Most people need only two bank accounts: one checking account and one savings account. This keeps things simpler and your finances easier to manage.
Savings accounts limit your access to your money, which is why they’re best for saving. Checking accounts, though, allows you easy access.
These are for spending, so they’re for paying bills, withdrawals, and so on. That’s why every person must have them.
If you’re a beginner to all these, you’re in the right place. Keep on reading for some tips on opening a checking account.
1. Know Your Needs and Frustrations
When opening a checking account, you first need to choose a bank. However, all the options can overwhelm you.
There are online banks, traditional banks, and even credit unions. Then, there are lots of options under each category.
To start choosing a bank, know your needs and frustrations first. What services are important to you? How about perks you’d like to get with your checking accounts?
Then, know what frustrates you, as well. Do you want to avoid huge fees? Do you have issues with certain features or requirements?
If you travel a lot or are online often, you may also want to use mobile banking. Check if the bank offers that as well.
Knowing what you like and don’t like will allow you to shortlist banks and the types of checking accounts.
2. Review the Features of Different Banks
Once you have a shortlist of different banks, it’s time to review their features, fees, and services. Check the minimum balance requirements and any fees, like the monthly service fee, overdraft fee, ATM fee, printed statement fee, and other fees you can incur.
You should also check out the insurance that the bank provides. Make sure it’s from either the National Credit Union Administration (NCUA) or Federal Deposit Insurance Corporation (FDIC).
The interest and rewards will also vary per institution. Check which features are more convenient or more preferable to you. The ATM network is something to consider, as well.
3. Consider a Lower Risk Account
Some banks and credit unions don’t allow you to overdraft. Meaning, you can only spend the money you have in your account. Even for online bills payment and checks, the account won’t let you overdraft.
Such accounts pose lower risks as you won’t get surprised with an overdraft fee or other common banking fees. These can go unnoticed, especially when people think they still have money they don’t have. You also cut the risk of losing your account privileges only because of some unpaid overdrafts.
Don’t hesitate to ask the bank if they have a “no-overdraft” account. Some have them but don’t market them, while others may not have them at all.
4. Visit the Bank In-Person
Modernized banks and online banks allow you to do everything online – from applying for accounts to sending e-documents. This makes for a smoother experience as you can open an account without stepping foot out of your home.
However, some people might prefer doing this process in person. If this is you, don’t hesitate to visit the bank you’re interested in. This also gives you an idea of their locations and if they have one near you.
This is also the preferred choice of other banks that are yet to modernize. In that case, you’ll have to schedule an appointment.
5. Ask the Right Questions
When you visit a location in person, prepare a set of questions to ask the teller, particularly about opening a checking account balance. Don’t hold back; opening up an account can be a long-term commitment.
Ask about all kinds of fees you can incur and how you can avoid them. Make sure you know the minimum balance requirements. And, clarify if this is for one account only or for across all accounts you have with them.
Clarify the withdrawal and transfer limits, as well. Then, ask how much are the fees if you go over the limit.
6. Look for Online and Mobile Features
Not all banks are up-to-date with recent technologies. As such, don’t expect them all to have mobile and online banking features.
A bank app is a must because it makes banking more convenient. You won’t have to fall in line to transfer money, for example, and you’ll have access to your balance at all times. Some of them will even let you deposit checks via a mobile app.
So, before you sign any contract, make sure the bank has an app you can access online or download to your phone. Seeing as how we spend an average of 6 hours and 42 minutes per day on the internet, online banking is a non-negotiable feature.
7. Prepare the Minimum Deposit
The initial deposit should matter in your decision-making because, in some banks, the opening deposit can go as high as $100. Most usually ask you to deposit around $25 to $100 to open an account.
Find out if your chosen bank and account needs a deposit and prepare that before applying. Even if you’re qualified and you have all the documents you need, you won’t be able to pursue the application without it.
Some accounts don’t require a deposit right away, though. Look for these accounts if the deposit is an issue for you.
8. Bring the Necessary Documents
To ensure a smooth process, research all the documents you need to bring when going to the bank. It’s a fairly simple process, but only if you prepare everything you need ahead of time.
Research the requirements for a checking account from your bank of choice. Remember that these may be different when you’re underaged or more than one person is opening the account.
Aside from the filled-up forms, banks usually require identification documents. In general, you’ll need a government-issued ID, SSN or TIN, and proof of address. You may also have to bring your student ID, power of attorney, or anything else for special cases.
Review Checking Accounts Before Committing
What we can take away from this is that you should review checking accounts before opening one. This ensures you get the best option for you and you’re satisfied with all the features, requirements, and terms before signing a contract.
If you have any questions, though, we’ll be happy to help. Contact us today.0