7 Types of Bank Accounts: Compare Features, Fees and Perks

Watch: Which bank account is right for you?

Don’t feel like reading? Watch this two-minute video to learn the basics of the common financial accounts that you can choose from.

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7 common financial accounts

Most people know what a checking and savings account is, but what if you want something with bells and whistles or just something entirely different from traditional?

Compare seven types of financial accounts that can help you organize your finances, grow your savings and spend your hard-earned dough.

1. Checking accounts

The essential and dependable, and the common yet oh-so useful, checking accounts are one of those necessary accounts most people have. Banks designed these accounts for everyday spending, and you can deposit and withdraw as often as needed. You’ll get a debit card for spending, and you can write checks or use your card to make purchases and withdraw cash on the go.

But since they’re designed to pay bills and spend, most don’t earn interest. You can find interest-bearing checking accounts, but rates aren’t as competitive as savings accounts.

2. Savings accounts

Just as you might think, a savings account is designed for saving. Banks want you to deposit money into their accounts, and in exchange, they pay you interest. Savings accounts earn interest on your deposited funds, and the amount you earn is expressed as a percentage. On average, financial institutions offer 0.38% on savings, but you can find much better rates with high-yield accounts.⁽¹⁾

However, savings accounts don’t give you spending capabilities, but they are offered by just about all financial institutions in the US.

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Need checking and savings? Check out SoFi's hybrid account

With SoFi Checking and Savings get paid up to two days early. Set up direct deposit to automatically get your paycheck up to two days early every time you get paid.

• Up to 3.80% APY on savings by meeting deposit requirements or by paying the SoFi Plus subscription fee every 30 days
• Interest compounds monthly
• $0 account or overdraft fees

Partner terms and conditions

New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period) OR $300 (with at least $5,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period). Cash bonus will be based on the total amount of Eligible Direct Deposit. If you have satisfied the Eligible Direct Deposit requirements but have not received a cash bonus in your Checking account, please contact us at 855-456-7634 with the details of your Eligible Direct Deposit. Direct Deposit Promotion begins on 12/7/2023 and will be available through 1/31/2026. Full terms at sofi.com/banking. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC. SoFi members with Eligible Direct Deposit can earn 3.80% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Eligible Direct Deposit amount required to qualify for the 3.80% APY for savings including Vaults). Members without Eligible Direct Deposit will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 1/24/25. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.

SoFi members who enroll in SoFi Plus with Eligible Direct Deposit or by paying the SoFi Plus Subscription Fee every 30 days or SoFi members with $5,000 or more in Qualifying Deposits during the 30-Day Evaluation Period can earn 3.80% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. Members without either SoFi Plus or Qualifying Deposits, during the 30-Day Evaluation Period will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 1/24/25. There is no minimum balance requirement. If you have satisfied Eligible Direct Deposit requirements for our highest APY but do not see 3.80% APY on your APY Details page the day after your Eligible Direct Deposit arrives, please contact us at 855-456-7634. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet. See the SoFi Plus Terms and Conditions at https://www.sofi.com/terms-of-use/#plus.

We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Checking & Savings Fee Sheet for details at sofi.com/legal/banking-fees/.

SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at SoFi.com/banking/fdic/sidpterms. See list of participating banks at SoFi.com/banking/fdic/participatingbanks.

We’ve partnered with Allpoint to provide you with ATM access at any of the 55,000+ ATMs within the Allpoint network. You will not be charged a fee when using an in-network ATM, however, third-party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.

Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to two days before the scheduled payment date, but may vary.

Overdraft Coverage is limited to $50 on debit card purchases only and is an account benefit available to customers with Eligible Direct Deposits of $1,000 or more during the current 30-day Evaluation Period as determined by SoFi Bank, N.A. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Members with a prior history of non-repayment of negative balances are ineligible for Overdraft Coverage.

Earn up to 4.50% Annual Percentage Yield (APY) on SoFi Savings with a 0.70% APY Boost (added to the 3.80% APY as of 8/5/25) for up to 6 months. Open a new SoFi Checking & Savings account and enroll in SoFi Plus by 9/3/25. Rates variable, subject to change. Terms apply at sofi.com/banking#2. SoFi Bank, N.A. Member FDIC.

3. Certificate of deposit

With a certificate of deposit (CD), you agree to lock your money away for a set period. In exchange, you get a fixed interest rate for the CD’s term. Most CD terms range from three months to 10 years. On average, CDs earn higher interest rates than savings accounts. If you want the most bang for your buck and you can afford to leave cash alone for a while, CDs can be a really great way to grow your savings.

The only catch is that you can’t withdraw your money before your CD matures without penalties, often around 90 to 180 days of earned interest.

4. Money market accounts

A money market account (MMA) is sort of like a savings and checking account hybrid. You’ll get spending capabilities, such as a debit card or checks, but you’ll also earn interest on your balance. For the most part, they’re classified as savings accounts, but with the added perk of being able to spend if you need to.

On the downside, MMAs are typically limited to six withdrawals per month (similar to savings), and they may require deposits of $500 or more to get started.

5. Retirement accounts

There are several different types of retirement accounts, such as 401(k)s and Traditional and Roth IRAs. Depending on the account you use, you may gain access to tax breaks, employer matching and other perks to help you secure a nest egg for retirement.

Retirement accounts often have yearly contribution limits, and you may pay penalties if you need to access funds early — and keep taxes in mind. Contributions to traditional IRAs are tax-deductible, but when you withdraw that cash, that’s when your funds are taxed. On the other hand, Roth IRAs offer tax-free distributions in retirement, but contributions are taxed.

6. Brokerage accounts

A brokerage account is an investment account designed to buy and sell investment products, including stocks, exchange-traded funds (ETFs), mutual funds and bonds. Brokerage accounts are typically offered by investment firms, which can then place trades on your behalf. Some full-service brokerage accounts also offer personalized service and financial advice through a financial advisor.

However, brokerage accounts often require an investment account to qualify, and you may have to deal with balance requirements and monthly fees.

7. Cash management accounts

With a cash management account (CMA), you can spend, save and invest in one fell swoop. CMAs have similar features to checking accounts and may come with an ATM card, a debit card and checkwriting capabilities. They also function as a savings account by offering competitive interest rates.

Brokerages are the ones that generally offer cash management accounts, so you may also be able to invest in securities using the same account. And on that same note, you may need a brokerage account to open a CMA.

Which account is right for you

Of course, the right account for you depends on your goals — and there’s a good chance you’ll have more than just one bank account.

If you want to spend your cash and pay bills, consider these:

• Checking
• Money market

If you want to save money, consider these accounts:

• Savings
• CDs
• Cash management
• Money market

If you want to invest and grow funds, consider these:

• Retirement accounts
• Brokerage accounts

Looking for more? Check out these guides

Frequently asked questions

What bank accounts are FDIC-insured?

Deposit accounts from insured institutions are federally protected up to $250,000. This coverage includes accounts like checking, savings, CDs and money market accounts. Investment accounts, however, are not covered under FDIC or NCUA insurance.

What are the four types of bank accounts?

There are more than four types of bank accounts, but the four basic options are checking, savings, CDs and money market accounts. Checking is for spending, saving is for savings, CDs are for savings and money markets are designed for spending and saving. All four options come with federal insurance, but exact fees, requirements, rates and perks depend on the bank.

What type of bank account is best?

The most classic and historically “safe” option is the savings account. They’re low risk, have insurance, earn money on your deposit and have the only real downside of limiting withdrawals (at some banks).

As people gradually needed somewhere safe to store their money, banks created savings accounts. These accounts are also how banks earn deposits that they can then lend to other consumers.

Should my first bank account be checking or savings?

For many people, their first bank account is a savings account, often set up by parents for their children. However, a checking account can be a great first bank account. They come with a debit card, are low risk and great places to store cash (you probably won’t earn interest at most banks, though).

Compare kids’ banking options if you’re looking for your kids’ first bank account.

To make sure you get accurate and helpful information, this guide has been edited by Holly Jennings as part of our fact-checking process.

Written by

Bethany Hickey

Banking editor

Bethany Hickey is the banking editor and personal finance expert at Finder, specializing in banking, lending, insurance, and crypto. Bethany’s expertise in personal finance has garnered recognition from esteemed media outlets, such as Nasdaq, MSN, Yahoo Finance, GOBankingRates, SuperMoney, AOL and Newsweek. Her articles offer practical financial strategies to Americans, empowering them to make decisions that meet their financial goals. Her past work includes articles on generational spending and saving habits, lending, budgeting and managing debt. Before joining Finder, she was a content manager where she wrote hundreds of articles and news pieces on auto financing and credit repair for CarsDirect, Auto Credit Express and The Car Connection, among others. Bethany holds a BA in English from the University of Michigan-Flint, and was poetry editor for the university’s Qua Literary and Fine Arts Magazine. See full bio

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