Comparing Savings Accounts & Deposit Accounts

Transaction Account & Checking Account

A transaction account or checking account are commonly used by most account holders on a daily basis. Account holders can deposit funds or have their salary directly credited into this type of account. Account holders often use savings and deposit accounts to pay bills and withdraw funds. Few transaction or checking accounts pay interest on small balances. Some transaction and checking accounts pay no interest if the balance falls under a specified minimum. Check (or cheque) facilities generally suit those who don't like accessing their funds via ATM, don't like carry cash or don't like using BPay to settle their financial commitments or pay their bills. Some check account users find it easier to keep track of their finances if they use a checking account.

Savings Account

A savings account is generally used alongside a transaction or checking ( cheque ) account. The automatic transfer of funds allows periodic withdrawals from the transaction account to the savings account which generally earns a higher rate of interest. Savings accounts allow account holders to save and pay for education, travel, automobiles, starting a family, buying a first home, start a new business and assist with retirement needs. Examples of savings accounts are: Cash Management Accounts, Christmas Club Accounts, Super Saver Accounts and Money Market Saving Accounts.

Cash Management Accounts

Cash Management Accounts usually require a minimum opening deposit and offer a highly competitive interest rate, calculated daily. These deposits may vary dependent on the institution. These accounts are suitable mostly for the financial transactions of individuals, companies, trusts and are easily accessible. Income and dividends can be directly credited to a Cash Management Account, and periodic payments, transfers and bill payments directly debited.

Savings Accounts - Deposit Accounts - Checking Accounts - Some Questions to ask

1. What is the interest rate and when is it paid?
2. Is the interest calculated on the entire balance?
3. What is the minimum opening balance?
4. Are my funds at call?
5. What are the Monthly Maintenance Fee?
6. What are the transaction limitations?
7. What is the minimum balance I can keep in the account?
8. Do I need to make regular deposits into the account?
9. How can I access my money?