The most common type of bank deposit, and probably the first account you will ever have, is a savings account. These accounts usually require a minimum amount of 10-100 thousand rubles, or there may be no minimum balance at all. It depends on the bank and the type of account.
A savings (savings) account is the same bank account that can generate interest on a deposit. The main difference from a regular bank deposit is that you have the opportunity to withdraw part of the deposit or even the entire amount without loss and at any time. Income in the form of a percentage of the deposit, as a rule, goes to your savings account on a monthly basis.
Besides the fact that you are less likely to spend money, it is safe to deposit it in a savings account because it is insured. If your home is robbed or a fire breaks out, your money could be lost forever. banks store your money electronically and are ready to give it to you on any working day.
Banks insure your money. This means that even if the bank goes bankrupt (which is very rare!), Your money will still not be lost.
When you deposit money into a savings account (for example, a savings account at Tinkoff Bank), it brings interest. Interest is money that the bank pays you so they can use your money to fund loans for other people. However, that doesn't mean you can't get paid whenever you want. This is how banks make money - selling money! It basically works like this:
- You open a savings account with a bank.
- The bank pays you interest on the money you deposit and leave in this account.
- The bank then lends this money to other people, charging a higher interest rate than what they pay you at your expense.
- The difference in the percentage a bank pays you and the percentage it charges others is the essence of the banking business.
Interest on savings accounts is usually calculated daily and paid monthly. The great thing about compound interest is that the bank pays you interest on the money it paid you as interest! This means that if your deposit brings in one percent return, then every day 1/365 of that one percent of the money in your savings account is added to your total. Here's the calculation:
Daily Compound Interest = Principal (1 + Interest Rate / 365) 365 = (Daily Accrued Amount).
Next, we'll take a look at how a bank manages savings accounts and explain what happens when you open a new account.
Savings account types
A basic savings account (sometimes called a passbook savings account) usually has no minimum balance requirements or is low, but will offer a very low interest rate (which means your money won't make that much).
A typical basic savings account allows you to withdraw money at any time.
Money market accounts usually pay more money in interest, but it usually requires you to have more money in your account. You may also be limited by how many conclusions you can make per month.
Sometimes, but not always, banks charge a fee for opening a savings account. For this reason, you should always compare what different banks have to offer. What you should pay attention to:
- Account commissions and service charges
- Minimum balance requirements (some banks only charge a commission if you don't keep a certain amount of money in your account all the time)
- Interest rate paid to your balance
What Happens When You Have a Savings Account?
When you open a savings account, you receive a small book called a passbook in which you write down your opening balance (the amount you originally deposit), as well as all your future deposits and withdrawals. This tool helps you keep track of how much money you have. You will also be offered to open a debit bank card, thanks to which transactions with money will become much easier
The only thing to do is remember to deposit into your account and relax and watch your money grow!
