In the past, a savings account was thought of as a great way to save your money for the future. After all, you are earning a return on your cash that would otherwise just sit there! Today, a savings account doesn’t look nearly as appealing. There are options out there that make a savings account look like a bad idea.
A savings account is maintained by a large commercial bank and they offer a return on your liquid money. Unlike CDs and bonds, you can withdraw your cash from a savings account with no penalty. Unlike checking accounts, it is sometimes possible to run into snags while working with a savings account, though.
When you want to get money out of a savings account, the process is a little bit different than it might be for a checking account. Instead of writing a check or using your debit card to use money, you might have to go to the ATM or head to a bank in order to access the funds in your savings account.
This slight different between the two types of account is not the only difference, though. In addition to that, there are different rules that make a savings account dissimilar to a checking account. Most of the time, there is a minimum balance required in order to keep a savings account going. There is also a fee that must be paid in order to keep a savings account satisfied. Many banks will give a no fee plan for checking accounts.