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What is a Christmas account in a bank?

Submitted by Keri on Mon, 12/05/2016 - 22:38

I have heard about opening a Christmas account in a bank - What is that?

Yes, mainly 2 types of Christmas accounts are there.

Christmas club- It is a savings program which was introduced in the U.S. by banks at the time of the great depression. It is a simple way of saving money into a special savings account to meet holiday expenses. The Christmas club was very popular in the 1970s. At present, some banks still offer Christmas club.

A Christmas Savings Account- Many banks are offering a Christmas savings account to their customers. The money will be automatically transferred from your checking account every month into the Christmas Savings Account.

The total savings amount will be mailed or deposited back into your account just before the festive season. Thus, you can meet holiday expenses without facing a credit crunch.

Submitted by Sanders Patricia on Tue, 12/06/2016 - 04:57

Sanders Patricia

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Yes, I agree with Patricia. But you must also keep in mind about the drawbacks of christmas club accounts. These accounts usually have low interest rates and a high number of restrictions. You may be restricted to make withdrawals untill the account fees are paid or may encounter penalties if you withdraw the money early.

Submitted by tiarajoseph11 on Sun, 12/11/2016 - 21:57


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