Indeed, money can never be enough, and over the years, people have had different opinions and ideas about it. There is no shortcut to success! Consistency, discipline, and hard work yield rewards. In short, you need to cultivate a habit of saving and saving well. The future is always unknown, and with a savings plan, you can never regret it. That is why banks, credit units came up with the (30 Day Savings Rule). It’s merely saving what you have spent, not spending what you have saved.
With a personal account, it is possible to make a day-day transaction by depositing or withdrawing money at ease. What’s more thrilling is that you can open it through a bank or a credit union.
Additionally, with a checking account, you have easy access to your cash. You can use it to make a direct deposit, deposit checks or even pay bills.
Therefore, without much ado let’s get into the nitty-gritty of a Checking Account.
Types of Checking Accounts
There are several checking Accounts nowadays all over the globe. However, most checking accounts out there are ridiculous. Instead of banks paying you interest, you end up paying the bank fees. A good example is Bank of America, Chase Wells Fargo Citibank, and a whole lot of banks out there. These banks charge you account maintenance fees, which could be 10-15$ every single month unless you meet specific criteria. Therefore, before embarking on opening a Checking Account, you need to look at factors like cost, features, accessibility and more. You must opt into those accounts that are free but of course, keep in mind that you’ll be charged other small charges when opening them.
- Regular Checking Accounts
- Premium Checking Accounts
- Interest-Bearing Checking Accounts
- Free Checking Accounts
- Low Balance Checking Accounts
Benefits of A Checking Account
A checking account offers many benefits. First, you can easily transfer cash from one account to another. You can also receive direct deposits and make purchases. Here are such major benefits of opening a checking account.
Protection and Safety
There are various risks associated with keeping money at home. Such risks include natural calamities, robberies, fire, etc. With your money in the bank, you are assured that it is safe from such calamities. Should anything happen, then you have nothing to worry about since your cash is safeguarded. Banks ensure their money with the Federal Deposit Insurance Corporation (FDIC).
Free Checks and Convenience
When you have a checking account, you will receive free checks to help you conduct your financial transactions. Banks cash-out checks for non-clients when the check is given by that particular bank. That means you have to go to one of that bank’s offices. Furthermore, numerous banks frequently charge a liquidating expense when changing checks for non-clients.
Opening a high-return checking account allows your cash to earn interest. Depending on the account, the returns can be exceptionally high. However, you must check the requirements of a high-interest yielding checking account to ensure that you can meet them.
Free Bill Pay Accessibility
Recurrent bills are a reality of life. Meeting these financial obligations without a checking account is not only inconveniencing but also risky. With a checking account, you can automate these recurring payments such that the amount is deducted monthly from the account. This makes it simple to pay your bills on time each month without fail. A few banks permit you to set up auto-pay through their online dashboard or set it up physically at any branch.
Convenience on Debit Cards
Having a debit card enables you to carry around huge amounts of money. Many financial organizations offer security on the off chance that your card is lost or taken. Furthermore, it’s not just more secure; it’s likewise helpful to pay with a debit card. Moreover, numerous banks currently offer Visa or MasterCard debit cards to the holders of checking accounts. These permits people to use their debit cards in any place Visa or MasterCard is acknowledged, much like an ordinary credit card.
Required Information To Open A Checking Account
Opening a checking account is quite a simple process when you have all the required documents. However, you must be 18 years and above. Here is the principal information you required to open an account.
- Real Identity: You need to provide a government-issued identification card to match up the details you provide. The ID also helps the bank match your face to that on the ID to prevent cases of fraud.
- Taxpayer Number: Banks need you to have either a personal TIN (Taxpayer Identification Number) or a valid SSN (Social Security number) for checking account opening.
- Address: You have to come with a document which the bank can use to verify your address. Such proof of addresses includes a utility bill or a Post Office Box.
Steps to Open a Checking Account
Here is a step by step guide of opening a checking account.
- Get the necessary information and documentation : Before you can commence with the process, here are some of the vital documents that you require:
- Proof of identity
- Verification of Address
- Opening Deposit depending on account type
- Complete an Application : Go to the nearest bank for application completion once you have assembled the things expected to open your checking account. It is also possible to open your checking account online. A distinct credit check is done on your past financial history. This decides whether your application will be endorsed. Whenever affirmed, you will be given a record number, and your debit card and checks (whenever wanted) will be requested.
- Consent to the Account Arrangement : If you open your checking account at a branch, you will consent to the record arrangement, and other record reports as you go on with the account opening process. If you are opening the current account online, the information, you will be directed on how to provide the information which is required.
- Make Your Opening Deposit : In the branch, the customer service representative helping you will assist you in making the first deposit in order to activate your bank account. If you are doing the account opening online, you will have to deposit the cash through the means that the bank authorizes.
- Move your Direct Deposit and afterward Automatic Payments : Review your most recent sixty days of banking action or a most recent couple of months’ articulations. Also, make a note of any common or repeat payments or installments occurring in your record.
- Collect your Debit Card : Debit cards, for the most part, take 7-10 weekdays to arrive in your mailbox. When you get it via the post office, adhere to the guidelines on the card to actuate your card and tweak your PIN. If you request a checkbook, you will receive it in10-12 business days.
Best Bank To Open A Checking Account With Features and Benefits
1. Capital One Checking Account
Capital one is mainly focused on teens and children in helping them learn how banking works. As such, the bank has a checking account designed for kids. The teenagers get a debit card which they can use to make purchases. You have the ability as a parent to monitor your kid’s financial activities.
- No initial deposit
- Decent interest rates
- Focus on a high-tech involvement
- Has accounts for kids and debit cards for teens
- Free ATM use
- Best interest rates in the industry
- No minimum balance
2. Chase Total Checking
Best for customer services, Chase offers perhaps the greatest branch network in the United States with more than 5,000 branches countrywide. Furthermore, because of its size, Chase offers caters practically almost to everybody. That incorporates checking, reserve funds, contract, debit and credit cards, and speculation accounts.
Chase bank is one of a couple of financial institutions that truly lets you do the entirety of your banking under one rooftop and that streamlines your financial experience.
The greatest drawback of Chase is that, as most enormous physical banks, it charges a ton of expenses and offers miserably interest rates on investment accounts. However, it is possible to avoid a ton of these expenses if you meet the requirements.
- Has excellent customer service
- Has many physical branches
- It caters to a large category of people
- Offers streamlined financial services
- Your issues will be resolved fast thanks to the excellent customer service.
- You can walk into any of the branches for assistance.
- They offer almost all financial services under one roof.
3. Discover Checking Account
This is the best checking account bank with faster ATM accessibility. Here, there is no monthly fee charged. With the bank, you also get to receive 1%if your debit card purchases qualify for the reward. You can claim the reward on purchases up to $3,000 per month.
- No minimum opening deposit.
- No monthly account maintenance fees
- Overall low transaction fees
- Gives reward e.g. 1% cashback if you qualify up to 3000 dollars’ monthly
- Lack of interest remunerations
- 365/24/7 live customer service line
- Availability of free ATM withdrawals
- Convenience during check deposits
4. Charles Schwab Bank High Yield Investor Checking
This checking account is a great choice due to good customer services. Another great advantage with the bank is that you are not charged extra even when you use your debit card abroad.
- Offers a great banking experience
- No minimum deposit
- No monthly fees
- Boundless ATM fee refunds
- EMobile check deposit
- Substantial free-fee ATMs
- Outstanding for global travel
5. Chime Spending Account
This is another great option when it comes to offering the best Checking account is Chime Spending Account. With the bank, you get to receive your salary or any other cash deposited into your checking account earlier. The account is pretty cheap to operate since the bank does not charge any fees. You also get to receive your direct deposit funds earlier than your colleagues in other banks. However, the bank does not have any rewards. Nonetheless, it is a great option for your financial transactions.
- The bank does not charge any fees
- You get to receive your cash earlier
- It does not have an interest-bearing account
- Does not offer any rewards
- No ongoing minimum balance requirement after you deposit 5 dollars to open account
- No monthly fees
6. Varo Checking account
Another great option is the Vero Checking account. To start with, the account does not have any hidden fees. You will also receive your payments two days earlier when you receive your salary. The bank also has a saving account with a very generous interest rate.
- Has a wide coverage of 55,000 ATMs?
- ATM withdrawals are free
- You can carry out transactions abroad at no extra fees
- The account does not have a minimum balance
- It is very cheap to operate a current count with the bank
- You have access to your cash fast and conveniently form over 5,000 ATMs
7. Simple Protected Goal account
With the account, it is very easy to track your spending which in turn helps you to avoid misusing your cash. Additionally, due to this tracing feature, it is very much possible to set up your financial goals. The account helps you know how much cash you can safely spend so that your end month financial commitments will not be affected.
- The account helps you track your financial spending
- Helps you add tags and notes to help you manage your budget
- The account makes it easy to set financially goals
- Does not have any monthly fees
- No overdraft charges
8. Consumers Credit Union Free Rewards Checking
One of the features which sets this checking account apart is the high-interest rate that it offers on the checking account. However, there are some requirements that you must fulfill in order to receive or maximize your rewards. The good news is that it is quite possible to earn rewards since the system allows you to earn rewards even when you do not meet all the criteria.
- Has one of the highest paying checking account in terms of interest
- It is quite easy to earn some form of reward
- You need to deposit $5 to open an account
- Anyone can join Consumers Credit Union
- Has a wide network of branches and ATMs?
- No minimum balance requirements
- Offers high-interest rates on your checking account
9. Ally Bank Interest Checking Account
It is an easy-to-use account since it does not have monthly maintenance expenses. Another great feature with the bank is that it offers great online banking services. You also don’t need a minimum balance to open a checking account with the bank.
- Doesn’t need any minimum deposit to open an account
- Free standard checks
- 24/7 assistance
- Fee-free ATMs
- No significant rewards
- Exceptional expertise for a smooth customer experience
- Earn some interest
10. Alliant Credit Union High-Rate Checking
Another great option when it comes to a great bank where you can open your checking account is Alliant Credit Union High- Rate Checking. With the Union, you get paid an APY of 0.25% of the funds in your account. Some unions make you jump through hoops and loops to join but that is not the case with Alliant Credit as the joining process is quite easy. You can easily open a checking account with the Union if you are a member of Foster Care to Success. The body helps teens who are in the foster care system in the United States.
However, you must note though that you will not earn interest unless you make an electronic deposit in your account at least once in a month. You also have to choose electronic means as your preferred method of receiving your statements.
- With the account, you do not pay any monthly fees
- You can receive up to $20 in ATM rebates per month
- Earn interest
- You must receive electronic statements and deposit electronically at least once per month
- It is cheap to operate
- Helps you save by earning rebates
- With the account, you do not pay any monthly fees
- You can receive up to $20 in ATM rebates per month
- You earn interest.
Open A Checking Account for Bad Credit
There are many financial implications of having bad credit. First, it might difficult to get a loan, receive a credit card or worse still find it difficult to open a bank account. A bank account is very important to any person. This is because of the lack of it means that it will be very difficult to get access to important financial services. Without it, you cannot receive direct deposits from your employer, you cannot have a debit card and you cannot conduct other important financial transactions.
You might have a bad credit history which might present a challenge for you to open a checking account. Even if this might be the situation, you should not lose hope for there is some good news. The good news is that it is still possible for you to open a checking account even with bad credit!
Many banks and financial institutions check your financial history to check if they can open a bank account for you. They use credit burials to check if you have any red flags including un-cleared balances, unpaid overdrafts, and loans. The three major credit bureaus include:
Other financial institutions will use ChexSystems a company that digs further into your financial history.
1. Getting A Bank Account With Bad Credit
But as earlier stated, it is possible to open a checking account with bad reedit. Even though banks conduct background checks on your financial history, some of them do not really care about your past financial wellbeing. They offer accounts know as second chance checking accounts. These accounts are the perfect avenue to use if you want to rebuild your banking record.
Apart from giving you a chance to operate a checking account even when you have bad credit, the second chance bank accounts help you to operate a regular account in the future if you correct your financial misgivings.
You should note though that these second chance bank accounts also have their shortcomings. First, the accounts might require you to maintain a high minimum balance. Secondly, most of them are found exclusively online which means they do not have a physical branch.
Having said that, it’s important to also know that a second chance checking account always gives you a chance to operate a checking account.
2. Some of The Best Financial Institutions Which Offer Checking Accounts For Bad Credit
- Go Bank
- Wells Fargo
- Bank of America
- Peoples bank
- Radius bank
3. However, Before You opt for A Second Chance Bank Account, Here Are A Few Things That You Can Try.
Try Applying for A Regular Account at Different Banks
The reason as to why one bank refused you a checking account might not necessarily make the other bank deny you an account. Maybe bank A denied you a Choking account due to one or two unpaid overdrafts. To bank A, that might be a high-risk occurrence that warrants them to deny you an account. You might be surprised that bank B does not consider one or two unpaid overdrafts a high-risk event and might grant you a regular bank account.
Request for Chex Systems Report
It is possible to request your ChexSystems report and identify the areas that negatively affect your credit history. Work towards rectifying these areas. If you have un-cleared loans, pay them, if you have un-cleared overdrafts, clear the balances. Make sure that your financial record is as clean as possible. After rectifying the mistakes, request for the report again to ensure that your financial record is clean. After this, you can apply for a checking account.
Factors To Consider Before Opening A Checking Account
- Purpose: The purpose of an account plays a critical role in the choice of a checking account that you will open. You might decide to open a basic checking account for your everyday simple transactions. You might also opt for a more complex checking account with various reward programs. Therefore, knowing what you need from your checking account is a paramount factor that will inform your decision of opening a checking account.
- Convenience: Another factor that will inform your choice of opening a checking account is the convenience. You should check how convenient the bank account is to operate in terms of reachability; If they offer online banking services and how long it takes for you to receive your funds after a direct deposit. Also, check if the bank offers other additional services like online deposits.
- Fees: You do not want to lose money when banking. It is therefore important to shop around to find the bank with the most affordable fees. Check the annual fees, account operating fees, any and any other fees that you might be charged.
- Account Minimum: Most banks have very interesting deals to woo customers. However, most people get a rude shock when they realize that they must fulfill certain requirements in order to enjoy the advertised benefits. Therefore, before you are swept off your feet by the benefits, check at the requirements of the checking account to make sure that you can fulfill them.
- Consider going – online-only: Nowadays, there are banks that operate online only. This means that they do not have any brick and motor branches. Such banks are super cool since you conduct all your financial transactions in the comfort of your home or at the office. One downside of these types of banks though is that you have nowhere to physically launch a compliant. That is, you cannot walk into a bank to have your issue resolved. But all in all, they are a great banking option.
- Map out the nearest ATMs and branches: You do not want to walk or drive miles on end before you find your bank’s ATM. Therefore, before you settle a bank to open a checking account, it is important to check the ATM network. Some banks have ATMs almost on every corner and at other strategic places like convenience stores where they are easily accessible. You should therefore go for a bank with wide ATM network coverage.
- Customer Service: At times, you may need the bank to resolve an issue with your account. As such, you will need a customer care representative who is attentive and keen on serving you to have your issue resolved. Also, check on the avenues that you can use to reach the bank’s representatives should any need arise. Does the bank have a phone number; does it go through? Check whether you can email the bank. Customer care response is a very crucial factor to consider.
- Is The Bank Insured? : This is another great factor to consider before opening a bank. Note that all banks should be insured by the FDIC to protect the customers’ money. The insurance comes in hand should anything happen to the bank. The insurance ensures that the customers do not lose their shard earned cash.
FAQ – Frequently Ask Question
Should I have more than one checking account?
Yes. The choice to have more than one checking account solely lies in your hands as there is no limit to the number of checking accounts that you can have. If you are a couple, you can decide to have individual checking accounts and one joint account. However, if you run a business, it is prudent to have a separate checking and personal account.
Is a debit card a checking account?
No; a debit card is NOT a checking account although the two have some similarities. First, with both, you use the cash that is already in your account to make purchases. The main difference is that a checking account offers overdraft services where you can spend more than you shave in your account- but to a certain limit and often with hefty charges. On the other hand, most debit cards do not allow you to overdraw your balance.
Does Bank of America have a free checking account?
The Bank of America does not have a free checking account. But there are ways in which you can avoid paying the monthly fees. First, you can make a direct deposit of $250 per month. The second way is by making sure that your account always has a minimum balance of $1500 per day. Additionally, you can transact freely if you are younger than 24 years and a student.
Can you open a checking account online?
Yes, it is possible to open a checking account online. However, some banks require you to deposit a minimum amount so that they can activate your account. It is therefore important to check the requirements of any bank with which you want to open a checking account.
Is it safe to open a bank account online?
Yes, it is safe to open a bank account online. However, you should make sure that your bank encrypts your data and that it has secured systems. One way of knowing this s by checking whether the bank is using a http web address. Also, s=check that there is a green padlock before the http.
A checking account is very important as it helps you to organize your financial life. As such, there are many financial institutions including banks and credit unions with which you can open a checking account. However, each financial institution has their own regulations and requirements and also charge different fees. it is therefore very prudent to shop around before you settle on any financial institution to make sure that you are getting the best deal possible.
We are now confident that you have the necessary information to choose the best financial institution to operate your checking account.