Banking On Them
The basic function of a bank is to serve as a secure place where you can deposit and withdraw money. If you have extra money which you want to keep safe, you can go to a bank and keep your money there. To deposit money, you will need to open an account with the bank which is known as a savings account.
How to open a Saving Account?
If you are under 18 years of age and want to open an account in a bank, you will not need a guardian or parent who can sign on your behalf. The bank will ask for and a few documents, you can fill in a form and request the bank to open a savings account in your name. Once you are above 18 years of age, you will be the owner of your bank account, the bank will provide you with a deposit slip book and chequebook. You can also avail of a debit card attached to your bank account.
How to deposit money into a Bank Account?
A bank has many customers like you, who want to deposit money in the bank. The bank thus issues each of these people a unique number – your account number. When you want to put money into your bank account, you will need to fill up a deposit slip with all your details like your name, and deposit the money in your account.
What happens to your money in a savings account?
Money grows in a savings account. Yes! You read that right. A savings account is good for those who don’t want to spend their money soon. By depositing your money and leaving it for a while, you can make money by earning interest on the amount you have deposited in your account. When you deposit money in a bank, the bank does not simply lock it into your account. They invest this money so that it can make more money in return, the bank pays you an interest, which is why savings accounts grow with time. This money you earn is known as “interest income.” this is considered as your earnings on savings.
How to Withdraw money from a savings account?
At the time of opening a bank account, the bank gives you a chequebook too. The purpose of the chequebook is to withdraw money from your savings account. You may withdraw money from your savings account for your own use or to give it to someone else. When you withdraw money for yourself, write a cheque to “SELF” and sign it on the back and front of the cheque. It is always a good practice to write “Account Payee” between two lines on the top left corner of the cheque. If you want to give it to someone else, write the name of the person to whom the cheque is to be given. Make sure you have enough money in your account when you hand out a cheque. If you don’t have enough balance the cheque will “Bounce” and that is considered to be an offence.
Now that you know how to operate an account, start one today and get a grip on saving money for your future needs.
– JANE SHA