of withdrawals you can make. Therefore, if you believe you may need to make frequent withdrawals from your savings account, make sure to choose an account that lets you do so without charging any extra fee or penalty.
When it comes to savings accounts, ATM facility is of paramount importance. Ensure that your savings account offers ATM facility that allows you to withdraw cash from ATMs. Opt for a savings account with a bank that has a robust ATM network both locally and internationally. That way, you can get free and convenient access to your cash wherever you go.
Account Related Fees
While there are savings accounts with no account related fees, some savings accounts entail various fees such as Branch deposit fee, Cash deposit fee at a non-home branch, ATM withdrawal fee etc. The account related fees are generally listed in the term and conditions. Therefore, make sure to read the terms and conditions carefully before opening a savings account.
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