Banks in Syracuse NY: Tips To Choosing A Bank For Your Savings
Posted: Apr 30, 2019
Having a savings account is important because you don’t know when you’ll need the extra money to pull out for emergencies, your child’s education, your retirement, or to prepare for the future. For whatever reason you may have in opening a savings account, it’s crucial to shop around to get the best interest rates.
In this post, you’ll learn some helpful tips when choosing a bank to open a savings account, so you’ll have peace of mind and more confidence when it comes to saving up for your future.
Choose the Right Bank Account
A savings account aims to help you save for a major expense in the future, such as your retirement or child’s education. Most banks allow you to withdraw up to six times per month without a fee. However, if you exceed the limit, you’ll be charged a transaction fee or your account will be converted to a checking account.
Unlike a checking account, a savings account accrues interest. Some banks offer an interest if you maintain a minimum balance of $,2000 in your checking account. To open a savings or checking account, you’ll need your social security number, photo identification (driver’s license or passport), and an initial cash deposit (which could be as low as $25).
Here are some important things to consider when choosing a bank to open a savings account:
- Interest Rate: Big banks usually provide lower interest rates than credit unions. Shop around or ask the interest rates of trusted banks and credit unions, such as Empower Federal Credit Union, in your area.
- Reputation: A trusted and reputable bank without traces of grave complaints will give you peace of mind that your money is in good hands.
- Business Hours: You want a bank where you can go and visit on flexible hours of the day or in your days off.
- Customer Service: A friendly staff makes a huge difference in your banking experience.
- Penalty: If you fall short with your minimum balance, most banks charge $10 every month.
Compare Interest Rates
Don’t shortchange yourself—compare rates to maximize your saving potential. While the nearest bank to your apartment, family residence, or office might be convenient, it doesn’t necessarily mean that it is your best choice.
Here are some tips when comparing the interest rates of financial institutions:
- Set a time, like your weekday off, to visit the banks and credit unions in your city or town.
- Just because federal credit unions raise interest rates doesn’t mean that your bank will also follow. It’s hard to divorce yourself from your bank once you’re into it. However, it might be the best time to do so if your savings account is not growing as expected due to the shallow interest rate.
You might consider a community bank or a credit union if you want to visit a financial institution. The advantages of these financial institutions are quicker deposits and higher interest rates. Also, you can use any ATM for free as long as it belongs to the network where the credit union belongs.
Consider Online Banks
You’re probably worried about the safety and security of your savings in online banks because of cyber attacks or online security breaches. However, online banks guarantee that your savings account is insured through the Federal Deposit Insurance Corporation or FDIC, and strict security measures are applied every time. Online banks offer higher rates as compared to brick-and-mortar banks.
Here are the good-to-know facts about online banks:
- Many online banks are owned by key players in the world of financial services, including Discover and American Express.
- Some online banks are online divisions or sisters of brick-and-mortar banks.
- Because online banks don’t have branches, their operations cost less, so some savings are passed on to you through higher interest rates.
Don’t Be Fooled By Enticing Rates
Get ahead financially, most especially if you’re starting a family, but don’t be fooled by enticing interest rates. Financial institutions also have ways to market or promote banking services. Check the long-term effect of joining a bank or credit union. Some banks may entice you with high interest rates to get you to switch, but these may decrease after a few months.
Here are some tips to ensure you get the best interest rates:
- Check the duration of the promotional or introductory rates.
- Compare the interest rates of the bank within five years.
- Talk to the bank manager and ask the right questions about interest rates.
- Always read the terms or the fine print.
Check the Terms and Conditions
Remember that not all banks offer the same terms for opening a savings account, so, as mentioned, you have to ask questions and read the fine print.
Here are some questions you can ask from bank staff:
- What is the minimum deposit required to open a savings account?
- What is your current interest rate?
- Do you charge a monthly service fee if ever I miss keeping a minimum amount in my account?
- Can I automatically transfer a portion of my checking account to my savings account?
Savings Account Versus Certificate of Deposit
A Crtificate of Deposit or CD requires locking in the interest rate for a specific period, which can be as short as three months up to several years. It means your money is also locked in and you’ll be able to save more for your future, as well as your family’s. With a savings account, you’ll enjoy the flexibility of withdrawing money anytime.
Here are the benefits of opening a savings account with the right bank:
- Withdraw your money without any penalty.
- Unlike CD where the interest rates are locked in, your interest rates increase when the bank implements a raise in the savings account.
If you want to maximize your savings, you have to choose a trusted and reputable financial institution. Credit unions, community banks, and online banks offer higher interest rates than brick-and-mortar banks because of low operational expenses. When choosing a bank for your savings, consider the location, accessibility, flexibility, and reliability of the financial institution.
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