1. Saving Accounts
Savings accounts are a form of bank account that let customers put in money, receive interest on their balance, and then take cash out when required. A savings account is a typical option for saving and investing since, in addition to these important functions, it may also deliver several other benefits and preferences. Depending on the bank and the particular type of account, a savings account's actual features may vary. Moreover, the bank puts several restrictions on a savings account, for example, the number of withdrawals that one can make each month.
Characteristics of a Saving Account
Following are some of the features of a saving account:
1. Interest Rates
- In exchange for retaining depositors' money with them, banks provide interest to them.
- The portion that the bank settles with on the user's stake is known as the interest rate.
- The amount put in the bank account specifies the interest rate that banks will have to provide.
- RBI's (Reserve Bank of India) banking guidelines may have an influence as well.
- Different banks may furnish contrasting interest rates.
2. Minimum Balance Requirement
Maximum savings accounts make it mandatory for you to sustain a minimum bank balance at the end of the month. Liabilities are assessed for failing to preserve this minimum savings account balance. The minimum balance needed differs between banks and savings account types.
3. Withdrawal facility
You can withdraw your money at any given point from a savings account at any location.
Moreover, there is a limit that is specified by a bank on how much money you can withdraw and how many times you can do so on a monthly or yearly basis.
4. ATM Facility
Banks frequently allow their customers to use their ATMs free of cost. However, there is a fee for using an ATM that is not connected to your bank when you want to make a withdrawal. In addition to the withdrawal fee, foreign ATMs charge a fee for currency conversion when you use one to make a withdrawal.
5. No Age restriction
Anybody of any age group is allowed to open a savings account. Plus the different types of bank accounts have their provisions, eligibility and advantages that make them convenient for people of all age groups. Senior citizens aged above 60 years, children aged below 10 years or people with a salary are all eligible to open a savings account.
6. Account Term
There is no time limit applied to the account opening. The account holder can maintain his/her account for as long as they want. But the account may become inactive if no transactions or withdrawal takes place for a period of two or more years. In such a case the account holder will have to contact the bank.
7. Net Banking
The best facility provided by the savings account is that it lets you conduct online transactions. You can use internet banking or mobile banking apps for various purposes like receiving money, paying bills, investing, ordering food or online shopping.
8. Effortless Account termination
You can seize your bank account at any time by visiting your bank in person. It is important to visit your bank as online closure is not possible. If your account is inactive then you need to reactivate it before closing.
2. Fixed Deposits (FD) and Recurring Deposits (RD)
For a very long time, numerous investors have persisted to go for the FD and RD investment strategies. If you want to invest with slight risk and a guarantee of returns, FDs and RDs could be good options. These accounts are easy to open with reputed banks, non-banking monetary institutions, and post offices as well.
Facets of FD and RD:
- Assured return
- Minimal risk to the amount invested
- Simple facility for renewal and withdrawal
- Adaptable investment size
Eligibility to open a Fixed Deposit Account
The features listed below must be taken into account when opening a fixed deposit account:
- For those who wish to preserve their wealth and avoid taking chances in their 40s or 50s.
- For someone with taxable income, it may be a tax-saving investment choice.