American Savings
Banks. What are the different types of savings accounts?
Banks offer a variety of ways for
you to save your money and earn interest. The most common
accounts are:
Basic
Savings Account
The minimum deposit requirement for a basic account
is low, from $5 to $200. Your money earns a relatively
low interest rate, but you can put money into and take
money out of your account whenever you want. Basic saving
accounts are also called passbook accounts.
Certificate
of Deposit (CD)
This account earns a higher interest rate than a regular
savings account, but you have to make a larger minimum
deposit, generally between $1,000 and $5,000. You also
have to keep your money in the CD for a certain period
of time. If you take your money out before the end of
the term, you may have to pay a penalty.
Money Market Accounts
This account earns a higher interest rate than a regular
savings account, but you have to make a larger minimum
deposit, averaging between $500 and $2,500. This account
also limits the amount of times you can take out money
each month.
