Chequing vs Savings Accounts What do you use the bank for? By Mo2 on January 31st, 2008

What do you use the bank for?
Every bank has a variety of accounts to suit different people. The basic accounts have lower fees but have only basic features. There are complex accounts that charge higher fees but offer a variety of services. Then of course there are accounts that are made for higher value clients all the way up to private banking accounts.

Chequing Accounts
Chequing accounts, as the name suggests, are for cheques to be drawn from. However, this name can be misleading because nowadays the use of cheques has decreased because of other ways of making payments. For everyday banking, chequing accounts are ideal because they usually have more transactions compared to a savings account. Most people have a chequing account to start.

Saving Accounts
Saving accounts also have a bit of a misleading name. They should call them “Parking Accounts’ if anything. Saving accounts that banks have usually have pathetic interest rates. Some savings accounts have decent interest rates however; even then other investment vehicles that have similar liquidity can offer higher interest rates. These accounts aren’t meant to be your daily banking account, just as the name implies, you aren’t supposed to be taking money out all the time and could lead to higher fees if you do.

Fees for all
So again, what are you using the bank account for? If you are using to make payments and you love using the ATM or POS (Point of sale, which is what you use at department stores or fast food restaurants) machines then you should definitely have a chequing account. Depending on how much you use the ATM or POS you might want to have an account with unlimited transactions.

Create a Relationship
So what do you want to use the bank for? Don’t think of the bank as an enemy. Think of the bank as a tool. Be responsible with what you do with your account, try to avoid going overdrawn in your account unless you have protection, and don’t write NSF (Non-sufficient funds) cheques.

Think of the bank account as something you have to protect and a way to discipline yourself. The bank account is the basis for our financial discipline. If you can’t control your daily spending and don’t have a proper budget, your bank account with a zero or less balance will tell you this.

Mo2 Thinks
It’s important to select the bank account that suits you well. Chequing accounts are something most people should have because we all have a need for a basic bank account. A Savings account is a good way to put aside money for something in the future for whatever reason. Nothing is free in the world we live in; therefore do a little research with the potential fees you will be paying. If you go around using your debit card 400 times a month, it might be smart to have an unlimited transaction account.

Don’t think of the bank as your enemy. Some bankers are extremely snotty and I agree with you there, but if you can put them on your side they are a strong ally. And with anything, this comes with having a strong relationship with them. This means that you have to be a financially responsible person that actually takes care of your money and doesn’t spend their entire paycheque on the day they get it. Try and be smart about money.

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