Linked Savings Account

DEFINITION of 'Linked Savings Account'

Any type of bank savings account that is linked by account number to a NOW or checking account. These are offered for the convenience of the customer, who can keep the majority of the funds in the savings account and move money over into the demand account as needed. This can also qualify the customer for reduced service charges or free checking.

BREAKING DOWN 'Linked Savings Account'

Linked accounts are sometimes called packaged accounts. The balances on both this account and the checking or NOW accounts are generally reported on a single consolidated statement. This arrangement also often allows the customer to receive a higher rate of interest in the savings account on the bulk of the money.