bank account
A deposit account held at a financial institution allowing deposits, withdrawals, and transfers.
Example
“She kept three months of expenses in her bank account as an emergency buffer.”
Memory Tip
BANK ACCOUNT — the foundation of personal finance. Everything flows through it.
Why It Matters
A bank account is the foundation of personal financial management, providing a secure place to store money and track spending. It enables you to build credit history, access loans at better rates, and manage cash flow for bills and emergencies.
Common Misconception
Many people believe that keeping money in a bank account guarantees it will grow through interest, but most basic checking accounts earn little to no interest. The primary benefit is safety and access, not investment returns.
In Practice
Sarah opens a checking account with an initial deposit of 500 dollars. Over the month, she deposits her 2000 dollar paycheck, withdraws 300 dollars for groceries, and transfers 200 dollars to her savings account. Her account balance is now 2000 dollars, and she can easily track all these transactions through her bank statements.
Etymology
From Italian 'banca' meaning bench — medieval money changers worked at benches.
Common Misspellings
Build a budget and track your spending
Related Terms
More in personal finance
Other personal finance terms you should know
See Also
Need help with spelling?
Instant spelling checker with dialect variants for 2,000+ words.