Savings Account

Filed Under » ,
Dictionary Says

Definition of 'Savings Account'

A deposit account held at a bank or other financial institution that provides principal security and a modest interest rate. Depending on the specific type of savings account, the account holder may not be able to write checks from the account (without incurring extra fees or expenses) and the account is likely to have a limited number of free transfers/transactions. Savings account funds are considered one of the most liquid investments outside of demand accounts and cash. In contrast to savings accounts, checking accounts allow you to write checks and use electronic debit to access your funds inside the account. Savings accounts are generally for money that you don't intend to use for daily expenses. To open a savings account, simply go down to your local bank with proper identification and ask to open an account.
Investopedia Says

Investopedia explains 'Savings Account'

Because savings accounts almost always pay lower interest rates than Treasury bills and certificates of deposit, they should not be used for long-term holding periods. Their main advantages are liquidity and superior rates compared to checking accounts. Most modern savings accounts offer access to funds through visits to a local branch, over the internet and through automated teller machines.  

Related Definitions

  •

    Checking Account

    A transactional deposit account held at a financial institution that allows for withdrawals and deposits. Money held in a checking account is very liquid, and can be withdrawn using ...
    Read More »

  • Call Deposit Account

    A bank account for investment funds that offers the advantages of both a savings and a checking account. A call deposit account, like a checking account, has no fixed deposit period, ...
    Read More »

  • Money Market Account

    A savings account that offers the competitive rate of interest (real rate) in exchange for larger-than-normal deposits. Also known by the acronym "MMDA", which stands for "money market ...
    Read More »

    • Sweep Account

      A bank account that automatically transfers amounts that exceed (or fall short of) a certain level into a higher interest earning investment option at the close of each business day. ...
      Read More »

    • Office Of Thrift Supervision - OTS

      The bureau of the U.S. Treasury Department that is responsible for issuing and enforcing regulations governing the nation's savings and loan industry.
      Read More »

    • 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 ...
      Read More »

    • Reserve Fund

      An account set aside by an individual or business to meet any unexpected costs that may arise in the future as well as the future costs of upkeep. In most cases, the fund is simply a ...
      Read More »

    • Interest Rate

      The amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets. Interest rates are typically noted on an annual basis, known as the annual ...
      Read More »

    • Emergency Fund

      An account that is used to set aside funds to be used in an emergency, such as the loss of a job, an illness or a major expense. The purpose of the fund is to improve financial security ...
      Read More »

    • Depository

      On the simplest level, depository is used to refer to any place where something is deposited for storage or security purposes. More specifically, it can refer to a company, bank or an ...
      Read More »

Articles Of Interest

Sponsored links
Hot Definitions
Partner Links
Suggested Definitions