Traditional Savings Account
When people start saving money, they usually open a standard savings account and add a little bit to it at a time.
These are interest-bearing deposit accounts found at every major financial institution.
Interest-bearing2: A type of bank account that pays users interest for keeping their funds at the bank.
The credit union or bank “pays” you for your savings account in annual percentage yield (APY).
Annual Percentage Yield3: Refers to the annual return on your money with compounded interest.
Depending on the financial institution and the account requirements, your savings account will increase incrementally over time just by sitting there.
Another important aspect of traditional savings accounts is that they are federally insured for up to $250,000 per user. If the credit union or bank fails, you’ll receive your savings up to the insured amount.
One small downside is that while there aren’t strict limits on accessing your funds, there may be penalties for withdrawing too often, usually in the form of a small fee to the account. Be sure to review your savings account disclosures for specific limitations.
Learn more about Keesler Federal’s savings account options