What Are The Different Types of Bank Accounts?


In an attempt to manage all of a client's cash assets, banks provide a wide arrange of accounts to accommodate differing needs. To attract customers with set time frame goals, a desire for security, interest rate and fee concerns, banks offer products to serve a diverse audience. Although banks may have financial advisers offering variable financial products, such as annuities and mutual funds, these are not usually bank accounts, but financial tools sold and distributed through the bank.


  • A basic function of everyday life is to acquire money and use it to pay for living expenses. Checking accounts facilitate this flow of business by providing individuals and businesses a place to deposit money and convenient ways to access these funds. Checking accounts allow individuals to write drafts to businesses for services and products. Many have ATM cards, which allow people to access cash at any banking machine or pay for goods without writing a check.


  • Individuals or businesses hoping to save money open savings accounts at a bank for safekeeping. These funds are usually FDIC insured in the U.S. and may be insured by other government entities if opened elsewhere. Savings accounts pay the owner an interest rate, which varies by bank and also with current economic conditions.

Money Markets

  • In exchange for a smaller number of transactions, customers opening a money market can receive interest which is typically higher than a basic savings account. Money market accounts are Federal Deposit Insurance Corporation insured through a bank, different than money market funds which aren't insured and are offered through mutual fund and other investment companies.

Certificates of Deposit

  • Investors not needing access to funds for a period of time and hoping for a fixed rate of return may turn to certificates of deposit, or "CD's." A CD comes in many time frames, from very short --- a month or less --- to a number of years. CDs accessed earlier than the contractual time period may pay penalties but normally forfeit the interest on the account to the bank in exchange for early withdrawal.

Business Accounts

  • Businesses have access to all the same accounts that individuals may have but are required to provide additional information to open and access their accounts. Banks need a tax identification number, articles of incorporation, organization or DBA document, and a corporate resolution to open an account in a business name. Business representatives also are required to decide who will have access to bank accounts and popular features such as ATM and check writing options.

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