Savings Accounts Explained: Achieve Your Financial Goals
Almost everything happens online these days, from the comfort of our homes. Be it shopping
online to making payments, digitalisation has ushered in a revolution of sorts, ensuring that
anything we need access to is available online now. Many people use Internet banking services
to open savings accounts for their personal finances. Document submission can be done online.
Completing the Know Your Customer (KYC) process is possible online. One does not have to
visit the nearest bank branch anymore.
According to a report titled, ‘Women and Men in India’, the total number of savings deposit
accounts at the end of January 2023 was 225.5 crore. A savings account is easy to maintain
and allows sound money management. For instance, if you intend to save some money for your
education, a savings account can help you save that money while earning a small earning
through interest. Additionally, you can open this account in any bank by keeping a minimal sum
balance in it. A savings account helps one achieve one’s financial goals with the benefits they
offer.
Why Is It Important To Have A Savings Account?
accounts are essential for anybody looking to fulfil their financial goals.
Provides Financial Safety
A savings account is a safe space for the money you have earned. Cash kept at home is at risk
for theft. The bank safeguards money in a savings account and is covered by India’s Deposit
Insurance and Credit Guarantee Corporation (DICGC). This implies that even if your bank has
financial difficulties, your savings stay protected to a specific extent.
Consistent Growth
Savings accounts do not have higher returns, but the bank does provide a certain savings account interest rates
annually. It allows your money to grow over time. This growth is critical in savings accounts
because it will enable your assets to grow continuously.
Flexible Functioning
Another key benefit of a savings account is its flexibility. Imagine having your investments in
stocks. Would you be able to take them out in case of an emergency? Absolutely not! Stocks
take time to convert into cash and then go into people’s accounts. The money in a savings
account is available anytime and can be withdrawn through debit cards. Online payments can
also be made at any time.
Types Of Savings Accounts
Now that we know how vital these bank accounts are, let us look at the numerous savings
accounts available to you in the Indian market. This guide will assist you in selecting the best
that suits your financial needs.
Normal Savings Account
It is the most common savings account available in every Indian bank. Farmers, business
people, homemakers, and even students can open this with a minimal balance. Savings
accounts in most banks require a minimum balance of Rs 10,000 in metropolitan and urban
areas, Rs 5,000 in semi-urban areas, and Rs 2,000 in rural areas. This account helps you easily
access your assets and provides lower interest rates than others.
Instant Savings Account
This account is similar to a regular savings account. The only thing that differs is that you can
open this type of account online instantly without visiting a bank. Some banks would even
allow you to register an account with your Aadhaar number.
Salaried Account
Employers in India get all their employees to open a savings account in the same bank. These
accounts allow the company to transfer employee salaries conveniently with less administrative
work. These accounts are similar to ordinary savings accounts, but salary accounts typically do
not require you to retain a certain amount of money in the account.
Family Savings Account
These accounts allow your entire family to use a common platform for all of the diverse banking
requirements of individual family members. It typically indicates that you require less money
collectively to fulfil the minimum balance criteria, and you also have access to premium services
like wealth management.
Privilege Savings Account
This unique account provides amazing features such as unrestricted cash withdrawals,
discounts on bank lockers, and speedier bank service. Some even assign you a personal
banker to assist you.
3-in-1 Account
This type of bank account is ideal if you wish to trade in stocks. You receive a total of three
accounts in one. The first one is for trading purposes. The second one is for stock keeping. The
third one is for normal banking.
Women’s Savings Account
Banks provide this type of women specifically to women. Benefits include discounts on courses
and loans and preferential attention from a specialised banker.
NRE/NRO Account
Such a savings account is used by people who live in another country but have money in India.
The Non-Residential External (NRE) account is used for money earned outside of India, while
the Non-Residential Ordinary (NRO) account is used for money generated within India.
Opening A Savings Account
Gone are the days when people used to stand in queues to open their bank accounts. It is all
carried out digitally and can be done anywhere so long as there is internet access. The process
of opening an online savings account is straightforward. Let us look at how to create an online
savings account. It is a simple but critical step toward reaching your financial objectives.
Conduct Research And Compare
First, begin by exploring several banks in India and compare the services they offer. For
example, consider minimum balance restrictions, interest rates, fees, and customer ratings.
Compare several alternatives that can assist you in selecting the account that best meets your
needs.
Gather All Required Documents
The opening of a bank account necessitates basic information and important documents. PAN,
Aadhaar Card, and proof of address are some mandatory requirements. Prepare and scan
these documents ahead of time to speed up the application process.
Finish The Online Application
Navigate to the bank’s app or website to open an online account. Fill out all the relevant
information and select the type of account you need.
Confirm Your Identity
All banks are obligated to verify their clients’ identities to avoid mishaps. You may be required to
undergo an identity verification procedure, which may entail answering security questions or
presenting supplementary evidence.
Add Money To The Account
Once all the details are filled, begin funding your savings account. You may transfer funds from
an existing bank account or utilise online payment options such as credit cards and e-wallet.
Some banks may allow mobile deposits as well.
Enable Online Banking
Following the financing of your account, you will be given information on how to set up internet
banking. This allows you to quickly manage your savings, check your account, make
contributions and withdrawals, and manage your investments from your mobile device. External
payment apps can also be linked with bank accounts.
Bottomline
A savings account is an excellent option to obtain financial stability. There is less risk tolerance,
which initiates more secure savings. Though slowly and steadily, your savings will definitely
increase. It also depends on the type of savings account you choose. Just open an online
account with a reputable bank and efficiently fulfil your financial goal. With this, you may prepare
for a more secure and profitable financial future.
