DEFINITION of 'Ninety-Day Savings Account'
A type of passbook savings account that guarantees a fixed rate of interest for 90 days - from date of deposit to date of withdrawal. Upon maturity, account holders can either close the account and withdraw their funds or roll the accrued balance over into another 90-day savings account or another type of account. Some banks use the 90-day Treasury bill interest rate to determine the amount of interest offered on 90-day savings accounts.
BREAKING DOWN 'Ninety-Day Savings Account'
Ninety-day savings accounts can be a competitive alternative to short-term certificates of deposit (CDs) or T-bills because they have a low risk of default and short maturity.
Passbook savings accounts got their names because account holders were given a small book in which the bank staff would record all deposits, withdrawals and interest accrued. Passbooks have, for the most part, disappeared given that most people now receive monthly statements by mail or email.