Why You Should Open a Checking Account

Whether you are looking for a free checking account or a great online checking account, it is important to know how checking accounts work to make an informed decision. Learning how to open a bank account online has become much more convenient than opening one in person. And comparing checking accounts has become much easier with the help of the internet. The types of financial institutions that offer checking accounts at good rates are commercial and retail banks, internet banks, credit unions and central banks.

Having a checking account offers a variety of benefits that you would not be able to get if you are just carrying cash. Having a checking account provides you with more financial protection, the ability to direct deposit your paycheck and allows you to have ease of access with online banking. Read the sections below to find out benefits to having your own checking account.

Why should you open a checking account?

One of the reasons you should get a checking account is because it provides proof of payment. A checking account will track your paper trail. Every time you swipe your debit card, you have a track record online and can see in your bank statement that you have made certain payments.

Another reason is the convenience of online banking. Most free checking accounts are online since it is one of the most modern and popular ways to manage your bank accounts. Online banking allows for bank management anywhere, especially since banks provide phone apps for an account holder’s convenience.

An additional convenience is that you can receive or spend money without cash. If you lose your cash and someone else finds it, then they can spend the money however they please. However, if your debit card has been stolen, it is possible to cut off access to by calling your bank, alerting them through a banking app or through the website for your bank.

If someone has stolen your debit card information, the best checking accounts can notify you of suspicious activity and have your account frozen for the time being.

What to Bring to Open a Bank Account

Whichever bank you decide to open your account with, they will tell you what to bring to open a bank account. Whether you are learning how to open a bank account online or opening it in person, the materials needed to open a bank account are usually the same.

Banks will request that you provide a government issued ID, proof of address and your Social Security Number. Some banks may require you to provide two forms of photo identification. You will also have to provide them with other personal information such as:

  • Date of birth.
  • Physical address.
  • Phone number.

Some banks will ask for an email address for online banking and to send promotional offers. When you get a checking account with someone else, also known as a joint account, the other person must provide the same information. Make sure they bring the materials they must provide to the bank in order to open the account.

Learn About Deposits and Fees

When you are comparing checking accounts, you need to check what fees the bank will charge and how much the deposit to open an account will be. Most banks will request for at a $25 deposit, but there are banks who will want a $5,000 deposit. It is important to verify what the bank about these deposits, so you know if it is within your range.

For account holders to make sure that they end up with the best checking account for their financial situation, account holders should check the bank’s account fees and minimums. There are several types of fees that banks can charge you and a few of them are listed below:

  • Account closing fees
  • Paper statement fees
  • Teller fees
  • Account maintenance fees
  • Minimum balance fees

Your bank account is supposed to be suitable way to keep your money safe, but that can feel misleading when you are constantly being charged a fee. Fees tend to sneak up on account holders, so compare checking accounts to make an informed decision.

How to Choose the Best Checking Account

When deciding on the best checking accounts for you, the main factors to look for are banks who pay the highest interest rates for their checking accounts and will charge the lowest fees. However, banks that offer these features are not necessarily the ones with the closest branches. These banks typically do not have many branches and will call customers.

If you are looking for a checking account and prefer the paperless option, then a free account may be the best option.  Free checking accounts are usually online banks that have no monthly fees and can offer other free services or pay interest. However, internet banks require you to mail checks with a deposit slip. Keep in mind that this process can take weeks to clear on your account.

As stated before, there are a variety of checking accounts. If you are a student, certain banks will offer checking accounts with low initial deposits and fees, alongside student-student specific perks. If you are looking for a business checking account, search for low fees but also flexible transaction policies and transaction limits.

Learn About Prepaid Cards

Prepaid debit cards allow for the user to only the spend money the user loaded on the card. Prepaid cards can be an easy and non-committal alternative to a debit card attached to a checking account. There are many types of prepaid cards available and these cards can vary in payment network, such as Visa or Mastercard, and in its uses.

There are general purpose reloadable cards, gift cards, retail cards, health savings account cards and government benefit cards. Prepaid cards are available almost anywhere and can be convenient for those who do not want to join a bank or would like to budget their money.