In this article, we’re answering “What is a personal account?” This is a common question we receive from individuals looking to open their first account.
So, we decided to tackle it below, while also sharing feedback on the benefits of personal accounts and answering a few additional questions on the topic.
Fortunately, personal accounts are the same no matter where you bank in the world. So, whether you are from India or Pakistan, Canada or the United States, the following information will be relevant to you.
This article is part of our series on opening bank accounts around the world, which you can access for free following the link above.
Feel free to use the table of contents to jump ahead to the sections most relevant to you.
Table of Contents
- What Is a Personal Account?
- Benefits of Opening a Personal Account
- Frequently Asked Questions
- Do You Want Help Opening Bank Accounts?
What Is a Personal Account?
A personal bank account is a bank account used by an individual to meet their personal banking requirements. Personal accounts can include a current (or checking) account, a savings account, a fixed deposit account, and other account types.
Personal bank accounts differ from other accounts in that they are solely used by a natural person, and not a legal entity. With this in mind, individuals considering registering a business will also need to open a business bank account.
In addition to making it easier to maintain accounting records, having both a business and personal account allow the account holder to avoid any potential liability or tax consequences.
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Benefits of Opening a Personal Account
The benefits of opening a personal account include accessing financial services to manage day-to-day banking requirements, establishing a savings account to grow deposits, establishing a credit score through access to loan products, and establishing a positive relationship with a bank.
Here’s a closer look at the benefits of opening a personal account.
Benefits of a Personal Account
- Accessing financial services
- Managing day-to-day banking needs
- Establishing relationships with banks
- Building personal savings
- Establishing a credit score for future financing
- Deposit insurance on accounts (country dependent)
- And more
Frequently Asked Questions
Below are a few of the most common questions we receive from people looking into different account types. If you have further questions you would like to ask our team, don’t hesitate to get in touch.
Which Is a Personal Account?
A personal account refers to any bank account held and used by a natural person for their personal use. This can include a current (or checking) account, a savings account, a fixed deposit account, a foreign currency account, and many other types of bank accounts. Accounts that are not for individual use are either for business, commercial, merchant, or for use by public (government) enterprises.
What Are the 3 Types of Accounts?
The three different types of accounts that most banks offer to individuals include savings accounts, checking accounts, and various investment accounts. These three account types are available at most banks. However, the specific investment accounts that individuals can access can vary widely depending on the individual opening the account and the bank that they choose to open with.
Is Cash a Personal Bank Account?
Cash is not a personal bank account, but it is one method that individuals can consider to hold their savings. However, while cash is one of the most effective mediums of exchange it is not an effective store of value. This is because cash depreciates due to inflation, is susceptible to loss or theft, and does not generate any return for the holder. With this in mind, cash in a savings account earning an interest rate that is higher than inflation is often a better option than cash that still offers unrestricted access to the money deposited in the short term.
Do You Want Help Opening Bank Accounts?
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+ Plus, get YOUR most pressing bank account opening questions answered by our team!
And “yes!” GlobalBanks IQ helps foreigners and non-resident individuals open bank accounts.
In fact, GlobalBanks IQ even helps non-resident, foreign & offshore entities open bank accounts.
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