A savings account can be quite useful if you are looking for ways to securely store your funds and earn interest over a period of time. You can easily open such a savings account with most banks/financial institutions and make use of the wide range of features they offer.
There are different types of savings accounts that cater to specific needs/requirements. Each type has its own set of useful benefits and can come in handy for different purposes.
Learn more about the types of savings accounts, along with their features, benefits, and more.
The following highlights some of the major types of savings accounts and how they operate:
A regular savings account is one of the most traditional forms of storing funds and can be opened with nearly all financial institutions across the country. It can also provide you with interest over the saved amount but requires the maintenance of a monthly minimum balance in most cases. Failing to do so can result in certain penalties or fees that may be deducted from your funds.
One major benefit of this account is that, unlike the regular savings account, the zero balance variant does not require the maintenance of a monthly average balance. This makes it much easier to earn interest and benefit from other features. Also, there are no zero balance penalties applicable on these accounts, unlike other savings accounts that charge a fee for not maintaining the minimum balance.
It is important to note that in some cases, if you have a zero balance account open with a bank, then you cannot open another savings account with them simultaneously.
This type of savings account is linked to an individual’s corporation. This is highly customizable, as per the business relationship between the corporation and the bank. Each has its own set of benefits in a corporate salary account, wherein the most common is zero minimum account balance maintenance. Other benefits include an in-built overdraft facility, retail loan processing charges waiver, locker rental discounts, and more.
This type of savings account is tailored for women and enables them to make the most out of their funds. Such accounts feature many benefits that aim to empower women financially. These can include flexi FD facilities, personal accidental insurance, discounts, complementary minor savings accounts, and more. Furthermore, the annual maintenance charges on DEMAT accounts are waived for the first year, along with an exemption from paying initial joining fees on credit cards.
This account is specifically tailored for children or minors who are under the age of 18 years. It requires maintaining a minimum balance and comes with basic features such as a debit card, mobile banking, e-commerce facilities, and more. There is usually a limit on withdrawals and a maximum credit balance in most children's savings accounts. The main purpose is to help minors get into efficient saving habits much earlier in their lives.
A family savings account can help all family members fulfill their various banking requirements through a single, common platform. Account holders will be given several benefits over the regular savings account, like lower monthly minimum balance requirements, private banking, wealth management, and other added banking privileges.
A senior citizens’ savings account is for individuals above the age of 60 years and provides a host of useful benefits. These include increased interest rates, flexible deposits, and added banking convenience, among others. Such customers may also get free insurance plans with the account, along with preferential FD interest rates.
These are savings accounts opened by Non-Resident Indians (NRIs) or a Person of Indian Origin (PIO). This can help them store funds either in INR or their preferred foreign currency. This account has three sub-types, namely Non-Resident Ordinary (NRO) Accounts, Non-Resident External (NRE) Accounts, and Foreign Currency Non-Resident (FCNR) Accounts. Each of them has a varying degree of purpose but can help effectively meet NRI individuals’ financial requirements.
This is similar to a health savings account but is primarily designed to help pay off your medical expenses. This is especially useful for any emergencies and/or treatments, wherein you have funds available at all times. In addition, these are known to offer high-interest rates that can be beneficial in growing your funds even further.
If you are looking to grow your savings, you can opt for a zero-balance account, a women’s savings account, or a senior citizens’ account to get the most out of your money.
There are no limits on the number of different savings accounts you can open, except for zero minimum balance accounts. If you have one of these accounts open, then you cannot open another savings account with the same issuer.
Savings accounts are more beneficial for securely storing funds and growing them over time. In contrast, current accounts are mainly for those who conduct transactions on a day-to-day basis, generally for business-related purposes.
A restricted savings account features a significant number of limits and restrictions in its usage, which are usually placed by external parties or by the account holders themselves for specific purposes.