Perhaps your first experience with money—other than spending it—was starting your first savings account at the local bank or credit union. With competing investment opportunities luring their customers, local savings institutions have developed a wider array of savings opportunities.

Passbook savings accounts, named for the little physical recordkeeping ledgers that are now a thing of the past and often no longer marketed as "passbook accounts," are still the type of deposit account that most people know about. These regular savings accounts are the simplest type of account to open and maintain, usually requiring minimum balances, sometimes very small, to avoid fees. They also offer immediate accessibility for both deposits and withdrawals because of expanded hours and locations of most institutions' checking features, and ATM (automated teller machine) access. The main drawback of traditional passbook accounts is that they typically pay very low interest (for banks) or dividend (for credit union) rates.

Higher rates are available with special accounts that often tie the rates they pay to various fixed-market yields. These accounts also offer a high degree of liquidity. However, the higher the rates they pay, the higher the minimum balances that they typically require to avoid fees. Minimum balances for special savings accounts typically range from $2,500 to $10,000.

Checking accounts themselves are available with interest- or dividend-paying features, again usually requiring minimum balances. Another alternative is the money market account or money market mutual fund. Here your deposits earn based on the performance of a portfolio, or mutual fund, of large money market securities such as commercial paper, Treasury bills, banker's acceptances, and negotiable certificates of deposit. These accounts require minimum balances that usually are higher than the minimums of regular savings accounts, but often pay the highest interest or dividend rates of any type of deposit account. A variation of a deposit account is the central asset account, an account that combines savings, checking, credit/debit card services, and a line of credit in one wide-reaching account. First offered by stock brokerage firms, such accounts might also include the opportunity to invest in mutual funds and retirement plans as well. Central asset accounts often have a sweep feature, which automatically invests unallocated funds into money market accounts. Statements combining its various financial transactions make this kind of account popular with investors as well.