What You Must Know Before Opening A Savings Account

Written by imoney

A savings account has many useful functions that cater to the various needs and lifestyles of consumers. Here are some of the common uses of savings accounts:

Types of Savings Account

Depending on the amount of money you are able to deposit, you will be offered one or two types of savings accounts.

• Basic savings account or passbook account. A typical savings or passbook account would require you to have a low monthly maintaining balance (of around PHP15,000, for example). Going below that balance gets you charged an administrative fee of around PHP200 per month.
• Money market. If you have more cash, you will be offered a money market savings account. Money market accounts earn you more interest compared to an ordinary savings account but you will need to maintain a higher account balance at the end of each month. You are also limited to withdrawing money to a small number of transactions per month.

Things You Should Check On Before Opening A Savings Account

When opening a savings account, be sure to ask about the following to make sure you are amenable to any benefits and charges that come with opening your savings account of choice.

• Interest rate. Ask about interest rates earned with each account. Find out which option available is best for your savings target.
• Minimum maintaining balance. Each savings account has a required minimum maintaining balance which usually ranges between PHP10,000 and PHP15,000.
• Internet Banking. Ask if the online banking facilities for you to conveniently monitor your finances on the web. Ask what transactions can be done online and the limitations that come with it.

How to open a savings account

Opening a savings is pretty much the same across banks. Here are the steps:

Step 1: Choose your preferred bank, based on the interest and facilities provided

Step 2: Next, go to one of the bank branches to fill out a new account form.

Step 3: Submit the required documents to process your application. This may include submitting a photocopy of your passport, social security system (SSS) card, or driver’s license.

Step 4: Provide the minimum deposit.

Step 5: Obtain your ATM card and Personal Identification Number (PIN). You will need to change this number as soon as you received your ATM card.

It is important to note that there are some banks which do not offer ATM card facilities to certain savings account. Ask the bank’s teller for details during the registration process.