POSTED ON July 09, 2019
How finance folk use it
A settlement account is a bank account that is assigned for transactions. You normally assign one when you’re investing. When an investment matures or if you’re redeeming an investment, the money you’ve gained goes into your settlement account.
Is it good or bad?
Good. Thanks to settlement accounts, you don’t need to receive a check and have it converted to cash. Instead, the money goes straight to your account. It also lets you top up on your investment if it’s something like a unit investment trust fund or a time deposit.
What it means for you
Most investment options require a settlement account. Chances are, you’ll have to open one at some point. If you’re investing with a bank, they’ll help you open one which you can use as a savings account too. That means you can withdraw money you’ve gained from an investment from an ATM if you want.