Opening a Bank Account: Types of Accounts & Is My Money Safe?
Savings and Checking Accounts
Jonah and Edna were relieved. This made so much sense. Now they knew exactly who does what and what to talk to them about.
So the very next day, Edna and Jonah went to a bank, they made an appointment and met a financial planner and told him they want to put their money in the bank.
The financial advisor then explained to them that they could choose between 2 main accounts. They could even get both if they needed it:
Savings Accounts: An account for adults where you keep all the money you want to save for a while.
Checking Accounts: An account for adults where you can withdraw and deposit money as you need.
Youth Accounts: An account for people under the age of 18. Since children don’t normally need to write checks, most youth accounts are savings accounts.
Most people have a Checking account for their expenses and a Savings account for their long term goals.
Jonah looked a bit worried, “If I put my money in a Savings account, I won’t be able to use it for anything else?” he inquired.
“No! Not at all” the financial advisor replied. “You can take out your money as you need to, but there are no checks given and normally there is a limit on the number of withdrawals you can do. You will even get a bank card so you can access your account even when the bank is closed and more than that with online banking, you can do transactions even when the branch is closed!”
Is my Money Safe in a bank?
Edna thought it was a brilliant idea to put their money in the bank and not worry about anything else. Jonah wasn’t so convinced. He asked the financial adviser, “how do I know my money will be safe?”
The financial advisor nodded, this was a concern many people had. “Your money in your Checking and Savings Account is safe guarded by the government up to an amount of $250,000. This means, if you have several Savings and Checking accounts, the amount up to $250,000 is guaranteed to get back to you should anything happen to the bank.”
“But what if someone robs the bank? “said Jonah
“Money in a branch is kept in a vault which is extremely hard to access. After that, each branch can only keep a small amount of money in the branch and the rest is moved to the central branch in an armoured vehicle so that in the evening no more than $10,000 is usually kept in the ATM. This way the branch makes it incredibly hard for robbers to get any cash. “
Having all their questions answered, Edna and Jonah proceeded to open one checking account and one savings account. They created Joint accounts, which means both their names were on the account.
One of the first things they did is go to the teller and withdraw some money to treat themselves to cake!