Linking checking and savings accounts is a trend that many people are finding advantageous these days. Sometimes banks will have better programs for a customer is he or she has both checking and savings accounts with the institution. Sometimes the savings account interest is higher. Other times checking account fees are waived or checks are free. Credit unions are well known for this. It is standard with a credit union for a savings account to be required, with a minimum deposit of around one hundred dollars to open a checking account. Sometimes the minimum deposit is as low as twenty five dollars. The credit union or the bank will usually feel more secure knowing that you are doing most of your financial business with them and will be very easy to work with.
Sometimes the bank or credit union will have a system in place to automatically transfer funds from your savings account into your checking account if you run short of checking account money. This automatic transfer is a safety net for you in case you become confused about the amount of money in the checking account. This way your checks will always clear and you’ll avoid overdraft charges, which can add up to quite a bit of money.
Many people have a system set up that works in reverse. If you have more than a set maximum limit in your checking account, money will be transferred to your savings account where it will earn interest. In this way your money will make you money.
These days many banks and credit unions have online banking available. Using online banking allows a person to safely and securely log onto the Internet and check transactions. These deposits and withdrawals can usually be checked on both the checking and savings account if they are linked. A person can also look at monthly banking statements online. Some banks no longer mail out monthly statements and instead suggest their customers go online to check the transaction record and the balance. For many people this is a convenient system. Some even link money market accounts to checking and savings accounts. When a set amount of money is reached in the checking account it is transferred to the savings account. When a set amount of money is reached in the savings account it is transferred to a money market account, or sometimes to a certificate of deposit where it will earn a higher interest rate.
Linking checking and savings accounts is encouraged by many banks and credit unions because it gives the customer flexibility and a better knowledge of his or her financial situation at any given time. In the old days, before computerization, this was not possible, but today it is the system that seems to make the most sense for many. Linking the two accounts is one of the conveniences of the modern banking system, and the right choice for many consumers.