Instant Access Saving Accounts
When deciding on a savings account you decide what is more important, easy access to your money or long term returns. While accounts like term deposits offer the best rates they might not be suitable if your likely to need your money at short notice. An instant access savings account offers instant access via linked accounts with the same bank or direct ATM access.
If your comparing online saving accounts you'll find there are different types of accounts on the market with varying amounts of flexability and features. The most common account types are high interest savings, term deposits and instant access saving accounts.
A term deposit offers a fixed rate of interest for an agreed term, typically ranging from a few months to several years. In additional a substantial minimum deposit is required to open such an account. High interest savings accounts earn higher rates of interest but commonly use a variable rate, and are also very accessible mainly by linking it to a transaction account or a separate savings account. Although accessible, it is not unusual for high interest savings to place restrictions on the number of withdrawals or to require a minimum amount of deposit during the month in order to qualify for the higher rate.
In contrast, instant access savings accounts give you the convenience of access at any time to your deposit with the use of an ATM card. You will have to maintain a minimum balance on your instant access account and this may range from a low of $50 to a high of $5000. As a savings account, it will earn interest income, but the rate will depend on the balance you keep in the account; it will generally be lower than the rate you may expect of a high interest savings account.
It's common for instant access savings accounts to be used as an everyday transaction account. If you've got a high interest savings account then you can link that account to your instant access account as your linked transaction account.
These two accounts may be linked even if you maintain them in different banks. It can be a smart move to have the two savings accoutns at the same institution as this way you can instantly tranfer funds from your high interest saving account into the instant access account and make withdrawals via that account.
Your instant access to the savings account is facilitated mainly by an ATM card, which allows you to have 24 hour access and maximum convenience. Other benefits beyonf the ATM and EFTPOS access include phone banking and 24/7 online banking.
ATM convenience is not limited to the ability to draw funds from the ATM networks operated by your bank and other financial institutions. Once you have a link between accounts then ATM access is a very convenient way to access cash anywhere you need it and at anytime. Other conveniences possible with the instant access savings accounts ATM are:
Making fund transfers to and from the linked accounts Making cash deposits (although this is possible only on selected ATM units) Checking the balance on your accounts
Aside from making deposits at ATMs, you may also deposit money into your instant access savings account by:
- Having your incomes credited directly
- Transferring funds from the linked account or your other savings accounts
- Transferring funds by telephone or Internet banking
- Sending cheque deposits by mail
- Depositing over the counter
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Article on online savings accounts by Richard Greenwood of The Click 4 Group that compares a range of accounts and banking products including term deposits.