Types of Bank Accounts
Bank accounts are changing even though banking has been around for hundreds of years. There has been a revolution in the world of banking that came with the internet just in the past decade. Online banking accounts are big new players in the old realm of banking. At Bank Truth we specialize in online banking reviews and have narrowed our focus to the hottest banking accounts currently offered online. Instead of trying to detail all the different types of bank accounts available, we have chosen to focus on those in demand.
CD Accounts | Certificates of Deposit Bank Accounts
The bank account known as a certificate of deposit, or abbreviated as cd, is among the best interest accruing accounts offered in banking. Certificates of deposits are able to yield such high interest rates because the bank has a greater guarantee that your money will be stored in the account for a specific period of time. If you withdraw from your CD early then the bank gets to keep some of your interest or charge you a fee. So, in most cases, certificates of deposits are a win-win for the banks. The amount of people who are able to store away their money in a cd without withdrawing early, are few, so the chances are in the banks favor. However, if you are the minority then a certificate of deposit works very well to earn you high interest. There are certificates of deposit which are as short as 30 days and as long as 10 years. The most common cds are the 6 month cds. This is an easy to commit to rate and still gives you a higher rate than a normal checking or savings account. The longer you commit to keeping your funds within a bank cd, the higher rate they are willing to pay you for your certificate of deposit account. Certificates of deposits have a fixed rate, meaning that when you open the account, that is the locked rate for the term of the account.
Savings Accounts | Savings Bank Accounts
The most used bank account is the savings account. Banking wouldn’t exist for this type of bank account. Online savings accounts have been a life source for banking businesses. Saving accounts are very different from bank to bank. Some banks offer high rates on savings accounts and other banks offer great benefits or a lack of fees with their saving accounts. Savings bank accounts that are offered as an online solution to banking have better rates overall than local physical banks. Savings have the flexibility of being able to withdraw your money at any time, without having to pay a fee. Most banks require you to keep at least some money in your savings bank account, such as $25, so that the savings account will stay open. Savings accounts have a variable rate, this means that the bank can change the APR rate or APY rate at any time.
Money Market Accounts | Money Market Bank Accounts
Bank accounts known as money market accounts are a newer type of bank account. Money market bank accounts have a savings account feature, which means it has a higher rate than most online accounts, while at the same time possesses a checking account feature. Money market accounts can write checks and use a debit card. This makes money markets the best bank account for those looking for a high interest bearing account and the convenience of being able to write checks and use a debit card. Online money market accounts are sometimes blended with the term of online savings accounts, but they are quite different, even though some banks refer to them as the same. The major difference is the check / debit card banking features. Money market bank accounts are different than money market mutual funds. Money markets are increasing in popularity and more people are using these bank accounts.
Bank Accounts Video
FDIC Bank Accounts
Be sure that the bank accounts that you are going to invest your money in are fdic insured. This simply guarantees that if something happens to the bank that you are insured. All the bank accounts, such as savings accounts, cd accounts, and money market accounts listed on BankTruth are FDIC insured.