Investment is the key to a bright and secured future. But, not many people know when and where to invest their money and hence decide to keep their money in a saving account. There are several banks and post offices where you can easily open a savings account. These savings accounts accrue interest on the deposited funds over time. In India, you can easily find a bank or post office to open a savings account for you. But, to get you the best return on your money that you keep in a savings account, you should check where your money can be safe and earn you well. To help you choose the best saving account of the two, check all the factors that differentiate normal savings account and post office savings account.
A regular savings bank account is an interest-bearing deposit account, which is held at the bank. A post office savings account is exactly similar to the regular savings account that can be opened at the post office. The funds kept in a post office savings account also earn interest on all the investment made by the holder. However, there might be certain differences in the interest rates that both these savings account offer.
Regular Savings Account
A regular savings account is an interest bearing deposit, which is kept with the bank or financial institution to provide a modest interest rate. Banks or financial institutions can limit the number of withdrawals for every month and may charge fees if you do not maintain a certain average monthly balance in the account. A savings account possesses several benefits, which help to secure your earnings and set aside money for short term spending purposes. Your money kept in
savings bank account will always be available and accessible in any case of emergency with little or no withdrawal fees.
Following are some points that you should know about Regular Savings Account:
1. Banks offer 15% to 30% discount on locker fee to account holders who maintain the minimum quarterly balance in their accounts.rn2. Banks allow account holder’s family members to combine their deposits and increase their corpusrn3. Several banks offer life insurance and accident hospitalization on opening a savings bank accountrn4. Banks also provides you the benefit of insuring your debit card against instances of misuse or theft, under the purchase protection clausern5. Discount on gold– A rebate of 2% to 5% is available on purchasing gold coins from banks, especially for customers with large account balances.rn6. A saving bank account comes with cash withdrawal facility through bank and ATM that help to withdraw cash from anywhere in India, at any given time.rn7. You can convert your debit card provided by your bank to an international debit card to use it for transactions made overseas.
Post Office Savings Account
As the name suggests, a Post office saving account can only be opened at a post office. Post Office Savings Accounts are quite similar to a regular bank savings account. Post Office Savings Account comes with a stricter and secure environment as far as the account holder’s money is concerned. But, Post Office Savings Account does not support electronic withdrawals. So, one has to rely on manual withdrawals. (Maybe with restrictions)
A post office savings account provides interest rate of 4% p.a., which is quite similar to what most other banks provide on their normal savings account. In
post office saving account, account holders have the right to withdraw the funds either fully or partially, as and when the need may arise. But, the process of withdrawal is not that quick and hassle free. All the processes related to the post office savings account are manual and a bit time taking as well. However, in regular savings account, it is easy to withdraw and transfer funds from one account to the other.
Following are some points that you should know about Post Office Savings Account:
1. Post Office Savings Account can be opened by cash onlyrn2. Cheque facility can be taken in an existing account alsorn3. Nomination facility is available in post office savings bank account at the time of opening and post opening of the accountrn4. The post office savings account can be transferred from one post office to anotherrn5. The account can be opened in the name of the minor and a minor of 10 years and above age can open and operate the accountrn6. A joint account can be opened by two or three adults.rnAccount holder should make at least one transaction of deposit or withdrawal within three financial years to keep the account activern7. A single account can be converted into Joint and Vice Versarn8. Minor after attaining majority has to apply for conversion of the account in his name
Both the regular savings account and post office savings accounts are preferred by investors looking for a risk-free investment, however, people in rural and semi-rural areas prefer post office savings account while the investors in metropolitan cities greatly rely on keeping funds in a regular savings account.