A savings account is usually the first type of bank account an individual opens. It is a place to keep money for emergencies, life events, purchases, and so much more. At times, one may assume that managing a savings account isn’t worth the effort. If you feel the same way, you should ensure that you’re not overlooking the merits of holding a savings account.
Below is a list of the significant advantages and disadvantages of a savings account for you to make an informed decision.
Interest on savings
The bank pays you interest every quarter on the amount in your savings account. This gives you a chance to earn from the idle money in your account.
A savings account is one of the safest forms of investment. When you deposit your money, you get to earn decent returns minus the risks, as compared to other investment options.
A savings account is highly liquid as it allows you to access and use your funds as and when you like. There is no lock-in period or a cap or penalty on the number of transactions or withdrawals that you can make.
Debit card with added benefits
The bank offers you a debit card when you open a savings account. You can use this debit card to withdraw cash from ATMs. You can also make purchases directly with the card. In addition to this convenience, banks offer rewards and cashback when you use the debit card anywhere. You can enjoy rewards on everything- from refuelling and movie tickets to dining and more.
The easy access to funds can prove detrimental to your savings if you’re an impulsive spender and do not keep a monthly budget.
Fluctuating interest rates
The interest rates of banks fluctuate with time. There, the value of the returns from a savings account is not fixed.
You need to maintain a certain balance in the account. If you cannot, you may be penalised by the bank.
As you may notice, the advantages of a savings account are more than its disadvantages. Also, the disadvantages can be easily overcome by planning and managing your finances well.
IDFC FIRST Bank offers you a savings account with one of the best interest rates in the country. A few reasons why you should opt for it are listed below.
Paperless digital account opening
You can easily open a savings account online. All the formalities will be completed digitally. The KYC process will also be conducted digitally. This spares you the hassle of visiting the branch.
High purchase and withdrawal limit
As of 2021, the account has a purchase limit of ₹6 lakhs and daily ATM withdrawal limit of ₹2 lakhs.
Complimentary Air Accident Insurance Cover
The account comes with an air accident insurance cover of ₹ 1 Crore.
Unlimited cash withdrawals
You can withdraw money multiple times from ATMs for free using Visa Signature Debit Card.
Please Note: These features are subject to change with time. Visit our website to know more details.
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