Your savings account is designed to help you prepare for an emergency or an unexpected expense for your car, house, or dorm room.
There are two common types of accounts that you can open at any bank or credit union--checking and savings accounts.
Your checking account is designed for your daily transactions like your bills, your rent or mortgage, or your spending money. Checking accounts usually have lower minimum balances, no limit on the number of transactions, and have an ATM card for managing your account. Using your checking account instead of check cashing and pawn shops can save you hundreds of dollars a year. There is no fee for using your bank or credit union’s ATM to withdraw money from your account, so pick one that is close to your home or work.
Most people seem to try to save a little money each month. Your savings account is designed to help you prepare for an emergency or an unexpected expense for your car, house, or dorm room. Many people open a savings account because most checking accounts won’t earn you interest on your deposits while savings accounts do. Also, when your money is tucked away in savings, it’s easier to forget about it so you can start to build up your savings for other large expenses.