Learning how checking accounts and savings accounts work is essential part of having a balanced personal budget:
What is a savings account?
A savings account is one of the safest place to save money for the future, or for unexpected expenses objective. There are several common types of accounts that can be used to save, including money market accounts, normal savings accounts, and time deposits ( “Certificate of Deposit” or “CD” for its acronym in English). Ask your bank for details. Many banks have selections in their websites that you may find useful.
When you place your money in a savings account, the bank rewards you by adding, on a regular basis, a small amount of extra money, called interest, to the account. As a result, your money grows! The amount you earn will depend on interest account you choose and how much money it’s kept in the account over time.
What is a checking account?
It is an excellent tool for managing your money every day. It is an account that allows you to deposit checks or cash (which is usually called a deposit) or withdraw money (what is called a retreat). It allows you to get cash when you need it and pay for things without using cash, for example using checks or a debit card. Different financial institutions offer various checking accounts with different features, benefits and costs. Compare the offers to find the checking account that best suits your needs.
What is a check?
It is a safe and convenient way to pay expenses with funds from a checking account so. Checks are paper documents that are used to transfer money from one place to another. A check is a written order to a bank to pay a specific amount of money from certain checking account to a particular person or entity, such as a store. You can order checks when you need and usually charge a fee for them.
What is an ATM ( “Automated Teller Machine” or “ATM” for its acronym in English)
It is a specialized computer that allows bank customers to manage their money. Almost all ATMs allow you to withdraw money and many of them also allow you to make deposits. In some ATMs, you can print a statement (a record of the activities or transactions in your account), check the balance of your accounts , transfer money aming your accounts and even buy postage stamps. Normally, ATMs operated by your own bank will offer maximum services.
What is a debit card?
A debit card is also another safe and convenient way to pay expenses with funds from a checking account so. It can be used at ATM machines. Due to the fact that a debit card has a Visa or MasterCard logo, you can use it in places where Visa® or MasterCard® debit cards are accepted. Note that a debit card is not a credit card. When you use your debit card, the money will be withdrawn from your checking account. With a credit card, you are taking the borrowed money, money you’ll pay later.
Benefits of checks and debit cards?
If you have checks or a debit card, you do not have to carry large amounts of cash. Every time you write a check or a purchase with a debit card, you have a record of how much you spent and where you spent. This can help you pay more attention to what you are buying, how much you are spending and avoid over spending.
Note: Many savings accounts limit the frequency with which you can remove or withdraw money from the account. Therefore, to pay your monthly bills or making everyday purchases, checking accounts are a much better option.