Which is cheaper, checking or savings accounts?

Savings accounts tend to charge lower fees overall. But you can open both accounts cheaply.

Which is safer, checking or savings accounts?

They're both FDIC insured and protected by standard bank encryption. So you're probably safe from hackers and bank failure. But checking accounts have one weakness: debit cards. If your debit card is stolen, the thief could drain your account. Federal law protects you somewhat, but you must report stolen debit cards quickly to avoid charges.

When is a checking account better than a savings account?

Checking accounts are better than savings accounts when you need to make everyday purchases from the account. Checking accounts let you withdraw money as often as you want. Some savings accounts limit your spending.

When is a savings account better than a checking account?

A savings account is better than a checking account when you want to save up for medium-term goals or build emergency savings. Savings accounts pay more interest than checking accounts, generally speaking.

Checking Account vs. Savings Account: Which Should You Pick?

More than 9 out of 10 American adults have either a checking or a savings account. The benefits are obvious: easy money transfer and storage. Checking and savings accounts are the peanut butter and jelly of personal finance: useful separately, but best when paired.

But when should you open a checking account vs. a savings account? We'll break it down.

What is a savings account?

Savings accounts help you store money you may need in the next one to five years or so. People open them because they earn you higher APYs on deposits than checking accounts. But savings accounts may limit withdrawals.

Pros of savings accounts

Higher interest rates: Savings accounts typically offer much higher interest rates than checking accounts. Online banks tend to offer the highest rates. The best high-yield savings accounts offer rates around 10 times higher than the national average.

Low minimums: Savings accounts typically require low minimum deposits, if any. Think $100 or less to open an account. (It's still "your money," but you must keep it in the account.)

FDIC insurance: Like checking accounts, savings accounts are also usually FDIC insured up to $250,000 per person per bank.

Cons of savings accounts

Withdrawal and transfer limits: Savings accounts limit you to six convenient withdrawals per month, according to Regulation D.

Feature limits: Savings accounts offer fewer features than checking accounts. It's tougher to find savings accounts that offer debit cards and check-writing capabilities.

Compare savings rates

Make sure you're getting the best account for you by comparing savings rates and promotions. Here are some of our favorite high-yield savings accounts to consider.

Account	APY	Bonus	Next Steps
Open Account for SoFi Checking and Savings On SoFi's Secure Website. Member FDIC. 4.90/5 Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor.	up to 3.80% Rate info Min. to earn: $0	Earn $50 or $400 and +0.70% Boost on Savings APY with direct deposit. Terms apply.	Open Account for SoFi Checking and Savings On SoFi's Secure Website.
Open Account for NexBank High-Yield Savings Account from Raisin On Raisin's Secure Website. Member FDIC. 4.70/5 Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor.	4.15% Rate info Min. to earn: $1	Earn up to $1,200 when you sign up and fund your account using code SUMMER26.¹	Open Account for NexBank High-Yield Savings Account from Raisin On Raisin's Secure Website.
Open Account for Happen Bank LevelUp Savings On Happen Bank's Secure Website. Member FDIC. 4.70/5 Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor.	4.00% APY with $250+ in monthly deposits Rate info Min. to earn:	N/A	Open Account for Happen Bank LevelUp Savings On Happen Bank's Secure Website.

Disclaimers

¹New customers only. Earn a cash bonus (the "Base Bonus") when you deposit and maintain funds with partner banks on the Raisin platform. Customers will receive a Base Bonus of $50 for depositing between $10,000 and $24,999; $125 for depositing between $25,000 and $49,999; $250 for depositing between $50,000 and $99,999; $500 for depositing between $100,000 and $199,999; and $1,000 for depositing $200,000 or more.

Customers may earn an additional bonus by setting up a recurring deposit within 14 days of their initial deposit (the “Recurring Deposit Bonus”). To qualify, the recurring deposit must be established within 14 days of the initial deposit date and it must execute at least two (2) times within 90-days of the initial deposit. Recurring Deposit Bonus eligibility is determined by your Base Bonus tier:

Customers depositing between $10,000–$24,999 with aggregate recurring deposits of $100 or greater receive a $10 bonus
Customers depositing between $25,000–$49,999 with aggregate recurring deposits of $250 or greater receive a $25 bonus
Customers depositing between $50,000–$99,999 with aggregate recurring deposits of $500 or greater receive a $50 bonus
Customers depositing between $100,000–$199,999 with aggregate recurring deposits of $1,000 or greater receive a $100 bonus
Customers depositing between $200,000+ with aggregate recurring deposits of $2,000 or greater receive a $200 bonus

Customers are eligible to earn the Recurring Deposit Bonus associated with their Base Bonus tier or any lower Recurring Deposit Bonus tier. For example, a customer with an initial deposit of $200,000 (qualifying for the highest Base Bonus tier) whose aggregate recurring deposits total $500, is eligible for the lower tier and will receive the $50 Recurring Deposit Bonus. However, setting up a recurring deposit greater than your Base Bonus tier's required threshold will not qualify you for a higher Recurring Deposit Bonus.

The Recurring Deposit Bonus is paid in addition to the Base Bonus. To qualify for the Base Bonus and Recurring Deposit Bonus, your first deposit must be initiated between June 1, 2026, and August 31, 2026, by 11:59 PM ET, and the promo code SUMMER26 must be entered at the time of sign-up. Only funds deposited within 14 days of the initial deposit date and maintained with partner banks on the Raisin platform for 90 days will be eligible for the Base Bonus. Bonus cash will be credited directly to your Cash Account within 30 days of meeting all qualifying terms. This offer is available to new customers only and may not be combined with any other bonus offers. Raisin may modify or end this offer at any time and may withhold or revoke bonuses in cases of fraud, abuse, or violation of these terms or Raisin’s Terms of Service.

https://www.happen.com/legal/deposits/levelup-savings-t-and-cs

What is a checking account?

Checking accounts help you spend and store money you might need tomorrow. They usually give you multiple deposit and withdrawal options so you can add and withdraw funds easily. Money kept in your checking account earns you little interest, if any.

Pros of checking accounts

Convenience: Banks and credit unions give you several ways to move your money in and out of your checking account, including:

Debit cards
Checks
Online banking

Few limitations: Checking accounts generally let you withdraw funds as often as you want. Savings accounts are typically more limited (see below).

FDIC insurance: All the checking accounts at top banks are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per person per bank. That means if your bank goes under, the FDIC will reimburse your lost funds up to a maximum of $250,000.

Cons of checking accounts

Little to no interest: Checking accounts typically don't pay you money for hoarding cash in them. If they do pay you, it's probably not much compared to top-tier savings accounts.

Fees: Checking accounts typically charge more fees than savings accounts. (They're more feature-rich.) Here are a few common checking account fees:

Monthly maintenance fee: A monthly fee you must pay to keep an account open. Many online banks don't charge these. Banks that do charge maintenance fees typically waive them if you meet certain criteria, like by setting up direct deposits to your account.
ATM fees: You must pay ATM fees to use out-of-network ATMs. These are typically $2 to $3 per withdrawal. ATM owners may charge you additional out-of-network fees.
Minimum balance charge: Some checking accounts charge you $10 to $12 if your balance drops below a certain amount.
Foreign transaction fee: If you use your debit card outside the United States, you could incur a foreign transaction fee. This often adds 3% to your purchase. Some banks charge you foreign transaction fees for banking with non-U.S. merchants, no matter where you are when you make the purchase.
Overdraft fee: Your bank may charge you $35 or so for attempting to withdraw more money than you have stashed in your checking account. Overdraft fees are typically charged by traditional brick-and-mortar banks.

Compare checking accounts

We recommend comparing checking accounts to make sure you're getting the best fit for you. Here's a list of our favorite accounts.

Account	APY	Bonus	Next Steps
Open Account for Quontic High Interest Checking On Quontic's Secure Website. Member FDIC. 4.50/5 Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor.	up to 1.10% Min. to earn: $1	High APY when you complete 10 or more qualifying debit card purchases each month	Open Account for Quontic High Interest Checking On Quontic's Secure Website.

Disclaimers

10 debit card point of sale transactions of $10 or more per statement cycle required to earn the maximum APY. If the qualifying activity requirement is not fulfilled, the interest rate paid on the entire balance will be 0.01% APY.

Saving vs. checking account: which should you pick?

Most Americans should consider opening one of each. The cheapest are essentially free and they cover different bases. Checking accounts help you cover everyday expenses, and savings accounts help you build medium- or long-term wealth.

Some online banks even offer a combined checking and savings account. Basically, it's a one-for-two combo. It's typically free, basic, and simple to manage from your smartphone. I like this because you can manage your money in one place, from a single screen.

Determined to stick with one account only? Okay. Chances are, you want to open a checking account. Checking accounts are the more flexible of the two, and they're great for managing money you may need tomorrow. Some even offer you interest on deposits.

But if you're okay with potentially facing limits on withdrawals, you should consider opening up a savings account instead. Savings accounts offer the best rates. They're great for building emergency funds and meeting medium-term goals.

Motley Fool Money's best savings accounts

Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Motley Fool Money's top savings account picks can earn you more than 10x the national average savings account rate.

Best Savings Accounts

FAQs

Savings accounts tend to charge lower fees overall. But you can open both accounts cheaply.
They're both FDIC insured and protected by standard bank encryption. So you're probably safe from hackers and bank failure. But checking accounts have one weakness: debit cards. If your debit card is stolen, the thief could drain your account. Federal law protects you somewhat, but you must report stolen debit cards quickly to avoid charges.
Checking accounts are better than savings accounts when you need to make everyday purchases from the account. Checking accounts let you withdraw money as often as you want. Some savings accounts limit your spending.
A savings account is better than a checking account when you want to save up for medium-term goals or build emergency savings. Savings accounts pay more interest than checking accounts, generally speaking.

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