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Everyone needs at least one bank account, but sometimes you can benefit from multiple, including a checking and savings account. But how do you know which is right for you?
Each account has its purpose and when used right can help you manage your finances. Use them wrong though and you could cost yourself unnecessary money or not make as much money as you wanted in interest.
Featured partner offer
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- Limited-Time Offer: Earn up to a $300 bonus and up to 4.30% APY on Savings (3.60% APY1 <p>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 <a href="https://www.sofi.com/banking/" >sofi.com/banking</a>. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC.</p><p>SoFi members with Eligible Direct Deposit can earn 3.60% 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 3.60% 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 11/12/25. There is no minimum balance requirement. Additional information can be found at <a href="http://www.sofi.com/legal/banking-rate-sheet">http://www.sofi.com/legal/banking-rate-sheet</a>.</p> with +0.70% APY Boost) for 6 Months on new accounts with eligible direct deposit. Terms Apply.2 <p>Earn up to 4.30% Annual Percentage Yield (APY) on SoFi Savings with a 0.70% APY Boost (added to the 3.60% APY as of 11/12/25) for up to 6 months. Open a new SoFi Checking & Savings account and enroll in SoFi Plus by 1/31/26. Rates variable, subject to change. Terms apply at <a href="https://www.sofi.com/banking/#2">sofi.com/banking#2</a>. SoFi Bank, N.A. Member FDIC.</p>
- No account, overdraft, or monthly fees3 <p>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 <a href="http://sofi.com/legal/banking-fees/">sofi.com/legal/banking-fees/</a></p>
- Get your paycheck up to two days early with direct deposit4 <p>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.</p>
- Access additional FDIC insurance up to $3 million5 <p><b style="font-family: Rubik, -apple-system, BlinkMacSystemFont, "Segoe UI", Roboto, "Helvetica Neue", Arial, sans-serif;">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 <a href="http://sofi.com/banking/fdic/sidpterms">SoFi.com/banking/fdic/sidpterms</a>. See list of participating banks at <a href="http://sofi.com/banking/fdic/participatingbanks">SoFi.com/banking/fdic/participatingbanks</a>.</b></p>
Checking and savings accounts compared
|
Checking accounts |
Savings accounts |
|
|
What they're for |
Convenient, frequent access to your funds |
To let money grow for financial goals |
|
Interest |
Little to none |
Typically higher than a checking account |
|
Fees |
Service/maintenance fees, ATM fees, minimum balance fees, overdraft fees, and more |
Excess transaction fees, service/maintenance fees, minimum balance fees, and more |
|
ATM access |
Yes, but you may incur fees for using an ATM out of your institution's network |
Yes, but you may incur fees for using an ATM out of your institution's network |
|
Spending options |
Most accounts issue a debit card |
Possible to request a debit card, but not normally issued |
|
Insurance protection |
Usually up to $250,000 by the FDIC or NCUA |
Usually up to $250,000 by the FDIC or NCUA |
What are checking accounts used for?
Checking accounts are everyday deposit accounts you can use to receive and spend money. Check out our lists of the best checking accounts.
Paying bills and spending money
A checking account gives you easy access to your money. You can make deposits and withdrawals, use your debit card, and make electronic transfers, usually without any limits up to the amount you have in your account.
When you open a checking account online, most banks also offer features such as online bill pay or automatic savings so you don't have to worry about forgetting to put money in your savings account.
Accessing cash quickly
Most checking accounts include a debit card that allows you access to your money via an ATM. You may even ask for cash back at the register by entering your PIN. If you use an in-network ATM, you typically won't pay any fees to access your funds. However, if you use a non-network ATM, you may pay a fee to your bank and the host bank, so always read the fine print before using it.
Transferring funds easily
If you're into technology, you may want to take advantage of digital wallets like Apple Pay or Google Pay. You may also send money to friends and family via Venmo or PayPal, each of which is easiest to use with a linked checking account. You simply enter how much you want to transfer, and the money comes out instantly, no need to mess with cash.
When you should open a savings account
Savings accounts are intended for keeping your money safe and helping it grow with interest. The best savings accounts offer interest rates that far surpass the national average of 0.40% (as of 9/15/25), according to the FDIC.6 <p class="">The product and annual percentage yield (APY) data displayed on this website is gathered from various sources and may not reflect all of the offers available in your area. Although we strive to provide the most accurate data possible, we cannot guarantee its accuracy. Always verify account details and availability with the financial institution before opening an account.<br></p>
Working toward financial goals
If you're saving your money for a special goal, such as a down payment on a house or a family vacation, it's better off in a savings account. These accounts are meant to let money sit and earn interest; they are not for everyday spending.
Saving money for emergencies
Everyone should have three to six months of expenses set aside. If you have the money in your checking account, it's easy to spend and not realize it. Putting money safely in a savings account, especially a high-yield savings account, ensures you'll have the money when your car breaks down or you have a medical emergency.
Earning interest while you save
Most savings accounts pay interest, even if it's 0.01% at a local brick-and-mortar bank, whereas many checking accounts do not pay interest. If you're trying to make your money grow to save for a big financial goal, you want an account that pays as much interest as possible to help you reach those goals.
To truly grow your savings, consider opening a high-yield savings account. HYSAs pay higher interest rates than traditional savings accounts, helping your money grow faster. Just be sure to read the fine print and understand the account minimum balance requirements to earn the higher APY.
If you're interested in earning interest from your checking account, though, here are the best high-interest checking accounts.
Accounts we recommend
Featured checking accounts
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Featured savings accounts
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Why you need a checking and savings account
You might wonder if you need a checking or savings account, but the answer is you need both.
A checking account provides daily access to your funds for everyday spending and paying your bills. You can withdraw funds as needed by writing checks, visiting an ATM, or making electronic transfers. Most checking accounts don't earn interest because the funds are meant for everyday spending.
A savings account allows you to save for long-term goals, and usually pays interest on your balance. While the Federal rule that limits the number of withdrawals to six per month for savings no longer exists, some banks charge excessive withdrawal fees or will close your account if you withdraw too often.
Having both accounts gives you the best of both worlds. You can pay your bills and set money aside for goals, such as an emergency fund, down payment on a house, or a family vacation. You can earn interest on your savings, and know how much money you have available to safely spend without affecting your long-term goals.
FAQs
How can I tell if my account is checking or savings?
If your account doesn't say "checking" or "savings" in the name, there are a few ways to tell what type of account it is. If it has a debit card, it's most likely a checking account. While it's possible for savings accounts to offer debit cards, it's not nearly as common.
Another factor to pay attention to is transaction limits. If your account limits you to a certain number of monthly transactions, often six, or enforces an "excessive withdrawal" fee, it's probably a savings account. Savings accounts also (almost) always earn interest, so this can be another indicator of what type of bank account you have. But because more and more checking accounts also offer interest, this won't work 100% of the time.
How much should I have in checking vs. savings?
You should have enough money in your checking account to cover all your monthly expenses. Any excess money should be deposited into a savings account. Personal finance experts recommend having at least three months worth of living expenses in your savings account, while some suggest having enough to live for 12 months without income.
Is a debit card a checking or savings account?
A debit card is used for purchases and withdrawals typically funded by your checking account. While it's rare, some savings accounts do offer you the ability to write checks or withdraw from an ATM. But you may have transfer or withdrawal limits per month from a savings account.
What's the difference between CDs, checking accounts, and savings accounts?
CDs, or certificates of deposit, are deposit accounts that offer a fixed interest rate for a set period of time, usually from a few months to several years. When you open a CD, you agree to keep your money in the account until the maturity date, or you may face a penalty for early withdrawal.
Checking accounts are bank accounts that allow you to make deposits and withdrawals using paper checks, debit cards, online banking, or ATMs. They are designed for everyday transactions and might not pay much interest, if any.
Savings accounts are bank accounts that typically pay interest on your deposits and let you make withdrawals up to a certain limit per month. They are meant for saving money for short-term or long-term savings goals.
Can you pay bills with a savings account?
While it may be possible to pay a bill with a savings account in some instances, savings accounts are generally intended for storing money for a long period of time. If you need to pay a bill, you can always transfer money from your savings account to your checking account and complete the transaction with your checking account.
Bottom line
The good news is that you can have a checking and savings account. You can even have multiple savings or checking accounts.
I suggest having at least one checking account for your everyday spending and bills, and a savings account for your emergency fund and other goals. If you want to separate your savings, you could even open a couple of high-yield savings or money market accounts.
Just watch the fees and minimum balance requirements on each account to ensure you don't pay unnecessary fees.
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- Earn a 3.75% Annual Percentage Yield9 <p>As of 09/23/2025, the Annual Percentage Yield (APY) of the Premium Savings Account offered by Morgan Stanley Private Bank, National Association, Member FDIC is 3.75%. Your interest rate and APY may change at any time and fees may reduce earnings. Please visit <a href="http://etrade.com/ratesheet">etrade.com/ratesheet</a> for information regarding this account's current interest rate and corresponding APY.</p> with Premium Savings
- Manage your money from anywhere with their mobile app
- No minimum initial deposit,10 <p class="">No minimum initial deposit is required to open an account. However, account must be funded within 30 days to remain open.</p> and no monthly account fees
- FDIC insured up to $500,00011 <p>The Premium Savings Account gives Morgan Stanley Private Bank, National Association, Member FDIC the ability to send any amount held on deposit in your Premium Savings Account to other depository accounts at Federal Deposit Insurance Corporation ("FDIC") member banks with the purpose of affording you additional FDIC insurance coverage. It is designed to offer up to $500,000 in FDIC coverage to individual accounts (up to $1 million for joint accounts). Certain conditions must be met. <a href="https://us.etrade.com/l/f/agreement-library/premium-savings-bank-deposit-program">Learn more</a>.</p> once certain conditions have been satisfied
