In the eyes of many people a bank account is a bank account. Your account is simply the way you receive payments and transact at the grocery store.
The truth is, however, that there are a variety of different kinds of accounts.

To make the most of these facilities it is important to understand exactly what the different kinds are, as well as their benefits and drawbacks.

Current or Cheque account

Perhaps the most common kind of bank account is a current account. These are designed for day-to-day life and making transactions. Depending on your income these kinds of accounts might come in a variety of types from gold cards, to platinum, titanium and black. At each level the costs of transacting are different and you get different benefits for those different costs.

At the bottom end of these accounts is a simple “transaction account”. These usually come with little to no fees and rarely charge for payments you make in store. The top level cards might come with increased monthly fees, and costs on each transaction, but in return may offer services such as eBucks, retrenchment insurance or overdraft facilities, which function as a kind of credit.

The ultimate thing about these kinds of accounts is their ease of use, and the fact that you have instant access to the money that is in them.

Savings account

Savings accounts are designed for what the name says, saving. These accounts are generally separate from a cheque account and the money saved in them may be harder to access or spend. The benefit though is that they will generally come with some kind of interest rate, allowing you to earn a small amount extra each month dependent on how much you have in them. The principal aim of a savings account is to offer you somewhere safe to store your money that you do not need to use immediately.

Savings accounts are not intended to be the way you grow your money for the long term, but are instead a middle ground between locked in investments and your cheque account. If the rainy day comes along, that money is accessible and you will be able to easily transfer it to where it can be used.

Dependent on what kind of savings account you have, and how much you are putting away in it, there will be different interest rates. You can choose whether to make single payments as necessary, or have a debit come off your account and into your savings each month. Which you choose will depend on your own unique financial situation.

An account that has regular set deposits is known as a Fixed or deposit account. These will generally have higher interest rates than the more free form savings account, and you will most likely earn extra interest the longer you save. The downside is that these accounts tend to have a notice period which you must give the bank before you can access the money, most commonly 30 days.

Business account

A business account is open only to those with businesses that are legally registered in South Africa. They are used just like a cheque card, but for the business’ expenses and incomes. From this account business owners will be able to pay salaries, and invoices and accept payments for their services.

Resident and Non-Resident account

South Africans need never know about Resident and Non-Resident accounts. These are simple transactional accounts that are designed for those who are not citizens of the country. Resident accounts require that a person be a resident in SA, but not be a citizen, whereas Non-Resident accounts are for those who live outside the country but have reason to transact here.