What Are Common Types of Bank Accounts?

1. Checking accounts

In basic form, a checking account allows customers to deposit money, write checks, and withdraw cash. Checking accounts let you deposit or cash checks, and many offer online services to pay bills or transfer funds. When starting your personal finance journey, a checking account should probably be your first stop. As bank accounts go, this one is a must-have. 

2. Saving accounts

These types of bank accounts are for putting aside money not used for everyday spending. A savings account usually pays an interest rate on deposits. sometimes requiring a minimum balance. It's a handy way to save more money for an emergency fund. Or to pay taxes or bills that come due later. 

3. CD accounts

A CD — a certificate of deposit — is a more specialized account. It requires customers to deposit a certain amount of money for a fixed time period, from months to years. In return, A CD usually will earn interest at higher interest rates than regular savings accounts. If you don't need quick access to your money, and want to earn more, CDs enable you to accomplish that.

4. IRAs

IRAs, short for individual retirement accounts, are important tools for retirement savings. They offer several tax advantages, and more control over investment decisions. An IRA lets you invest money in a variety of ways to fit your financial goals and risk tolerance. For the long haul, these retirement accounts are good personal finance tools — but they come with a possible early withdrawal penalty.

Overdraft fees

A financial institution may charge overdraft fees when someone overdraws their account. Amounts vary, but typically there's a $35 fee per transaction. These fees can add up quickly.

There are solutions to avoiding overdraft fees. Some banks offer overdraft protection for a small fee, even for free. Linking your checking to a savings account might also bring overdraft protection. If your checking account is overdrawn, savings are tapped to cover the difference. Or the bank may waive a fee if the overdraft is less than a certain amount, like $50. With TD's Overdraft Relief¹ you have a Grace Period², until 11 p.m. ET the next business day, to fix an overdraft.

Minimum balances

Many accounts have minimum balance requirements. For a basic checking account or savings, it's typically $25 to $100. Some banks offer exceptions for certain customers. You might get a $0 minimum requirement if you're a student, are 17-23 years old, or are over 60.

Maintenance fees

Monthly maintenance fees may be charged for several reasons. Amounts can vary quite a bit depending on account types. A maintenance fee might be charged if a balance falls below required levels. Each bank has its own policy on monthly fees, and might charge for things such as:

• Too many checks cashed or written in a month
• Excessive withdrawals from a savings account within a certain timeframe
• Exceeding or falling below a certain number of monthly transactions

If an account is dormant for too long, it could incur fees as well. Meeting a minimum balance requirement often staves off monthly maintenance fees — but not in all cases.

Account returns

For most standard checking accounts, there aren't any returns, as they typically don't offer annual percentage yields (APY). However, savings accounts do offer returns on your deposits. Most standard savings accounts provide a fixed interest rate, paid monthly or quarterly.

Interest rates

Rates of return vary quite a bit, depending on account balance, account type, and investment type. For example, a savings account might offer a standard APY of 0.01%. That usually increases along with the balance, perhaps reaching 0.50% APY for accounts over $250,000. Some banks bump your rate if you have an existing relationship with the bank or have another account with the same institution. Linking a checking account to a savings account could bump your rate an additional 1.00% or more. Depending on your balance level, the APY may even climb another 2.00% or 3.00%. Banks also might reduce interest rates on loans if you have other accounts with them.

Checking accounts at TD

TD offers several types of checking accounts. With each TD checking account, you get a contactless debit card to use at ATMs, and you'll have 24/7 mobile banking access.

• TD Complete Checking provides 3 ways to avoid the $15 monthly maintenance fee.⁴ This account allows you to waive the monthly maintenance fee on one linked personal savings account of your choice, has additional benefits for students and young adults and comes with TD's Overdraft Relief.¹
• TD Beyond Checking provides 3 ways to avoid the $25 maintenance fee.⁵ This account earns interest, and perks include waived monthly maintenance fees on all linked personal savings accounts,⁶ free checks and money orders. Also, there are no ATM fees anywhere (if you keep a $2,500 daily balance),⁷ and two overdraft fees can be automatically reversed with Overdraft Payback.⁸
• TD Essential Banking is a good, low-cost account for those who like to do business online. There's no minimum daily balance required, and a low monthly fee of $4.95. You can pay bills online, 24/7, or use your included debit card. It's a great starter account, and monthly maintenance fees are waived if you're 13-17 years old.⁹ Overdraft services are not available.¹

Saving accounts at TD Bank

TD Simple Savings offers 4 ways to waive the monthly maintenance fee. You can: link your savings account to a TD Beyond Checking account or TD Complete Checking account or maintain a $300 minimum daily balance to skip the $5 fee. Or a $25 recurring transfer from a TD Bank checking account will also waive the fee for your first year.¹⁰ And if you're 18 and under, or 62 or older, there's no monthly maintenance fee and no minimum balance requirements. This account earns interest and includes TD's Overdraft Relief.¹

TD Signature Savings could earn you more money with bump rates.¹¹ Keeping a $10,000 minimum daily balance will waive the $15 fee, as will linking an eligible¹² TD checking account. If you open this as an IRA, you also avoid the monthly fee. No ATM fees anywhere,¹³ and the account comes with TD Overdraft Relief.¹

CDs at TD Bank

TD Bank offers several standard CDs for 6 months, 12 months, and 24 months. All TD Bank CDs start with a $250 minimum initial deposit and can go to $100,000 or more. None require a monthly maintenance fee. TD offers other CDs with different terms and features. Some, like TD's Step Rate CDs and No-Catch CDs, offer limited penalty-free withdrawals.

IRAs at TD Bank

TD has 5 different IRA options to cover most anyone's needs — all feature no monthly maintenance fee.

• The TD Simple Savings IRA is great for starting your retirement savings, with a $300 minimum deposit to open
• A TD Signature Savings IRA could net you more in interest. You'll need to deposit at least $10,000 to open the account. Your interest rate will grow as your balance does. Plus, with an eligible¹⁴ TD account you can earn a rate bump
• TD Choice Promotional IRA CDs offer terms of 3 months up to 5 years and require $250 to open. A rate bump is possible if you have an eligible¹⁵ TD Checking account
• A TD IRA Add-Vantage CD lets you add to your account any time with a deposit of $500 or more. An Add-Vantage CD has a fixed term of 12 months, making rollovers easy to manage
• TD Step Rate IRA CDs offer guaranteed returns with interest rates that increase every year. Three-year and 5-year terms are available, and you can get started with only $250. At each anniversary, this CD gives the option to make a full or partial withdrawal within 10 days