Savings accounts are those critical accounts that separate the surplus from the everyday funds. They also happen to be the first step in wealth creation and those who successfully save, have far less reliance on credit. Furthermore, it is also a good place to start for those who don’t want to pay excessive fees as many banks allow their simple savings accounts to be used as transactional accounts. We take a look at the Banco do Brasil Savings Accounts range and compare it to some of the best globally. Read more to find out how they stack up.
We recently did a review on the savings options at Chase.
About Banco do Brasil
It takes a lot for a bank to stay relevant in the financial world for over two centuries, and that is exactly what Banco do Brasil has managed to do. Founded in the early 1800’s by royalty, the bank formed an integral part of the financial industry of those times. But it hasn’t always been an easy ride for Banco do Brasil as the bank has had to face some tough times including facing bankruptcy. It managed to pull itself up again and faced this not once, but twice. The 19th century brought with it some stability and the bank was able to leverage modern banking to its advantage. Today, Banco do Brasil is the second largest banks in Brazil based on asset value and a key player on a global front.
5 Reasons Why Savings Are Important
It’s not easy to start a savings routine especially when funds are low and the economy is tough. But the ability to save does not rest on the income, but rather on the ability to live below the earner’s means. Savings are not only vital to the economy, but also to individuals. Here’s why.
Savings Prevent Unnecessary Spending On Frivolous Purchases
After shopping regret is something that many consumers face on a daily basis and it can ruin a perfectly good run to the stores. There are those moments when a little bit of retail therapy is well-deserved, but it should never be at the cost of savings or the household budget. Regret purchases are not nearly as much fun as a planned spree that has been saved for.
Savings Accounts Provide a Separate Vehicle From the Main Account
Many consumers prefer to have a standard checking account and a savings account to ensure they keep their surplus funds separate from their main transacting accounts. This ensures that they don’t overspend and use up their savings for everyday expenses. It is important to keep these separate as it also allows the consumer to stick more closely to their budget. Many consumers have more than one savings account as they start reaching their savings goals, such as building up a deposit for a property or keeping their emergency funds separate.
Savings Accounts Are Usually Protected by Government-Enforced Insurance
This may not be the case in every country, but many offer customers protection of their funds. The insurance usually covers up to a certain threshold which may not protect all the funds but at least a very big part of it for many. Investments are not always covered by the same type of insurance. Banks are also quick to advise clients that funds in savings accounts are safer than those invested, thanks to the much lower risk. The bank would need to fail in order for the customer to lose their funds or part thereof in savings accounts.
The Effect of Compound Interest
Although the interest on savings accounts may not seem much at first, the effect of compound interest is incredible over a period of time. The higher the amount deposited, the greater the effect of the compounding interest. The trick is to try and leave the funds in the account for as long as possible.
Savings Accounts Are Perfect to Teach Youth About Money Management
There are few things as exciting for children as seeing their money grow every time they make a deposit. This not only encourages saving but also teaches them about banking products which are unavoidable as an adult. Proper money management starts from an early age.
Banco do Brasil Savings Accounts Product Offerings
Banco do Brasil is a very conservative bank, however, has an even more conservative view on savings accounts. With only a few options on offer, it’s important that these strike a chord with the consumers. Let’s discover whether the range is able to pull it off. Those who want to look at the current account range should see what Banco do Brasil has to offer.
This is a simple savings account and each Banco do Brasil customer automatically has access to one. Furthermore, customers receive a competitive interest rate on the account.
- Customers are able to make additional deposits at will.
- The savings account provides access to self-service channels.
- Also, there is no personal tax on the interest.
- Customers enjoy a guarantee from the Credit Guarantee Fund.
- Finally, this account is also available to those who don’t receive a regular income.
This is the answer to the current account dilemma for pensioners, as the account is designed to receive salaries, retirements, and pensions. Furthermore, this account can only be opened in the branch that processes the payroll and at the request of the employer.
- Once the funds are in the account, an authorized party may request a transfer to a current or savings account.
- Also, the account only accepts this type of deposit.
- Finally, no checks are issued on this account.
This account is designed for those who just need a simple account to receive deposits and make payments. Furthermore, there is a monthly balance limit of $5,000.
- Customers may register for automatic bills payments such as electricity, water, telephone, and more.
- The account will be converted to another account if the limit of $5,000 per month is exceeded.
What We Like About the Banco do Brasil Savings Accounts
We’re referring to the grouping in plural, however, there really is only one savings account. This account provides customers with access to a savings tool without having to apply for it. It is open to every Banco do Brasil customer, which is a great motivation to save. Furthermore, transactions take place easily and effectively.
The interest rates on these accounts seem reasonable and fair, and those who have accounts at other institutions will find these rates highly competitive. There is also very little intervention required from customers, which makes it a simple and efficient account.
Finally, the account can be accessed through online channels and is opened immediately when the first deposit takes place. This makes it a simple and effective savings tool for those who require something that they don’t necessarily have to give much thought to.
We recently did a review on the credit cards offered by Banco do Brasil.
What We Don’t Like About the Banco do Brasil Savings Accounts
We’ve had to add in both the salary and easy accounts to bulk up the offering a little, however, they are not true savings accounts. This makes it a bit tricky because it leaves the bank with just a singular option for customers. We believe that in order for customers to have a good chance of savings, they need to have access to options. This account is by no means a drawcard for the bank. It's purely existing customers who will see the appeal in it.
The option to save doesn’t really look like it features for the bank, which means that the focus will most likely be on credit products. Customers face a mountain of debt this way. In order to create a culture that saves, banks and other financial institutions need to make savings attractive.
Critical Reviews Rating Banco do Brasil Savings Accounts – 4 of 10
Disappointment laces this review throughout as we expected more from a bank that's been around for over two centuries. There is effectively only one account available which forces customers to look elsewhere for a bit of variety. The savings account has one saving grace and that is that it is a simple account to access. All Banco do Brasil customers have immediate access to it. That gives us hope that the bank is in the mind to encourage its customers to save.
There is a lot of work for Banco do Brasil to do before this rating can improve. They will have to take their product range back to the drawing board and see what other institutions across the world offer where savings are concerned. They need to provide customers with fair choices in order to build their wealth more effectively. Not all customers are the same and therefore, their products shouldn’t have to be either. The only option at this stage for those who want something different is to invest in products that tend to carry more risk. We know this bank has weathered a lot of storms and that means they can do better. We look forward to seeing Banco do Brasil work on their savings range.
See how this range compares to the savings accounts offered by BNP Paribas.