Saving accounts

1. Saving accounts Economics by Louis messenger and Emily guilcher

2. What it is A savings account is the most basic account offered by banks today. It is an account that offers interest on the account, but it also has limited access to the funds. The only ways you can access the funds are through a withdrawal at the bank or at the ATM. Some banks may allow one or two transfers a month from the account, but these are often limited.

3. When would you use it? Most people would save up enough money so they could buy a desirable item that they wish to purchase. For instance a few would be

4. Interest types for savings accounts – any • You can have fixed interest or variable. • The fixed interest rate would mean that it would be say 5% for the duration or the time period of the account being open. • The variable account would go along the base rate as the bank of England so for instance right now currently it would be 0.5% for the interest rate – you can see why people pick the fixed tariff because the rate is higher.

5. Fixed • Advantages? Fixed rates mean usually higher rates The larger the sum of money in the account the larger the amount of money generated per year or per 6 months . The account can be started with only a pound in the account. Some times can have a bonus with the account for being with them. Disadvantages? They don’t want you to use the account for over 5 years because it means a loss for the bank. The rate of interest is high for 1 year, but I t can be lowered afterwards. So therefore you would lose money afterwards. The account could require you to pay a charge to withdrawing money. Most banks offer the service at very different rates and you can choose the wrong deal, so your at a loss.