The Difference Between Checking and Savings Accounts

Checking vs. Savings Accounts: which account features are best for you.

Checking accounts are set up to be convenient for everyday spending, including purchases, bill payments, and withdrawing walking-around money from ATMs. Savings accounts, on the other hand, are used to securely hold money and to accumulate interest for future use or purchases, such as buying a house. Each kind of account has specific features that makes it beneficial for users. Below is a breakdown of both account types and their unique features.

Checking vs. Savings Accounts

These typical features of checking and savings accounts illustrate the differences between them:

Checking Accounts Savings Accounts
Earn no interest or a lower rate of interest than savings Earn higher interest rates than checking
Unlimited number and timing of withdrawals Monthly withdrawal and transfer limits
Branch and ATM access Branch and ATM access
Online and mobile banking service Online and mobile banking service
Debit card ATM card for some accounts
Paper checks
Electronic payments
Direct deposit Direct deposit available for some accounts
Overdraft protection

Benefits of a Checking Account

A checking account is a secure account held at a financial institution that allows account holders to put money in and take money out as needed. Their main features are designed to make deposits and withdrawals convenient. Customers can deposit cash, checks or money orders at a branch or ATM, run checks through a mobile banking app, or have their paychecks directly deposited by their employer. There are also multiple ways to withdraw money. Account holders can get cash from a branch or ATM, plus make purchases and pay bills through a debit card, check, money order, mobile app such as Apple Pay, Samsung Pay or Google Pay. Money can also be transferred electronically into and out of checking accounts. This enables holders to pay bills electronically, transfer money between accounts, and pay friends and family through apps.

Benefits of a Savings Account

A savings account is a secure account that helps account holders save and earn money. They can be used as emergency funds, to build up for a down payment for a future home, to set aside money for a vacation, or to save money for purchases like a new car or home improvements. There are many potential uses for a savings account.

By design, money kept in a savings account is harder to spend. Federal law limits withdrawals or transfers of money out of a savings account to six per month. Savings accounts typically don’t have debit cards or checks attached to them, so account holders are likely to need to withdraw or move their savings before spending them. Savings accounts also have features to help customers accumulate funds over time: they offer interest on deposits and usually have few, if any, fees other than penalties for excess withdrawals.

Checking or Savings: Which Is Right for You?

Since these account types have different purposes, it should be simple to judge which one meets your needs. Do you want an account to make day-to-day spending convenient or do you want someplace to put aside funds for emergencies or future goals? For most people, it’s a good idea to have both.

While they offer very convenient ways to pay for things, most checking accounts are not as good for saving money. It’s just too easy to slip and spend it. And, while a savings account can accumulate more interest, the restrictions on withdrawals make them very inconvenient for normal daily use.

It isn’t difficult to open two accounts and, with online and mobile banking, it’s easier than ever to monitor and manage them. Having both a checking and savings account offers the best of both worlds — access to the money you need everyday and a secure place to put aside funds for other purposes. Even if you don’t have a future goal today that you want to fund, keep in mind that everyone should have some funds saved up to cover basic living expenses if they lose a job or to pay unexpected but necessary expenses like medical bills.

In addition, linking a savings account to a checking account can provide overdraft protection, saving you from high fees if you inadvertently spend more than you have available in checking. In addition, linking accounts makes it very simple to save. You can have a regular amount automatically transferred each month from checking into savings, preferably right after you get paid. You’ll save without even thinking about it.

Banking with Bethpage Federal Credit Union

At Bethpage, our focus is on helping our members. With a checking account from Bethpage, you get an exceptional member experience plus benefits that are hard to find anywhere else:

Bethpage Checking:

  • Easy online account opening with instant decision
  • 30,000 surcharge-free ATMs nationwide*
  • 5,000+ shared branch locations
  • You can earn 0.40% APY** for the things you do everyday
  • 24/7 Mobile Banking with Mobile Check Deposit
  • Student Checking Accounts available

Bethpage Savings:

  • ATM card for convenient withdrawals or deposits
  • Telephone banking
  • Low balance requirement — only $5
  • Range of deposit options: Direct Deposit, payroll deduction or automatic transfer from other accounts

Ready to open an account with us? It’s simple and rewarding.

Open a Checking Account
Open a Savings Account

* The owner of the ATM may impose a fee.
** Annual Percentage Yield (APY) for Bethpage Free Checking Account is 0.40%, effective as of , and is subject to change without notice. 0.40% APY will apply for each month that a member (i) is enrolled in online banking with eStatements, (ii) receives a direct deposit and (iii) makes 10 point-of-sale debit card transactions. Fees or other conditions could reduce earnings.
Bethpage Free Checking has no maintenance or activity fees. Other fees may apply.