Be aware of what the banks are offering
Banks can often advertise features of an account that sound appealing but may not apply to your situation. Unfortunately, this is often quite easily detected by merely reading the terms and conditions or other fine print. By doing this before you take out a new savings account you may be able to avoid what's too good to be true and choose a more realistic account. You can make the detection of unwanted conditions easier by asking yourself a few questions.
Are there asterisks and other similar things next to everything that sounds good about the account?
It's so common to see an asterisk next to an advertised feature of a product that many people just ignore them. This is one of the biggest mistakes people make, however, as it's taking the offer at face value. Look for the fine print associated with the asterisk, and if it says to refer to the terms and conditions on another page rather than listing what you need to know on that page, be very suspicious.
Does the interest rate seem unusually high compared to other accounts?
If one bank is offering exceptionally high rates, does it seem plausible? More than likely this rate will only apply on deposits above a certain level, so be sure to look for anything that points to this being the case.
Are there no fees or no account keeping fees?
Fees can be tricky, as an account that charges no account keeping fee may charge higher than average fees somewhere else. It's not worth saving $5 a month in account keeping fees if your transaction fees will cost you double that over the same time period. A bank claiming there are no fees may also actually be claiming that there are no fees under specific terms of use. Just be careful and read the fine print.
Is there a minimum balance?
Often banks will advertise savings accounts as requiring no minimum opening balance or having no minimum balance at all. This can often be a method to distract from lower interest rates on small balances, as someone who sees a high interest rate followed by a claim of no minimum balance may make a connection that all balances earn the same interest rather than becoming suspicious. Banks want to make money from your deposits, and they are unlikely to pay you any interest if they can't generate wealth from your investment.
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