Savings Account
A savings account is a deposit account that typically earns interest on the balance. It's designed for storing money rather than frequent transactions.
Savings accounts traditionally have withdrawal limits (often 6 per month in the US, though this was relaxed in 2020) and earn higher interest rates than checking accounts. They're ideal for emergency funds and short-term savings goals. Banks also offer CD products, and inactive balances can become a dormant account under Regulation D rules.
Related Terms
Checking Account
A checking account is a deposit account held at a financial institution that allows withdrawals and ...
APY
Annual Percentage Yield
APY is the effective annual rate of return taking into account the effect of compounding interest. I...
Interest
Interest is the cost of borrowing money or the return earned on deposited funds, typically expressed...
CD
Certificate of Deposit
A CD is a savings product that holds a fixed amount of money for a fixed period of time (term) and p...
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