A Guide to Passbook Savings Accounts
While passbook savings accounts aren’t as common as they once were, many people still enjoy using them for their simplicity. As you consider a passbook savings account, learn more about what they are and their primary benefits.
What Are Passbook Savings Accounts?
Passbook savings accounts are traditional savings accounts that come with a physical passbook. These small booklets are issued by the bank and given to account holders at account opening. When an account holder takes their passbook to the bank, they give it to a teller who uses it to record withdrawals, interest earned, and deposits. After the teller prints important information in the passbook, they give it back to the account holder, who then keeps the passbook in a safe place until the next time they need to make a withdrawal or update to the account. These accounts add another layer of security because funds cannot be taken from the account without the passbook present. However, deposits can be made to this account electronically through our online banking platform and direct deposits can also be set up to this account.
While the physical passbook is the primary quality of this type of savings account, passbook savings rates are often competitive to other interest rates. When compared to how other savings accounts work, they’re very similar as well.
Benefits of Passbook Savings Accounts
Passbook savings accounts are often thought of as a thing of the past, but they still feature several benefits that make them attractive to many people. For example, many families like to open passbook savings accounts for their children, as parents can use the savings account to help their kids learn how to manage money at a young age. People also enjoy these savings accounts for their greater simplicity and lower risk of excess spending.
Learn more about the main benefits of passbook savings accounts below:
- Greater simplicity: Account holders who prefer not to set up an online account or use an ATM often enjoy the simplicity passbooks offer. Account holders simply take their passbook to the bank, and the teller will do the rest, with the account’s balance clearly listed in the passbook. A bank passbook gives all the information about the banking activity in your account.
- Easier financial education: While older generations often enjoy using passbook savings accounts, these accounts are also perfect for families with small children. The passbook is great for teaching kids the ABCs of personal finance and how to save money. Since these accounts require a teller to sign off on any withdrawals, they also prevent children or young adults from overdrawing their accounts.
- Lower risk of excess spending: Since passbook savings accounts require account holders to come to the bank and physically withdraw money, they can help prevent impulsive spending. Every time you want to withdraw money, you’ll have to go to the branch during business hours and speak with a teller. These extra steps may give you more time to consider whether you really need to buy something, or if it would be better to keep your money in the bank.
How Do Passbook Savings Accounts Work at BayCoast Bank?
At BayCoast Bank, a $10 minimum deposit is required to open a passbook savings account and we’ll provide you with the passbook. Due to our low minimum deposit, it’s easy for anyone to open an account and keep their savings secure.
After you’ve opened the account, you’ll receive paid interest if your average daily balance is greater than $100.00 per interest posting period. We’ll also waive our monthly maintenance service charges as long as your average daily balance is greater than or equal to $100.00.