What to look for when choosing a savings account

 A savings account is the safest, cost-intensive and reliable option to store funds that will help you meet your short-term needs. Parking your money on a savings account bears modest interest and also makes fund management and access feasible. This is the main reason why most people use savings accounts as their primary mode of transaction with a bank. Besides considering the saving account interest rate while choosing a befitting savings account, there are other important factors that need thorough consideration. 

Let us shed some light on them-

Interest rate

Compared to other investment avenues, the savings account interest rate is the lowest. It stands somewhere around 4%. Sometimes private banks offer 6% to make it lucrative for their clients. But in reality, it might be an artificial short-term figure which can revert back. It is always advisable to go through the underlying terms and conditions before making the final call. 

Applicable fees and service charges

Most banks charge a certain amount of monthly fees to keep your money safe in a savings account. This amount usually impacts the interest rate that you are being paid. You can avoid this if you maintain the minimum balance on your account. Some banks ask for yearly service charges for delivering SMS alerts, duplicate PIN and so on. Before opening an account, you must know the details of these charges. So, there is transparency on both ends.   

Minimum balance

If you are joining a public sector bank to open a savings account, the minimum balance they would ask is probably somewhere around Rs. 500 to 1,000 max. While in contrast, a private bank would ask for Rs. 5,000 to 10,000 as a minimum balance. It is wise not to choose a bank that might lock in a substantial amount of money on your savings account.  

Netbanking facilities

Imagine how great it would be if you didn't even have to visit the bank. You can open Zero balance savings account online from the comfort of your home. Amazing! Right? Obtaining web-based applications is a must-have quality for every sector now. Financial institutions are no exception. People are keener towards using mobile banking and net banking rather than visiting the branch for money transactions or any other monetary matters. So, it is always preferable if the bank you choose offers swift online transaction facilities. 

Quick accessibility 

The core objective of a savings account is to arrange for money at the time of emergencies, so it is crucial to consider how easily you can get access to your funds on your savings account. It is vital to opt for a bank that has a branch and a free-to-use ATM service nearby. 

Automatic transfers

Opt for a bank that offers automatic transfers from your current account to a savings account. This will help you to save some extra money every month. Plus, you can use this facility to pay your EMIs and rents on time. You just need to mention the date and the required amount that needs to be automatically transferred.  

Debit card deals

Some banks offer additional deals on their debit cards ranging from cashback to insurance coverages. Keep a check on whether these offers levy annual charges. For example, some banks offer compelling benefits on their platinum and gold cards, consisting of an annual fee. If you do or do not want to involve an annual charge for extra benefits, have an open discussion regarding that with the respective bank executives beforehand.

Auto sweep facility

While choosing a bank to open a savings account, you can consider having an auto-sweep account simultaneously. This way, your savings account will be linked to a fixed deposit and you will be required to schedule a certain amount. Whenever your savings account earnings exceed the prescheduled amount, the excess money directly gets transferred to your fixed deposit account. This facility is also known as ‘sweep-in’.  

Doorstep facilities

Certain private banks offer doorstep banking services like cheque or cash pickup, documentation pickup, or demand draft delivery. These services are proposed to assist you during your busy schedule. But of course, these services come with additional charges. So, before selecting these options, you should consider the applicable charges asked by the bank. 


A zero balance account comes with a checkbook and a passbook, through which you can keep a record of your monthly expenses and transactions. It provides liquidity so that you can get easy access to cash conveniently. You can even use this account to pay off your bills on time automatically. In terms of investments, you can link your savings account to your Demat account, so the income from dividends gets credited directly to your savings account. So, before opting for a particular bank to open a savings account, it is recommended to consider all the pointers mentioned above, compare the promising options and then finalize.         

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