{"id":30743,"date":"2021-04-15T13:12:27","date_gmt":"2021-04-15T17:12:27","guid":{"rendered":"https:\/\/www.prepareforcanada.com\/?p=30743"},"modified":"2025-03-06T18:03:37","modified_gmt":"2025-03-06T23:03:37","slug":"types-of-bank-accounts-to-save-for-the-future","status":"publish","type":"post","link":"https:\/\/prepareforcanada.com\/blog\/managing-money\/saving-investing\/types-of-bank-accounts-to-save-for-the-future","title":{"rendered":"Types of Bank Accounts to Save for Your Future"},"content":{"rendered":"\n
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Newcomers should know about the different types of bank accounts to use all the financial resources available to them. Knowing what each bank account is for will help you to put your money in the right place. Opening a bank account is one of the first things you do upon arrival in Canada. A bank account is a place where you can keep your money safe. And buying a house or using a debit card to pay at a grocery store would not be possible without a bank account. As well, a bank account makes you eligible for a loan such as a mortgage and is a convenient way to store your money.<\/p>\n\n\n\n

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What is a bank account?<\/h3>\n\n\n\n

A bank account is an account in which you can deposit and withdraw money. These transactions can be both negative and positive. A positive transaction is when you deposit money in your bank, making your account balance go up. A negative transaction is when you take out money from your bank account, making your account balance go down. These transactions decide what your account balance is, or how much money you have in your bank account.<\/p>\n\n\n\n

With your bank account, you can store large amounts of money that you can withdraw at any time. However, not all bank accounts will allow you to withdraw money at any time. There are two main types of bank accounts; a chequing account and a savings account.<\/p>\n\n\n\n

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Opening a chequing account<\/h4>\n\n\n\n

Opening a chequing account will probably be the first thing you do in Canada because it is the account you will use for your day-to-day expenses. It allows you to withdraw money at any time, making it a convenient way to pay for expenses such as your grocery bill and withdraw money from an ATM. Opening a chequing account will also get you a debit card. A debit card is a card that can make payments without cash. Almost every store in Canada has a debit card terminal so you will almost always have the option of paying digitally from your chequing account.<\/p>\n\n\n\n

One thing to keep in mind is that most chequing accounts have a small monthly service fee as long as the account is running. Most chequing account service fees are usually around the $10 range. However, some chequing accounts have no service fees, called no-fee chequing accounts. <\/p>\n\n\n\n

Some chequing accounts also offer ways to avoid paying monthly service fees. Some ways to avoid service fees are to either maintain a set minimum balance or deposit a certain amount of money into the account each month. The minimum deposit is usually around $5000. This means that if you have more than $5000 in your chequing account, you will be charged no fee that month. A minimum deposit usually ranges from $300 to $500. This means you need to deposit at least the minimum deposit amount in order to avoid paying your chequing account fees.<\/p>\n\n\n\n

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Opening a savings account<\/h4>\n\n\n\n

Opening a savings account allows you to save and grow your money. Unlike your chequing account, a savings account earns you interest on the money you save. However, a savings account cannot be used for day-to-day expenses. There is a fixed number of transactions you can do from your savings account each month, and that number is usually three. If you do any more transactions than that, you will have to pay transaction fees which make a savings account inconvenient for daily expenses.<\/p>\n\n\n\n

Opening both a savings and a chequing account is a great way to manage your money. Together, they have all the features to meet your financial needs. You can keep the money you need for your daily expenses in your chequing account while keeping any additional money in your savings account. That way, you can pay for your expenses while earning interest on the rest of your money.<\/p>\n\n\n\n

Now let\u2019s look into some more specialized types of bank accounts that will help you save for the future.<\/p>\n\n\n\n

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Arrive in Canada Financially Prepared<\/h3>\n

Join us for an eye-opening session on how to build your financial future in Canada with confidence. This free webinar is hosted in partnership with Scotiabank, a trusted leader in newcomer banking.\r\n\r\nTogether, we\u2019ll guide you through how the Canadian banking system works and share free tools and strategies to help you plan, save, and invest wisely as a newcomer.<\/p>\n REGISTER FOR THE WEBINAR \n \n <\/svg>\n <\/a>\n <\/article>\n

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