Types of savings accounts you need to know about

The wrong type of savings account could be quietly costing you. Here's how to pick the one that actually works for your money.

Investing and saving money are both important financial activities. However, there’s quite a difference between them. Saving money is when you set aside cash to use in the future. Investing money, on the other hand, is when you use your cash to buy assets that have the potential to grow in value over time.

The best place to keep your savings is in a savings account. This is a bank account where you can deposit money and earn interest. Savings accounts are a safe and convenient way to save money and grow your wealth over time.

Common types of savings accounts

There are five types of savings accounts in the Philippines: basic, regular, passbook, child, and joint banking account. Each different kind of savings account has its benefits and drawbacks. It’s important for you to know each one well so you can choose which kind suits your needs best.

• Regular savings account

  A regular savings account is a more common type of savings account which offers higher interest rates and more features than a basic account. It usually requires a higher initial deposit and maintaining balance. Many regular savings accounts offer features such as ATM access, online banking, and direct deposit.
  
  

• Passbook savings account

  A passbook savings account is a traditional type of bank account where you deposit your money and receive a physical book called a passbook, that shows all your transactions. Your money earns interest at a fixed rate. This type of account is very safe and convenient because you can easily monitor your account at any time through your passbook or via Metrobank Online and Metrobank App, but you cannot withdraw without going to a branch.
  
  

• Child savings account

  A child savings account is designed to help parents and guardians build a financial foundation for their kids early on. It typically requires a lower initial deposit and maintaining balance, making it accessible for families at any income level. Beyond the practical benefits, it's also a great way to introduce children to the value of saving money from a young age.
  
  

• Time deposits

  A time deposit sits between a savings account and an investment.
  
  A time deposit is similar to a passbook savings account, but with one important difference: you cannot withdraw your money for a set period of time (usually 30, 60, or 90 days). This type of account usually offers a higher interest rate than a regular savings account. This is perfect for building funds for education, business, or future big purchases.
  
  

• Joint savings account

  A joint savings account is a bank account that is shared by two or more people. This type of bank account is good for couples who want to save money together. The downside is that all account holders who have “or” type joint savings accounts have equal access to the funds, so it's important to trust the other people involved.
  
  

• Business savings account

  A business savings account is a type of bank account designed specifically for businesses. It provides many of the same features as a personal savings account, including the ability to earn interest on deposited funds and to withdraw money when needed. However, there are also some key differences between the two types of accounts. For instance, business savings accounts typically have higher minimum balance requirements and offer interest rates that are different from personal accounts.

Which type of savings account is best for me?

The best type of savings account depends on your own financial situation and goals. If you're looking for a safe and convenient place to store your money, a passbook savings account is the right option for you.

How do I choose a savings account?

When choosing a savings account, it's important to consider your own financial limitations, goals, and needs. There are several factors that must be considered when choosing a savings account including the maintaining balance, balance to earn interest, the interest rate, and the ease of depositing or withdrawing money. Make sure to compare the interest rates, fees, and features of different accounts before making a decision. You should also consider the safety and convenience of the account. For example, if you need access to your cash frequently, a digital bankaccount may not be the best option.

Whichever type of account you choose, make sure to read the terms and conditions carefully. Make sure to also learn about the requirements needed to open an account so you know what you're getting into.

How often should I deposit money into my savings account?

How often you deposit money into your savings account is up to you. Some people make a deposit every time they get paid, while others only deposit money when they have extra cash. The important thing is to make sure that you're making it a habit to regularly deposit to your account so that you can save money for a rainy day.

Find the right savings account for you

The best savings account in the Philippines isn't the one with the highest interest rate or the most features; it's the one that fits how you actually live and save. Whether you need easy access to your cash, a secure place to grow your money over time, or a shared account with a partner, there's an option designed for you.

Take stock of your financial habits and goals, compare your options, and don't forget to read the fine print before you sign up. The sooner you find the right fit, the sooner your money starts working harder for you.

Metrobank offers different types of savings accounts to address various financial goals and needs. Open a Metrobank Savings Account today.