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Savings Account Tips: Nowadays, almost everyone has a savings account. Most people think of it as just a place to store money, but in reality, it's used for many other purposes. Let's explore seven important things and the benefits of a savings account that every account holder should know.

1. Easy Way to Keep Money Safe
You can keep your money safe in a savings account and withdraw it whenever needed. Keeping cash at home runs the risk of theft or loss, whereas money deposited in a bank is considered more secure.

2. Easy to Send and Receive Money
With a savings account, you can send money to anyone and even withdraw money from your account. Thanks to online transfers, UPI, and mobile banking, this can now be done in minutes.

3. Easy Bill Payments
Many payments, such as electricity, water, mobile, internet, rent, or online shopping, can be made from a savings account. You can use net banking, UPI, debit card, or checks for this.

4. You get a complete record of your expenses.
By looking at your bank account statement, you can easily see when money was deposited into your account and when it was spent. This helps you understand your expenses and plan for the future.

5. You earn interest on deposits.
Banks also pay interest on money kept in savings accounts. Although this interest rate isn't high, typically between 2% and 4%, it's still better to keep it in a bank and earn some interest than keep it at home.

6. You can also make an FD from your savings account.
If you know you won't use some money for a long time, you can make a fixed deposit (FD) with that money. FDs offer higher interest rates than savings accounts. However, the bank may charge a fee for prematurely breaking the FD.

7. Interest is taxable.
Interest earned from savings accounts is taxable. The amount of tax you will have to pay depends on your tax slab. Under Section 80TTA of the Income Tax Act, interest earned on savings accounts was eligible for a deduction of up to Rs. 10,000 under the old tax regime. However, no such deduction is available under the new tax regime.

How many types of savings accounts are there?
Whenever bank accounts are discussed, most people think of savings accounts and current accounts. However, the reality is that there are many types of savings accounts, each designed to suit different needs. If we consider only the State Bank of India (SBI), the country's largest public sector bank, there are eight types of savings accounts available.

1. Savings Bank Account
This is SBI's most common and widely used savings account. It offers features like net banking, mobile banking, SMS alerts, ATM/debit cards, checkbooks, and lockers. This account is most useful for salaried individuals or those who perform daily banking tasks.

2. Basic Savings Bank Deposit Small Account
This account is for those who do not have complete KYC documents. Anyone over 18 years of age can open this account. There is no minimum balance requirement, but the maximum deposit allowed is ₹50,000. After KYC is complete, this account can be converted into a regular savings account.

3. Savings Plus Account
This is a special type of savings account linked to MOD (Multi Option Deposit). If the balance exceeds the prescribed limit, the excess amount is automatically converted into an FD. This provides you with the convenience of a savings account along with higher interest rates similar to an FD. This account is beneficial for those with higher balances.

4. Savings Account for Minors
SBI offers two types of accounts for children – Pehla Kadam and Pehli Udaan. The Pehli Kadam account is opened jointly with a parent or guardian. The Pehli Udaan account is for children over 10 years of age, and can be operated by the child themselves. This account is a good option for inculcating the habit of saving in children.

5. Savings Account via Video KYC
If you don't want the hassle of visiting a bank branch, SBI also offers the option of opening a savings account through video KYC. Using your Aadhaar card and PAN card, you can open an account from home using the YONO app or internet banking.

6. Basic Savings Bank Deposit Account
This is a zero-balance account. There is no minimum balance requirement and no maximum balance limit. This account is available to any Indian citizen with valid KYC documents. This account was created to provide free banking services to low-income individuals.

7. MACT Claims Savings Bank Account
This special account is opened to receive compensation payments from the Motor Accident Claims Tribunal (MACT). The funds received by road accident victims are deposited into this account. It offers facilities such as interest, passbook, checkbook, ATM, and internet banking.

8. Resident Foreign Currency (Domestic) Account
This account is for Indian residents who wish to hold foreign currency. This account does not earn interest and essentially functions like a current account. It also does not offer a checkbook or ATM card.

Disclaimer: This content has been sourced and edited from Zee Business. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.