If you’re looking to open a bank account, you’ll want to do your research before doing so. Not all banks are created equal. Neither are all bank accounts.
There are many, many different types of bank accounts out there, and the one you choose for you will depend upon a lot of different factors. Hence why it’s so important to do thorough research before settling on one.
If you’re unfamiliar with the most common types of bank accounts, then this guide is for you. Read on for a crash course in all the different types available and which is the best bank account for you.
1. Checking Account
A checking account is the most basic level—and most common—type of bank account. This is usually where you’d keep any money you use day to day for any expenses you might have. A checking account comes with a debit card, which will automatically deduct money from your checking account every time you use it.
If you have a steady income, it can be a good idea to put this into your checking account, as you can use this account to pay bills. This type of account is great for tracking your income and expenses if you want to make a budget for your spending.
2. Savings Account
The second most common type of bank account would be the savings account. As the name suggests, this is an account that’s dedicated to any money you’d like to save. If you are aiming to purchase a car, or a house, or anything else, you can decide to put a set amount of money into your savings each month.
When you’re choosing a savings account to open, you should make sure that your bank offers favorable terms (like those offered by QNB bank). You will want a good interest rate and low maintenance fees.
3. Money Market Deposit Account
The Money Market Deposit account is another common type of account that shares similarities with both a checking and savings account. This account will sometimes come with a debit card, so you can use funds from it for your daily expenses, but it will also earn you interest on whatever money you have in there. Usually, the interest rates will be a little more generous than those of a standard savings account.
4. Individual Retirement Accounts
Also known as IRAs, Individual Retirement Accounts are designed specifically with your future in mind. These act as part of your long terms saving strategy (as opposed to a regular savings account which might be more for short to medium-term goals). It’s never too soon to begin thinking about your retirement, and if your employer doesn’t offer a 401(k), then an account like this might be a good thing to look into.
Different Types of Bank Accounts for Different Goals
Hopefully, this breakdown of the most common different types of bank accounts will help you to choose the one that’s right for you. Start organizing your financial life today! For more money tips and tricks, see the rest of our content now.