Salary Account - Personal Finance for Engineers in India

Some of us get a placement from college and some fight for it out after graduating. Either ways the first paycheck received is always memorable. And with the first paycheck, you also take your first step of banking, finance & investment.

Savings Account / Salary Account

Most of the companies in India have tie ups with one or more banks in which you can open your salary account. Depending on the size of the company and their respective accounts the banks my wary. Some frequently asked questions at this stage is:

What is Savings Account?

In a savings bank account, bank gives you some interest (2%-6%) on the money you keep in this account. This account in India is liquid, i.e. you can withdraw the money as frequently as you want without attracting any penalties.

What is a Salary Account?

As the name suggests a salary account is a bank account where you monthly salary is credited.

Is there a difference in Savings & Salary Account?

A salary account is a savings account with some added benefits. Depending on the bank, the benefits differ. Most common benefit includes “Zero Balance”, this means bank will not charge any penalty/fees if you withdraw all your money and your account balance goes to Zero. Other benefits are preferred banking, premium debit & cred cards, easier loans etc.

Should I open a new salary account or use existing savings account?

You can convert your existing savings account to a salary account. I have maintained a single salary account across my career.

What should I look for in a bank?

There are multiple aspects you should check if you have options to choose a bank. Some of the key check list is, please note this is not a comprehensive list, but some questions that will help highlight the differences between the banks.

• What are the ATM withdrawal charges?
• What are the annual account charges?
• What are the annual Debit Card charges?
• How far is the branch located from your office & residence?

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