How Do I Choose the Best Bank Account?

A bank account is a collective term for a deposit account, loan account, and current account opened by a customer at a bank. In China, according to regulations, all state organs, organizations, troops, schools, enterprises and institutions must open accounts in banks. According to different purposes, bank accounts can be divided into three types: basic accounts, special accounts and auxiliary accounts. In the accounting organization of bank accounting, in order to ensure the authenticity, completeness and correctness of the book records, the detailed classification account and general classification account are set up as the source of funds and the use of funds caused by banking and financial activities Record and reflect the breakdown and summary. ^[1]

Bank account

Right!

A bank account is a collective term for a deposit account, loan account, and current account opened by a customer at a bank. In China, according to regulations, all state organs, organizations, troops, schools, enterprises and institutions must open accounts in banks. According to different purposes, bank accounts can be divided into three types: basic accounts, special accounts and auxiliary accounts. In the accounting organization of bank accounting, in order to ensure the authenticity, completeness and correctness of the book records, the detailed classification account and general classification account are set up as the source of funds and the use of funds caused by banking and financial activities Record and reflect the breakdown and summary. ^[1]

In the United States, different banks or financial institutions provide users with a wide variety of account types to choose from when opening an account, but in general they will fall into the following three major categories and 5 small categories: Checking Accounts, Savings Accounts, and Deposit Accounts. Checking accouts include Basic and Interest-baring. Common Deposit Accounts include Money Market Deposit Accounts and Certificates of Deposit (often abbreviated as CDs). ^[2]

Checking Accounts. Domestic individuals use fewer checks, and more of them are used by businesses in business transactions. If you issue a check and someone receives your check and cash it at the bank, the money will be expended from your Checking Account. The check you issue is a cash check.

Checking Accounts penetration is much higher in the United States. With the popularization of Plastic Card (plastic card, debit card and credit card in the form of plastic card), it has gradually been replaced by credit card and debit card payment, and in recent years, it has been divided by emerging mobile payments to share market share. Cheques are used less and less in everyday non-cash payments in the United States.

Savings Accounts. If it is analogized domestically, Savings Accounts is more like what everyone generally understands. It is an account demand account opened when a domestic bank opens an account, but there are some differences, so the current account is quoted here.

The similarity between the two is that the money in the account can be withdrawn and saved at the same time, and get a certain interest; the two are different because usually Savings Accounts can only make a limited number of free withdrawals a month (Withdrawals, depending on the bank) 3/6 times). That's right, the money is yours, but the service fee will be charged if you take more.

Similar to Basie Checking Accounts, depositing a small amount of money (such as $ 300) in Savings Accounts can waive the account management fee, get a slightly higher deposit interest than interest-bearing checking accounts , and withdraw monthly (Withdrawal) and transfer ( Transfer) 3 times each . Payments / transfer transaction fees will be charged if the number of times is exceeded.

Deposit Accounts. Someone may feel dizzy when you see this. What is the difference between deposit and savings? Amount, I can only say that Savings and Deposit are different. If you must give an inaccurate description, Savings is savings. Banks usually use this money to lend; Deposit is also savings, but banks usually receive these money For investment.

Bank account money market account

It is still analogous to China. Money Market Deposit Accounts (MMDAs) can be classified as common domestic financial products sold by banks.

Similar to the minimum subscription amount of RMB 50,000 for domestic wealth management products, MMDAs need to maintain a certain amount of account balance (such as $ 2,500) to avoid account management fees. The bank will use the money you have in the account to invest in short-term commercial bonds, government bonds, or CDs with low risk and almost guaranteed protection from droughts and floods (these investments are called money market investments, know the origin of the name), which is higher than Savings Accounts Interest rate returns. It is more flexible than domestic financial products that can only be redeemed on a fixed date. It can issue a limited number of checks or perform a limited number of withdrawals / transfers (such as checks + withdrawals + transfers no more than 6 times) per month.

Bank account regular deposit

I believe everyone is familiar with this type of account, which is what people usually call "dead deposits." Certificates of Deposit (CDs) have a minimum subscription amount (such as $ 5,000), and negotiate with banks to negotiate interest rates ranging from 3 months to 6 years. The longer the deposit time, the higher the interest rate . Under normal circumstances, no deposit can be made after the deposit certificate is opened, nor can it be withdrawn at any time . Early withdrawal before maturity (Maturity) will lose a large portion of interest.