This page tells you about the main types of bank account and what to consider when you are choosing an account. It also describes how to open an account. If you switch to a new account, you can ask the banks to manage the changeover or you can choose to do this yourself and set up your new direct debits and standing orders.
The two main types of bank accounts are current accounts and deposit accounts. The differences between accounts include the services available, the amount of interest paid and the access you have to the account. Current accountCurrent accounts are offered by banks, credit unions and An Post. You can use a current account to manage your money day-to-day. A current account allows you to:
Student current account Many banks offer a specific student account and some provide an interest-free overdraft up to an agreed amount. You can use the Competition and Consumer Protection Commission's (CCPC) financial comparisons tool to compare student current accounts. Basic bank account If you do not have a bank account, you can open a basic bank account. A basic bank account is a type of current account that does not charge fees for everyday banking in the first year. Read more about basic bank accounts. Deposit accountA deposit account allows you to build up savings and you can earn interest on this money. Deposit accounts are offered by banks and credit unions. They are sometimes called savings accounts. For some accounts, you make deposits at regular times, usually monthly, and these are called regular savings accounts. Before you open a deposit account, you should know what rate of interest you can earn on your savings. If you earn interest on savings then you may have to pay a tax on the interest called Deposit Interest Retention Tax (DIRT). You should also find out how you can access your money if you need it. Some deposit accounts may have restrictions on how soon or how often you can withdraw money. A deposit account is not your only option – you can save money in other ways, for example, through State Savings.
Before opening a bank account, you should think about how you use your account and what features you want:
Make sure you understand all the terms, conditions and fees of the account before you sign up. You can check the CCPC’s jargon buster for terms that you do not understand. Account feesCheck what fees are charged. There may be maintenance fees that are charged regularly to keep the account open. Maintenance fees may include certain types, or a certain number, of transactions each month. There may also be fees for specific services or transactions, for example:
Before you open your account, the bank should give you a fee information document. This document shows the most important services offered on the account and any related fees that you might have to pay. Your bank must also give you a statement of fees at least once a year. This statement explains the fees incurred on your bank account and gives information on the interest rates applied to your account. Compare accountsThe CCPC provides online Money Tools that you can use to compare the accounts that are available:
To open a bank account you usually apply in a branch or online. Before you open a bank account, you have to provide proof of your identity and verify your address. If you are opening a joint account, you both need to fill in the application and show 2 sets of documents for proof of identity and proof of address. If you apply online, you still need to provide your documents. Most banks need hard-copy forms of documentation to be submitted in-branch or by post after you have completed your online application. The CCPC has some helpful tips on opening a bank account. Page edited: 1 June 2022 Related Documents
If you have a question about this topic you can contact the Citizens Information Phone Service on 0818 07 4000 (Monday to Friday, 9am to 8pm). You can also contact your local Citizens Information Centre. Banks typically have three kinds of savings accounts:
 CIT Bank Savings Connect Citizens Online Savings Account Min. balance for APY $5,000 Marcus by Goldman Sachs Online Savings Account APY 1.50%1.50% APY (annual percentage yield) with $0 minimum balance to earn stated APY. Accounts must have a positive balance to remain open. APY valid as of 07/29/2022. Discover Bank Online Savings APY 1.50%Advertised Online Savings Account APY is accurate as of 08/02/2022 These cash accounts combine services and features similar to checking, savings and/or investment accounts in one product. Cash management accounts are typically offered by non-bank financial institutions. These cash accounts combine services and features similar to checking, savings and/or investment accounts in one product. Cash management accounts are typically offered by non-bank financial institutions. on Wealthfront's website Wealthfront Cash Account on Aspiration's website Aspiration Spend & Save Account - Aspiration Plus APY 5.00%The Aspiration Save Account’s up to 5.00% Annual Percentage Yield (“APY”) with up to 71x the national interest rate is variable, subject to change, and only available to customers enrolled in Aspiration Plus after conditions are met. Customers not enrolled in Aspiration Plus receive 3.00% APY after conditions are met. on Betterment's website Betterment Cash Reserve APY 1.60%The annual percentage yield ("APY") on the deposit balances in Betterment Cash Reserve ("Cash Reserve") is 1.60% and represents the weighted average of the APY on deposit balances at the banks participating in Cash Reserve (the "Program Banks") and is current as of August 01, 2022. This APY is variable and subject to change daily. Deposit balances are not allocated equally among the participating Program Banks. A minimum deposit of $10 is required, but there is no minimum balance required to be maintained. The APY available to a customer may be lower if that customer designates a bank or banks as ineligible to receive deposits. APY applies only to Cash Reserve and does not apply to checking accounts held through Betterment Checking. Cash Reserve and Betterment Checking are separate offerings and are not linked accounts. CDs (certificates of deposit) are a type of savings account with a fixed rate and term, and usually have higher interest rates than regular savings accounts. CDs (certificates of deposit) are a type of savings account with a fixed rate and term, and usually have higher interest rates than regular savings accounts. Barclays Online CD Discover Bank CD APY 3.20%Annual Percentage Yield (APY) is accurate as of 07/28/2022 Checking accounts are used for day-to-day cash deposits and withdrawals. Checking accounts are used for day-to-day cash deposits and withdrawals. Federally insured by NCUA Alliant Credit Union High-Rate Checking APY 0.25%You’ll qualify for an annual percentage yield of 0.25% if you opt out of paper statements and have at least one electronic deposit made to your account each month, such as a direct, ATM or mobile deposit or a transfer from another financial institution. Deposits are FDIC Insured Current Account Deposits are FDIC Insured Chime Checking Account on Citibank, N.A.'s website Citi Priority Account Money market accounts pay rates similar to savings accounts and have some checking features. Money market accounts pay rates similar to savings accounts and have some checking features. Deposits are FDIC Insured Zynlo Bank More Money Market Account APY 1.75%Start earning up to 1.75% APY when you open a Zynlo More Money Market Account using the code NERD Min. balance for APY $0.01 UFB Direct Money Market Account Rates and minimum balance: Traditional banks have savings rates as low as 0.01% annual percentage yield. At that APY, an account with $10,000 would earn $1 in interest in a year. Traditional savings accounts also tend to have monthly fees of $5 or more if you don’t meet certain requirements, such as keeping a minimum daily balance. However, other banks, particularly online banks, have high-yield savings accounts that offer around 0.50% APY with no minimum balance requirement and no monthly fees. Online banks offer federally insured accounts, just as their brick-and-mortar counterparts do. Account access: You can typically access your money at any time. Certain withdrawals and transfers, including online transactions, may be limited to six times per month. ATM withdrawals and in-person requests at a branch generally aren’t subject to these limits. What to know: If you need to access your money for everyday spending more than you need to maximize APY earnings, consider opening a checking account instead. » See the latest high-yield accounts: Best savings rates right now. Rates and minimum balance: Money market accounts tend to pay similar rates to savings accounts, but they typically require a balance of $1,000 or more to avoid monthly fees. The best money market accounts, though, have low minimums and no monthly fees. Account access: Money market accounts usually have the same withdrawal options as savings accounts, but some also come with a debit card or checkbook. However, the bank may enforce the six-per-month withdrawal cap for savings accounts, so purchases would still be limited. What to know: Like other savings vehicles, money market accounts are federally insured to protect your money. They differ from similar-sounding products that are investments. Rates and minimum balance: CDs tend to pay the highest interest rates of the three types of savings accounts. They typically require around $1,000 to open, but there are CDs with no minimum starting balance requirement. CDs generally don’t charge a monthly fee. Account access: None. With a typical CD, you agree to not withdraw the money for a certain amount of time, called a term. If you take the money out before then, you’ll likely pay an early withdrawal fee. What to know: CD terms typically range from six months to five years. The longer the term, the better the interest rate. You’ll find some of the most competitive CD rates at online banks. » To compare CD rates, see our top CD rates for this month. Some nonbank accounts can help you save your money. Rates and minimum balance: Cash management accounts, or CMAs, tend to have interest rates that are comparable to or slightly lower than basic savings accounts. CMAs typically have no minimum balance requirement. Account access: Depositing and withdrawing cash is a challenge with some CMAs, but electronic transfer between CMAs and outside bank accounts is usually easy. What to know: CMAs have similar features to checking and savings accounts, but they're not actually bank accounts. CMAs are offered by nonbank financial service providers — like robo-advisors and investment firms — that sweep customer funds into partner bank accounts in order to provide FDIC coverage behind the scenes. If you have an investment account with the same provider, you can usually link it to your CMA for quick money transfers. » Check out other high-interest accounts. If you’re looking to save for long-term goals, such as retirement or your kids’ college funds, consider Roth IRAs, 529 plans and other vehicles. They can be an important part of your savings strategy. » Read more about how to invest for short- and long-term goals. Next: Best Savings Accounts Ready to upgrade your savings? These high-yield accounts will help you grow your money faster. |
What is the type of account that pays interest on a sum of money that a person has deposited?
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