What are the disadvantages of a savings account?

Other types of interest-earning accounts require you to take risks to earn returns. Fees: One of the disadvantages of savings accounts is that some financial institutions charge fees that can defray your earnings. For example, a monthly fee may be charged if your balance drops below the minimum balance requirement for the account.

What are the benefits of a savings account?

The benefits of a savings account aren’t in how much you earn. Instead, you’ll want to consider the purpose of your account, and the liquidity and access you have. When it comes to your emergency fund, a savings account is likely the best choice.

Are savings accounts better than a savings account?

However, savings accounts come with both advantages and disadvantages. Here's a look at some savings account pros and cons, along with four alternatives that might be better than a savings account. Earn interest: One advantage to savings accounts is that they often pay interest on the money you deposit.

Is a savings account a good idea?

Savings account is a great tool to save money and offer tools and perks for savers. However, there are some drawbacks to consider: Lorraine is a freelance finance writer with years of experience in the banking sector and after a successful career in one of the largest retail and commercial financial services providers.