Is there a dream house that you want to buy? Are you planning to build a safety net for any unforeseen situations? Regardless of the type of expenses, savings accounts always come in handy. There are several types of savings accounts designed to provide you with a secure place where you store and grow your hard-earned money until you want to use it.
However, most people have no idea how to choose a savings account that is right for them. Due to a lack of research, they often end up earning low interest or paying additional charges.
To help you earn maximum interest on your savings account and minimise your expenses, we have listed a few factors that you must consider:
Interest Rates
Although saving accounts provide meagre interest rates than other investment options, you must compare the available choices. You will be putting your cash here for better liquidity, and choosing a savings account with a higher interest rate is certainly a priority. After RBI deregulated savings account interest rates in 2011, banks are now free to offer variable rates. You also have an option of Neo Banks that offer higher interests than traditional banks.
Minimum Balance
Critical savings account advice is to opt for an option that requires a low or zero minimum monthly or quarterly average balance to avoid a penalty. Moreover, Oriental Bank of Commerce, Punjab National Bank, State Bank of India and Neo banks don’t have any minimum balance criteria.
Online Banking
Nowadays, most banks provide online and automatic services, but a few are stuck with traditional methods. Go for the one that allows net and mobile banking to manage your account. As you can conduct transactions conveniently from home or office and also get automated alerts for important events, these are considered the best kind of savings account. Also, some banks have mobile apps that enable hassle-free deposits and payments, so make sure that the online option is available.
Transaction Charges
One of the most important saving account tips is to read terms & conditions meticulously and understand each point because some banks charge transaction fees. These extra charges are either added recently or include services that you may not even want. It is crucial to go through all the charges before you select the right savings account.
Debit Card Deals
Banks are developing attractive and lucrative debit card schemes to lure customers. Make the best of this opportunity and select the one with the best deals. For instance, Standard Chartered Bank offers zero surcharge at petrol pumps, value-added services and discounts at restaurants, and customer loyalty incentives, including cash-backs and reward points on selected purchases. However, some banks charge an annual fee for the use of plastic money. So, you must be aware of all the policies and terms.
Other Banking Options
If you are planning to choose one bank for all the purposes, then make sure to assess that financial institution’s available bank accounts, schemes, and policies. You must evaluate loan plans, accounts, credit cards, additional charges, etc. Many banks also offer exciting deals and benefits to customers when they open multiple accounts with them. This could be a significant factor to help you make a wise decision.
In Conclusion
A savings account helps you grow your funds while keeping them accessible for emergencies or unexpected expenses. However, not all savings accounts are created equal. Hence, choosing the one that works for you and aligns with your financial goals is important. Researching may take some time, but the payoff is worth your effort.
Author Bio – Naina Rajgopalan has a thing for numbers and a deep fascination to learn about all things finance. She’s been money-wise from a young age and has always shared her knowledge and tips with those around her. Being a part of the content team at Freo Save, a neobank that offers a 7% interest rate on savings along with benefits such as insurance on balance, safe & secure banking, and so on, Naina stays updated with the latest of what happens in the banking and fintech industries. She has taken upon herself to share her knowledge with readers across all walks of life to help them manage their finances and budgets better, so they can make better decisions while spending, borrowing, investing and saving.
