Savings vs. Current Account
This post is originally shared inside Traders Lounge Facebook group by Gandakoh in the hope of increasing financial literacy. This article includes some comments from TL members kind enough to share their knowledge.
“Savings o current maam?”
Yan lagi tinanatanong kapag nag swipe ka debit card mo sa SM or sa mga groceries stores.
Ano ba kinaiba ng dalawa? Tara pag usapan natin.
The most common and typically the first bank account that Filipinos open, a savings account is used to save money for meeting short-term or long-term financial needs, such as for investments, emergencies, and future purchases.
On the other hand, a current account (also known as checking account) is used for regular and frequent money transactions like paying bills, tuition, and rent. Government agencies and commercial banks in the Philippines require this type of bank account for repayment of personal loans or housing loans through post-dated checks. Businesses and non-profit organizations also use it to manage their cash flow efficiently.
Kapag savings account ang unang problema jan isa daily limit. You can withdraw only up to a certain amount in a single transaction and for the entire day. May bank na 20k na limit meron din 30k at meron din 50k depende sa bank mo. I remember dati na I needed more cash at dala dala ko ang debit card ay nag over the counter ako sa bank since ang need ko na cash is bigger than the daily limit ng debit card ko if sa ATM ko gamitin.
Ang savings account naman ang kagandahan ay may interest ka from banks although sobrang liit hehe. Opening a savings account usually requires a lower initial deposit than when you open a current account. Certain banks allow setting up an account with them for as low as P100 or P500.
Savings accounts also come with lower maintaining balance, typically P2,000 to P3,000 for accounts with ATM cards and P10,000 for those with passbook. You can even find savings accounts that require only a P100 or a P500 minimum monthly balance.
Yung current account naman or checking account. Sa pinas daw mas preferred pa rin sa business dealing kapag cheke. Here is the link that says that.
Yung kagandahan sa current/cheke ay wala halos limit sa withdrawal na gusto mo at kahi saan mo dalhin mas safe. Having a current account in addition to a savings account is ideal for entrepreneurs who need to separate business expenses from their personal expenses.
Opening a current account may be challenging in some banks because they require that you have a savings account with them first for a certain period (typically 3 to 6 months), so it’s ideal to set up a current account with a bank where you have an existing savings account.
Most banks in the Philippines charge higher initial deposits (P5,000 or P10,000) for opening a current account compared to a savings account. Keeping a checking account is just as expensive. For most checking accounts, you need to maintain P5,000 or P10,000 monthly. Only a few banks in the Philippines offer current accounts with P2,500 or lower.
Current accounts also come with additional penalty fees for returned and bounced checks.
Yung current account walang interest yun halos kahit maliit.
Top comments from TL family...
“As for bounce checks, dapat din po ingatan na palaging may pondo ang checking account kasi pag tumalbog ang inisyung check, magkakaroon ka din ng permanent record na reflected/reported sa lahat ng banks. It may also affect your future employment if ever hihingi ang employers ng financial records mo especially if mag aapply ka sa banks.“
–Maria Anafel Salvador
“Kung 1 million and above ang widrawal/encashment kailangang mag advice sa bank a day before if not pwedeng ma reject ang widrawal/encashment kung walang enough cash ang bank.”
“I maintain multiple banks but with less than 500k deposit para covered pa rin ni PDIC. Also para in case need money di ka confined to the maximum daily withdrawal limit. Plus checking/current account. Using CIMB as well good interest rates.”
–Jun Vidal Calarde
“Additional info, Whether it is savings/ current (checking) account, atm withdrawal has it’s everyday limit. Depende sa bank mo, pero almost all banks has 20k limit atm withdrawal everyday. Although, you can request to change your limit, and depende sa banks mo if ano need gawin para machagne un or if iaalowed nila. Para san ung limit? If incase nawala mo ung atm mo ng di mo alam, at sa kasamaang palad e nahulan nila pin mo, then the max money na pwede mawithdraw sayo that day is 20k lang, siempre if pinaataasan or pinachange mo ung limit mo, mas malaki pwede mawala. Kaya you should know the risk accompanied in changing your daily limit atm withdrawal. May mga checking/current acocunt na may atm.
Regarding sa falling below maintaining balance ( the balance you should maintain para di ka macharge na tinatawag na Service charge for falling below maintaining balance. Paano kinukuha to? Add End of day balance mo everyday and then divide by the number of days ilan sa month na un, example, june 1 eod bal + june eod bal + june 3 eod bal … / 31 = should be equal to the maintaining balance of your account )whether it is SA/CA, nakadepende yung charge sa bank, may 300/250/500/400 depende.
Sa checking/current account, may mga charges ang mga nagbounce/return checks, ( again, depende sa bank ung charges neto ) madalas na may charge na bounce/return checks are,
DAIF- draw against insufficient funds ( eto nadalas reason ng return check. Nakakalimutan mag pondo )
DAUD- draw againts uncollected deposit ( may pondo to pero di pa clear. Paano? May issuance kng 100k na cheke, ang balanse mo lang isa 10k, tapos nagdeposit ka ng cheke amounting to 500k, ung cheke na dineposit mo na 500k, di pa agad available un, it needs to be clear bago maging avaiable, so return sya as DAUD, yes may penalty )
Missing signature, closed account, unauthroized signature as reason for return, walang charges.
Clearing ng checks is 1day na lang. So if you deposited checks today, next banking days 10am ng umaga if good ung cheke na dineposit mo it should be avaialble for withdrawal.”
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