Bank Account

A bank account is a monetary account kept with a financial/banking institution that keeps a record and balance of your money. A bank account is very useful in tracking your expenses and deposits especially in today’s world debit cards and direct deposit.  They can have a positive or credit balance where the bank holds money on your behalf (that is ideal situation) but they can also keep a negative or debit balance where you owe the bank money because you have over pent (in this situation you will the bank overdraft fees). There are several different types of bank accounts.

Savings bank accounts are designed for you to put aside your money, you can make withdrawals, but you can not write checks for payments.  The number of withdrawals or transfers you can make each month is limited.  There are several types of savings accounts including, passbook savings, and statement savings.  A passbook savings account lets you receive a record book in which your deposits and withdrawals are noted to keep track of all the transactions on your account. In a statement savings account, the financial institution regularly mails you a statement that shows the transactions on your account.

Checking bank accounts allow you to use checks to withdraw money or make payments from your account. You can use checks or make electronic payments to pay your bills, purchase products and services with checks or debit cards, send money, and you can transfer money into accounts in other financial institutions. You have fast, convenient, and frequent access to your money.  Some checking accounts pay interest but the majority do not.

Money market bank accounts offer an interest-bearing account that allows you to write checks.  This type of bank account typically pays a higher rate of interest than a checking or savings accounts.  This type of bank accounts often require a higher minimum balance to start earning interest, but they commonly pay higher interest rates for a higher balance. Withdrawing funds from a money market account is not as convenient as from a checking account.  You are limited to six transfers each month, and only three of these transfers can be by check.