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Top Features to Look For in a Savings Account

A savings account is an invaluable tool that often creates financial well-being for individuals. It allows you to have a way to plan for specific needs, such as retirement, vacations, or a down payment on your home. At the same time, it is a vital tool when there’s an emergency and you need fast access to cash.

As a component of your financial planning, it’s beneficial to choose the best savings account for your needs. However, it helps to learn how to choose a savings account based on the features it offers and how well they align with your specific needs. At HFS FCU, we’re committed to offering you the best checking and savings accounts.

Key Features of a Savings Account

A careful comparison of the features of savings account options can help you see which one may be best suited for your individual needs. Here are the most important features to look for in most of these accounts.

Interest Rates:

One of the core benefits of a savings account is that it offers an interest rate. Which means over time, your money will grow in value. The higher the interest rate, the better, which means you’ll earn more in the same amount of time.

When choosing a savings account, look carefully at the interest rates. Complete an interest rate comparison of each of the accounts available to you within the same financial institution and elsewhere. You may find that there are significant differences in interest rates among financial institutions.

Account Fees:

The next factor to consider is the account fees associated with the savings account. While some accounts offer robust features, they may come at a price to you. Learn what those fees are for any account you’re considering, along with when they apply. Some may only apply if your account balance drops below a specific level. Other times, they could be monthly fees.

You need to assess the fees and charges associated with the account carefully. Lower fees and higher interest rates tend to be the best combination, but not all organizations offer this. Be sure to look for balance here – the best possible interest with the lowest fees.

Minimum Balance Requirements:

Another difference between savings accounts is the balance requirement. Some accounts require you to maintain a minimum balance in the account to earn the highest interest rate on the funds or to eliminate or reduce the monthly fees.

Be sure to compare minimum balance requirements among financial institutions to ensure you can routinely meet that level. If not, consider a savings account without such a requirement.

Withdrawal Limits:

Some types of savings accounts limit how frequently you can withdraw money from the account, or, in some situations, you may be limited on how much you can withdraw within a specific period of time.

Read through all of the terms and conditions for any withdrawal restrictions. Most often, the goal of a savings account is to keep as much in your account as possible and minimize the number of transactions withdrawing funds. Still, you should understand the rules to know what to expect if you plan to make a big purchase or transfer a large portion of your savings.

Account Accessibility:

As you consider what to look for in a savings account, don’t overlook the importance of an easy, streamlined method for accessing your account. Your savings account should be accessible through online banking and mobile apps. Also, find out where in-network ATMS are located near you.

Account accessibility should also include factors such as how easy it is to transfer funds into and out of your accounts or between them. You may also want to ensure that there is ample security in place for any transaction you complete.

FDIC/NCUA Insurance:

When it comes to what to know before opening a savings account, do not overlook the importance of financial protection. If you are opening a savings account with a reputable bank, your funds should be covered under the Federal Deposit Insurance Corporation (FDIC). If you are opening a savings account at HFS Federal Credit Union, your account is federally insured by the National Credit Union Administration (NCUA).

Both of these insurance programs provide you with insurance up to $250,000 per depositor, per insured bank, and per ownership category. That means if there is a run on the bank, your money is covered up to that value.

Additional Banking Services:

Another factor to consider beyond the features of a savings account is the other services offered by the organization. You may wish to buy a car or home at some point. You may be looking for investment opportunities down the road. You may even be looking to establish a retirement account.

When you have access to all of these services from one provider, it’s often easier to transfer money between accounts and to show proof of your savings when there’s a need to do so. Then, you also want to ensure the organization offers good customer support tools and account management tools to support all of the services they offer to you.

Types of Savings Accounts

When you consider what to look for when opening a savings account, you’ll likely need to carefully consider the various types of accounts available to you. Here are some options to consider that may be available through multiple financial institutions.

Basic Savings Accounts

A basic savings account typically will offer low fees for limited services. You can put money into the account and watch it grow in value. Interest rates can vary between accounts, but tend to be lower to moderate. Most offer online banking services and mobile apps for management. Most financial services offer basic accounts.

Money Market Accounts

A money market account is similar to a traditional savings account, but also offers some checking account features, making them a safe option for many people. They may have a higher interest rate than some high-yield savings accounts.

Share Certificates

Another type of savings account is a share certificate. It allows you to deposit funds into the account to grow in value over time. Typically, these have a fixed annual percentage yield, meaning they will earn a specific amount of money within a specific timeframe as long as the funds remain within that account. Fixed interest rates and maturity periods may range between financial institutions.


What is a savings account?

A savings account is a type of financial deposit account that applies interest to the money held within it.

How do I choose the best savings account for my needs?

To choose the best savings account, consider the features, costs, and accessibility of the account. Be sure to learn as much as you can about the financial institution and its overall financial stability as well.

What is the difference between an interest rate and an Annual Percentage Yield (APY)?

The difference between APY and an interest rate is compound interest. That is, with an APY, the interest is earned on the original amount deposited into the account, as well as all of the compound interest that’s earned within the year. By comparison, the interest rate is just the interest earned on the specific amount deposited.

Are savings account insured by the NCUA?

If your credit union is a member of the NCUA, then the balance in that account is insured up to the protections allowed by NCUA.

Can I have multiple savings accounts?

Yes, you can have numerous savings accounts in one or more banks or financial institutions, as well as more than one type of account.

Are there penalties for withdrawing money from a savings account?

There could be depending on the terms and conditions that are established by the financial institution.

Final Thoughts

Savings accounts are a core financial tool designed to help individuals build wealth. Once you learn how to choose a savings account, you can decide what account best fits your needs.

Now, take a look at HFS FCU and our savings products. If you need help choosing one that’s right for you, give us a call today or visit a branch office.

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