Attention Savers! Unleash Your Savings Potential
Procedures for Establishing a Savings Account: Follow These 7 Steps
Get ready to master your savings journey with this straightforward guide.
Ramp up your savings game
A savings account is your key to stashing away your hard-earned cash for emergencies, short-term goals, or that dream vacation. Nearly every bank and credit union in the U.S. offers savings accounts that can help you grow your money through interest.
Grab the right piggy bank
Choose the perfect savings account by picking the right bank. Key features to consider include:
- Competitive APY (annual percentage yield)
- Low or no minimum balance
- Low or no monthly fee
- Widespread ATM availability
- Convenient branches
- Effortless online banking
- FDIC or NCUA insurance coverage
If a bank offers multiple savings accounts, compare them based on the criteria listed above and look for any special features exclusive to each account. Ensure your savings account suits your goals, such as automating the savings process for a new saver.
Gather your documents
With the right bank picked, you'll need to provide some personal details. Have the following ready when you open your account online or in person:
- Government-issued ID (like a driver's license or passport)
- Social Security number
- Date of birth
- Current address (with proof of address if your ID lists an old one)
- Contact information
- Bank account information for funding your new account, if applicable
You might need to unfreeze your credit if you have one in place before opening a new bank account.
Joint or solo venture?
Open an individual account if you wish to save by yourself. A joint account is for sharing with another person, such as your spouse or child. Opt for a joint account for the convenience it brings, as it simplifies access to shared funds and provides a higher level of insurance coverage (up to $500,000 rather than $250,000).
Complete the paperwork
Submit your application with all the necessary information and wait for approval. The process generally happens quickly - from minutes to a few business days.
Fund and grow your savings
Watch your savings account grow with regular deposits. You might need an initial deposit, usually between $25 to $100, to start the account. Fund the account with cash, check, or electronically by making a mobile check deposit or transferring funds from a linked account.
Be mindful of any monthly maintenance fees that, if unchecked, could consume your savings.
Designate a beneficiary
Don't forget to designate a beneficiary for your deposit accounts - a crucial step in ensuring your funds reach the right hands after your passing.
Create your savings strategy
While opening a savings account is a significant step, it's just the beginning of your savings odyssey. To maximize your account, create a savings plan, set specific goals, and automate your savings.
Online banking: A digital haven for your money
Most banks and credit unions welcome online banking, and this includes banking account creation. If you prefer a bank that doesn't have branches, you'll likely need to open the account online.
Solutions for those denied banking access
If a bank denies your application, don't worry. Second-chance accounts are available for those with checkered banking histories. Although they aren't exactly the same as savings accounts, these accounts offer features like ATM access and bill pay. Keep your account in good standing for a set period (often 12 months) to upgrade to a standard savings or checking account.
- A savings account, designed for growing your money through interest, serves as an essential tool for stashing away hard-earned cash for emergencies, short-term goals, or dreams.
- To maximize your savings, carefully select a bank that offers competitive APY, low or no minimum balance, minimal fees, widespread ATM availability, convenient branches, seamless online banking, and FDIC or NCUA insurance coverage.
- When opening a savings account, gather necessary documents, such as a government-issued ID, Social Security number, proof of address, contact information, and bank account details for funding the account.
- Consider whether to open an individual account or a joint account, depending on whether you wish to save alone or share funds with another individual.
- Post-approval and account setup, fund the account with an initial deposit (typically between $25 to $100) and grow your savings with regular deposits, all the while being aware of potential monthly maintenance fees that may erode your savings.
