Introduction to Savings Account:
•Savings account is offered as one of the banking services.
•In this, the account holders can deposit their money and earn interests.
•You can withdraw it while depositing and earning interest at the same time.
•It is one of the most common features and are offered by all the banks and other financial institutions.
•Usually, savings banks are nationally secured.
•It allows maximum possibility of liquidity and is quite flexible.
•It is very easily accessible and easy to use digitally via Mobile phone, Laptop and Computers.
•There are various perks on opening a savings account in a bank such as- safely, maintenance of funds, ease in managing personal finance, growth in the money.
•The interest you receive on your savings account is subject to income tax.
•Nowadays, individuals are even allowed to open accounts with zero balance.
•The interest rates on savings accounts varies from bank to bank so, individuals should research all the options available before putting in the application for the bank account.
How to open a savings bank account?
Anyone is allowed to open a savings bank account. All an individual needs to open an account is KYC details that is Know your Customer details.
The individuals need to fill up a form of that specific bank where they are interested in opening the account and submit the required identification, address proof and other KYC documents.
Minimum and Maximum amount to keep in Savings Account:
When it comes to savings bank- individuals have two options i.e., zero balance and regular savings account.
For regular savings account, holders need to maintain a certain minimum amount in their account, and it varies with the bank. Some banks even expect the holders to deposit when they open an account and that is essentially Initially investment.
For maximum amount to keep in Savings bank, there is no limit. You can any amount in savings bank without any hesitation.
Keeping money in a savings account is helpful for many reasons. Many popular financial advisors are in favor of keeping money in banks irrespective of the lower interest rates. Here are the reasons why:
- By depositing money in your SA you will end up having a huge emergency fund. You can utilize it in case of any mishap.
- If you want to buy a home or any other item on EMI then through a savings account you can collect money for a down payment.
- It is a healthy habit to save money for monthly expenses so you do not end up in a crunch.
Moreover, it is in the blood of Indians to save money for the future of their kids' education and marriage.
As everyone is concerned about the tax implications- so according to the law interest up to INR 10,000 is tax-free under the Income Tax Act 80TTA and the tax-exempt status on a savings account interest rate is up to INR 50,000 for senior citizens through Income Tax Act 80TTB.
