Things to watch out for in business savings accounts

Savings accounts are one of the simplest investment products around in the market. But there are still a lot of things that you will have to watch out for in order to prevent being surprised all of a sudden.

Introductory interest rates

These are something that any gullible run of the mill customer is going to face one time or the other. An introductory interest rate will be offered to entice the customer into opening an account and then after a few months, the rates will go back to the regular levels. And the customer will not be aware of this fact. Try to get a minimum rate guarantee for your account which will ensure that no matter what the market conditions are, your interest rate will be at a certain minimum level.

Changing names of accounts

Many banks will take you in and then change the name of your account without you being aware of the fact. You will think that you are still earning a decent interest rate when actually your account has changed and the interest rates have gone down.

Access regulations to your account

As a business man you will require instant access to your cash given the circumstances under which your company is operating. The very reason that you opened a savings account was to have liquid money at your finger tips. There are some terms that you need to know about when you open an account to prevent being unable to access your funds when you most need them. An easy access account is one where you can either have instant access or no notice access. Instant access is when you can do a withdrawal through an ATM or a bank branch without notice. No notice accounts are where you can access money through the internet or through a phone and it will take a couple of days to get hold of the money. There are a few business accounts which will require you to give up to 180 days of notice to access your funds, failing which you will have a hefty penalty levied on you.

Quoting two different interest rates

This happens too often. The gross rate is the flat amount which will be paid whereas the annual equivalent rate will take into account the interest compounded over the year. You will have to find out which rate is being quoted when you open your account in order to prevent being surprised later on.