Open a Checking Account

Checking accounts have a variety of uses and are a necessary part of many people's banking activities. You can use them to pay bills, deposit your income, and use a debit card. Before you open one, however, you'll need to do some research on the best financial institution and type of account for your unique needs.

Steps

Finding a Financial Institution

1. Consider your own banking needs. Before finding an institution and opening an account, you'll have to narrow down what your banking needs are.
   • Think about what you will use this account for. Are you setting up direct deposit from your job? Are you tying a debit card to the account? Will you be writing a lot of checks? All these questions will be important as you move on and find a checking account that's right for you.
2. Decide on a bank or a credit union. The two main institutions you would choose between are banks and credit unions. Credit unions provide similar services to banks, except they are non-profit and democratically run by members. Each offers different perks with their checking accounts, so keep these in mind when making a decision.
   • Credit unions usually have lower fees than banks, sometimes with free checking accounts. They are known for having better service than banks as well. They also, however, have fewer rewards and lower interest rates, and they are sometimes difficult to get in to. You might also have less choice of the type of checking account you'll get there.
   • Most banks offer a wide range of checking services, and some might feel more secure with their money in an established bank. The fees on checking accounts can be high, however, and there also may be high minimum balance requirements for their accounts.
3. Investigate banks and credit unions to make sure they are insured and legitimate. Whether you decide on a bank or credit union, your first step should be making sure that an institution is properly insured and approved by the federal government. Most large institutions are a safe bet, but smaller ones might not be up to the strictest standards. It's always a good idea to check and make sure any place you put your money if properly insured.
   • For banks, visit the Federal Deposit Insurance Corporation site.
   • For credit unions, visit the National Credit Union Administration site.
4. Decide on a specific bank or union. Whether you end up choosing a bank or credit union for your checking account, you'll still have to pick from a huge variety in either category. While this may seem overwhelming, it will become much more manageable when you start narrowing down your needs to cut the list down.
   • Consider location. Is there a branch near your home or work? Also think about if you travel often. If so, you'll probably want a nationwide or even international bank so you can always find a branch nearby. If you never leave your hometown, then you can use a smaller local bank.
   • Consider if the institution charges for checks. If you plan on writing a lot of checks, it can be a big advantage for you if the institution you use offers free or low-cost checks.
   • Look at the fees at different institutions. Some banks offer great services, but hit you with charges like account maintenance fees. Always look carefully at the kinds of fees an institution will charge you before making a decision.
   • Think about the hours the institution is open. This might seem obvious, but if you work full-time, it could be very important. An institution that's only open 9-5 on weekdays might be difficult to get to if you work those hours. Look for one that's open weekends or nights if you have to.
   • Do you want to do anything besides open a checking account at this institution? If so, look at the other accounts or credit cards it offers to help you make a decision.
5. Look at the kinds of checking accounts the institution offers. When you've narrowed down your list to one or a few institutions, then look at the checking accounts each one offers. Specifics might vary between institutions but generally speaking, there are a few standard kinds of checking accounts. Think about your personal banking needs to decide which would be best for you.
   • Basic checking. These accounts are meant for people who just use their checking accounts to pay some monthly bills. They usually have low interest rates and a moderate minimum balance requirement. With these accounts there may be a limited number of checks you're allowed to write monthly before being charged a fee.
   • Free checking. Some banks and credit unions offer free checking accounts. That means no fees or minimum balance requirements, and you won't be charged for the amount of checks you write.
   • Interest-bearing accounts. These accounts will yield a relatively high interest rate. They usually require a high minimum balance or you'll be charged a monthly fee. If you're considering this kind of account, weigh the cost of maintaining that high balance against the interest you'll receive to see if it's worth it.
   • Joint accounts. These accounts are designed for use by two people, usually a couple sharing household expenses. Both people have equal access to the account.
   • Student checking. Some institutions offer special accounts for students. They usually have a low minimum balance and account-opening fee. They may also include other perks like low-cost loans and discounts on certain expenses.
6. Explore online options. Many large banks like Chase, Capital One, Wells Fargo, and others have options to open accounts completely online. If you find one of these, you can avoid visiting a branch altogether and manage your finances from your computer or mobile device.
   • Each bank has a unique process, so it is best to directly contact the institution you're interested in. They will still generally have to verify your identity with a social security number and identification.
   • Be extra careful with security if you manage your banking online. Bank sites are usually secure, but cyber thieves can hack into your computer for information. It helps to avoid saving passwords to your computer in the event of a security breach.

Opening Your Checking Account

1. Gather the necessary documents. To open any bank account, you'll usually need several documents and pieces of information to verify your identity. Make sure you have all of these before visiting an institution to avoid repeated visits.
   • Government identification. A state-issued driver's license or passport is usually required. School or work ID's are not sufficient here.
   • Your social security number. It is best to have this number memorized. If you don't know it by heart and have to write it down, be sure not to lose it and destroy it after you're done. Also don't put your name or any other information on the paper it's written on, just in case you do lose it.
   • You should also check with the specific bank before you visit to see if they require any other proof or documentation. This will avoid repeated trips to open your account.
2. Bring cash or some other form of payment. Whichever account you decide to open, it will probably have a minimum account balance. If you don't meet that minimum you'll be charged a fee. You're often given a day or so to make a deposit and bring the account up to the minimum before you're charged. You can take care of this right when you open the account if you bring the minimum amount with you.
3. Speak with a representative at the institution. When you have your documents together, visit the branch and speak to a representative. Usually tellers don't handle opening accounts, so you'll probably be referred to one of the bank managers or financial consultants. He or she will speak with you about the account you're opening and counsel you on what options are best. Plan to ask the representative any questions you might have.
   • Explain your financial and banking situation to the representative. With this information at hand, the representative can assess your needs and may be able to recommend options you didn't think of before.
   • If you've investigated the kinds of checking accounts the institution offers, mention them. The representative will be able to talk you through the pros and cons of each account.
   • Ask about any fees associated with the account, as well as the minimum balance required.
   • Ask if you can manage your banking online or over the phone. Most banks offer these services. They are much more convenient than having to visit the branch every time you need to handle your account.
4. Decide on an account and open it. After speaking with the representative and gathering all the information you can, it's time to decide which account you want. When you decide on an account, then you'll have to deposit the minimum balance and usually submit an electronic signature that will show how you'll sign checks. After this, you can order personalized checks if you want them.
   • Remember that if you plan on using a debit card, it usually takes a few days for these to come in the mail. Have cash on hand to make purchases until then.

Managing Your Account

1. Keep your account balanced. Your checkbook will come with a registry where you can record all of your transactions. Every time you write a check or make a withdrawal/deposit, mark this in your register. Add or subtract the amount to get the new balance in your account. This way, you'll avoid bouncing checks.
   • Also make sure to record the check number if you write a check. That way you'll avoid losing track of your checks.
   • There are also electronic options for balancing your account. Make a Spreadsheet for an easy way to track your spending and add up your expenses.
   • Mint.com is a website designed to manage your finances.
   • You can also check the App stores for financial managements apps like Personal Capital or Debt Minder.
2. Read your statements every month. This will ensure that you're always aware of the activity on your account. It will help prevent you from writing bad checks, and will also help you detect any fraudulent activity.
   • Be sure to either shred the statements when you're done with them or store them in a secure location. Never throw out a bank statement fully intact, or identity thieves could get your information.
3. Use caution when withdrawing money from non-bank ATMs. ATMs inside a banking branch are regulated by the Department of Financial services and protected by the bank's security. ATMs in other areas like bars or grocery stores aren't regulated the same way, and a thief could possibly get your banking information if you use one of these.
   • If you are forced to use one of these, look around the area first. If anyone around looks suspicious or seems to be watching the machine, don't use it. Guard your information as well. Use your other hand to cover the keypad as you type your pin. Count your money as soon as it comes out of the machine, without turning around. This opens you up to robbery if a thief is observing the transaction.
4. Contact the bank or credit union right away if you suspect any problems. If you lose your card or suspect any fraudulent activity, act quickly. The sooner you contact your institution the better. You can cancel your card right away to prevent anyone else from using it. You can also lock your account if there have been unauthorized charges. It is all a matter of acting quickly to prevent further financial losses.

Tips

• If your checking account balance is higher than what you need, consider transferring some to a higher interest bearing account such as a money market account.
• Keep your checking account balanced. Insufficient or bounced check fees can be significant.
• Keep your checking account balance at the required minimum to avoid paying extra charges or risk having insufficient funds.

Warnings

• Banks do check credit reports. If you have a history of delinquent accounts, you may be denied a checking account or have to open an account with a co-signer.

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