Save More with a Personalized Savings Account 

Saving money can be hard. Especially if we believe that if we’re not saving $50, $100, or more each month, we shouldn’t even bother, or that there isn’t a savings account for those of us needing to save in smaller increments.


But what if there were?


Below are six types of savings accounts with variations of the three key factors of any savings account: APY (Annual Percentage Yield—the amount of interest you earn), liquidity (how easy it is to take money out of the account), and fees. Read on to learn more.


  1. Basic Savings Account – This is the vanilla of savings accounts. You put money in and it earns you a small amount of interest every year, typically 0.03% at banks and 0.22% at credit unions. You can make as many deposits in a year as you want, but you’re limited on the number of withdrawals. It’s likely to have a minimum balance requirement, but that amount can vary. Setting up an automatic savings plan automatically transfers a pre-determined amount each month from your checking to savings account.
  2. Online Savings Account – Going 100% digital with your savings through an online-only bank means higher interest rates (as high as 1%), low or no monthly fees, and no minimum balance requirements. Some brick-and-mortar banks and credit unions have online-only savings accounts with lower fees and slightly higher interest rates than their standard accounts. This is best for the self-sufficient and tech-savvy. You’ll need an existing checking account to set one up.
  3. Money Market Account – This sits between the basic savings account and a CD (certificate of deposit). They can pay higher APY and you have access to your cash, but they require a larger minimum balance, usually in the thousands. You can write checks against this account or sometimes use a debit card, but the monthly withdrawal limits still apply: six times/month. This is good for a built-up emergency fund because of the easy access to your cash. It could also be used to hold savings for school tuition or quarterly tax payments.
  4. Certificate of Deposit (CD) – A CD will earn you the highest APY with the tradeoff of locking your money away for anywhere from six months to several years. The longer you promise not to touch the money, the better the interest rate (1%–2.5%). This is a good option if you have a goal you’re saving for (like college, a wedding, a house, a big vacation) and can put away a large sum of money and know you won’t need it. You can get your money out, but you you’ll pay a high penalty for it.
  5. Interest or Reward Checking – A traditional checking account doesn’t earn interest on your balance, but an interest account earns you a small amount of interest and doesn’t impose withdrawal limits.
  6. Specialty Account, i.e. Student Saving, Goal-Oriented – The benefits of goal-oriented accounts or “savings club” programs are mostly psychological and organizational. They help you visualize how close you are to your goal and help you not spend money you’ve earmarked for something special. Student saving accounts typically have low or no minimum balance requirement but be aware they will convert upon your graduation to a basic savings account, which might have stricter terms.


You can always start out with a basic savings account with a low or no minimum balance requirement and when you have enough, move the balance to a money market account or CD to earn you more interest. The importance is to be saving, and to ask your bank or credit union what options they have for first-time savers.

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