The main purpose of having a salary account is to receive a monthly wage from employers. Generally, most companies offer salary accounts to their employees from the same bank where they conduct their banking transactions. Once the employee ceases to work with the company, the employee no longer enjoys the benefits associated with the salary account.
It is important to note that banks convert such accounts to a savings account if the salary is not credited for three consecutive months. You may keep the following five aspects in mind in case you wish to convert your salary account into a saving one.
1. Salary account of your new employer
You may check whether your new employer offers a salary account with the same bank as your previous employer. In case the bank is the same, you need not make the switch. Instead, you may continue with the old salary account.
2. The requirement of another account
It is imperative to identify your need for another saving account. In case your previous salary account was the only account you had, you may consider converting it to a savings one. This shall help you receive payments from investments in Systematic Investment Plans (SIPs) or dividend. Besides, you may use this account for regular payments of utility bills or for your Equated Monthly Installments (EMIs).
3. Location of the nearest bank branch
In this era of digitalization, most banks have an online presence. You may, therefore, conduct banking transactions through the internet, either on your desktop or on your mobile. However, there may be certain instances, when you are required to make physical visits to the bank branch. For this purpose, it is necessary to determine the proximity of the nearest bank branch.
4. Minimum balance requirement
Most banks do not require that account holders have a minimum balance for their salary account. Savings account, on the other hand, requires a certain amount as the minimum account balance. Failure to maintain the minimum balance may attract a penalty. It is, therefore, necessary to check beforehand the minimum balance requirement before converting your salary account.
5. Change in the communication address
Most employees provide their office address to the bank for communication purposes. Given that you are no longer working with your previous employer, you may request a change in the communication address. You may request a change of your mailing address, both e-mail as well as residential address. By doing so, bank-related activities like credit card bills, PIN number, banking passwords, and monthly statements will be sent to your new address.
Besides the aforementioned factors, you may also consider the facilities extended by the bank to your savings account. In case the bank is less responsive or is too stringent about providing facilities, you may look for an alternate bank to open an account.
The process of making the switch is quite an easy task. You may keep the above-mentioned aspects in mind and make a well-informed decision