Savings Account
Savings Account
A savings account is a deposit account held at a Financial Institution that provides a modest Interest Rate. It is designed for individuals to save Money while keeping it accessible for withdrawals. Savings accounts typically have lower Interest Rates compared to other investment Options, but they offer higher Liquidity and security.
Examples:
- Traditional Savings Account: Offered by most banks, allowing easy access to funds while earning interest.
- High-Yield Savings Account: Typically provided by online banks, offering higher Interest Rates compared to traditional banks.
- Specialized Savings Account: Such as health savings accounts (HSAs) or children’s savings accounts, tailored for specific purposes.
Cases:
- A college student opens a savings account to save Money from a part-time job for future tuition fees.
- A family uses a high-yield savings account to save for a vacation, taking advantage of better Interest Rates.
- An individual sets up a specialized savings account to save for medical expenses, benefiting from tax advantages.