What Is the Difference Between a Checking and a Savings Account?

The difference between a checking account and savings account is that money is spent from a checking account, while money being saved is placed in a savings account. The accounts can be connected to each other if requested.

Checking accounts and savings accounts are two of the more popular bank account types. A checking account is generally used for depositing funds, such as a work paycheck, and withdrawing funds to pay bills. Instruments used to make withdraws are personal checks, debit cards or automatic withdraws. If there is not enough money in the checking account to cover a withdraw request, the owner of the checking account could be charged a fee, or the withdrawal could be refused.

A savings account is a bank account used for saving money. Deposits can be made with cash, a transfer from another account, or by a direct deposit. Money deposited into savings accounts usually earns interest, and as the amount of money held in an account increases, the amount of interest earned increases as well.

When a savings account is linked to a checking account, the balance in the savings account can be used to prevent the checking account from being overdrawn, which avoids fees for overdrafts and returned items.