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When it comes to managing your money, choosing between a checking account and a savings account can become a bit of a balancing act. Both types of accounts offer unique benefits, and each serves a specific role. Knowing when and how to use each can help you stay on top of expenses, grow your savings, and reach your financial goals faster. In this guide, we’ll break down the differences between checking and savings accounts and answer the question: Where should your money go?

What is a checking account?

A checking account is set up for everyday spending. You can deposit funds into this account, and pay bills and make purchases. Additionally, you can use a debit card linked to your checking account to withdraw funds from an ATM and make purchases. Think of a checking account as a financial hub where money flows in and out for daily transactions. 

Benefits of a checking account:

• Receive direct deposits
• Enjoy quick access to your funds
• Make purchases with a debit card
• Withdraw cash at ATMs
• Schedule automatic bill payments linked to the account
• Ability to use checks to make purchases
• Deposit checks with the mobile app

Cons of a checking account:

• Not all checking accounts earn interest
• They may charge fees
• It can become too easy to spend money from this account

What is a savings account?

A savings account is set up to store money and earn interest on those funds. The minimum amount you need to keep in the account varies by savings account type and financial institution. Savings accounts generally earn more interest than checking accounts and are ideal for saving for emergencies or specific purposes, such as a down payment on a house or a vacation.

Benefits of a savings account:

• Usually earns interest
• Ideal for saving for emergencies or other goals
• Ability to withdraw funds from an ATM

Cons of a savings account:

• May come with fees, such as an inactivity fee
• Not as easy to access your funds as it is with a checking account

How much money should I have in my checking account vs. my savings account?

The ideal amount of money to have in a checking account versus a savings account will be different for everybody. It’s recommended to have at least two months’ worth of expenses in your checking account and three to six months’ worth of expenses in your savings account for emergencies. 

Here are some additional recommendations:

• Watch out for fees. Some checking accounts require a minimum balance or charge a monthly fee (but not our Free Checking account), so be sure you have enough in your account to cover those. See common checking account fees to avoid.
• Save more with automatic transfers. Set up automatic transfers for any additional funds in your checking account to go to your savings account to earn more interest. 
• Set up real-time account alerts. You can set up daily balance alerts or low balance alerts to help ensure you have enough in your account for expenses and avoid any potential fees.
• Explore more savings options. For longer-term savings goals, consider opening a certificate of deposit (CD), so you can potentially earn more interest on your funds. For retirement, look at opening an IRA.

Benefits of Having Both Types of Accounts

Fortunately, this isn’t an either/or situation. You can have both a checking account and a savings account to benefit from what each has to offer. Plus, you’ll be able to easily transfer funds between the two. You can have ease of access with your checking account while being able to focus on growing your money for your goals with a savings account. 

Free Checking Account in Florida

When you’re looking for a free checking account in Florida, look no further than SCCU. Our Free Checking account has no monthly maintenance fee. It also don’t require a direct deposit, but if you set one up, you can get yours up to two days early⁴²! 

We also offer an Interest Checking account, which requires only $25 to open. You’ll need to maintain a $1,500 minimum daily balance to avoid a $15 monthly low balance fee. 

Free Business Checking Account in Florida

Need a checking account in Florida for your business? You’re in luck! You can choose between a Free Business Checking account, which has no monthly maintenance fee, or a Business Interest Checking account. 

Savings Accounts at SCCU

Savings accounts at SCCU include the following types:

• Regular Savings: You only need $5 to open a regular savings account, which establishes your membership at SCCU. 
• Money Market: This type of account has a tiered interest rate model. So, the amount you earn is based on your balance. Keep in mind it requires a minimum opening deposit of $2,500 and that you must maintain this amount in your account to avoid a monthly low balance fee of $15. 
• My Way Savings: This tiered savings account can pair well with a specific savings goal, like a new car or a wedding, and provides monthly dividends. 
• SCCU Savings Cents: When you open this account, every time you use your Visa® debit card for an eligible purchase, we'll round the amount up to the nearest dollar and deposit the difference into your savings. 
• Youth Savings: This account helps your children learn how to save responsibly.
• Christmas Club Savings: Save up for the holidays stress-free with this account! On October 31, funds are automatically transferred into your savings account. 

Choosing a Credit Union for Your Savings and Checking Account in Florida

Credit unions are not-for-profit financial institutions owned by their members, offering better benefits and personalized services is at the heart of what they do. Unlike banks, their goal is not to make profits for shareholders. Credit unions like SCCU typically offer higher interest rates on savings and checking accounts with fewer fees. 

Are checking accounts and savings accounts insured at SCCU?

Yes! At SCCU, these accounts are federally insured up to $250,000 by the National Credit Union Association (NCUA), a U.S. government agency. Learn more.

Why SCCU?

Since 1951, we have proudly served our community, which now includes more than 30 counties in Florida. SCCU is the third-largest credit union in Florida, serving nearly 700,000 members with more than 60 branches and 24/7 Online and Mobile Banking services. We offer a variety of checking accounts, savings accounts, loans, and credit cards to suit your needs. 

Apply to open a Free Checking account today!