A savings account is an interest-bearing deposit account held at a bank or other financial institution. Though these accounts typically pay a modest interest rate their safety and reliability make them a great option for parking cash you want available for short-term needs.
How Savings Accounts work:
Savings and other deposit accounts are important sources of funds that financial institutions use for loans.
Savings account interest rates vary. With the exception of promotions promising a fixed rate until a certain date, banks and credit unions might change their rates at any time. savings accounts require a minimum balance in order to avoid monthly fees or earn the highest published rate. Some banks limit withdrawals to six per month after the Federal Reserve set that limit only to withdraw it in April, 2020. Exceed six withdrawals, and a bank might impose a fee, close your account, or convert it to a checking account.
How to open a Savings Account:
To set up a savings account, visit one of the bank. You will need to provide your name, address, and telephone number, as well as photo identification. Some institutions will require you to make an initial minimum deposit at the time you open the account.
You can make your initial deposit with a transfer from an account at that institution, an external transfer, a mailed in or mobile deposit check, or a deposit in person at a branch.
Interest of Savings Accounts:
Earn an interest between 4% to 6% on a pre-specified basis. Since these accounts do not allow unlimited transactions, it is easier to accumulate more funds over a period of time.
Top Banks that have the Best Savings Account for Individuals:
- State Bank of India (SBI) Savings Account.
- HDFC Bank Savings Account.
- Kotak Mahindra Bank Savings Account.
- DBS Bank Savings Account.
- RBL Bank Savings Account.
- IndusInd Bank Savings Account.