In today’s fast-paced world, staying on top of your finances is more important than ever. A checking account is one of the most essential tools to help you manage your money day-to-day. But what is a checking account, and how can it benefit you? Let’s break it down and help you choose the best one for your needs.
What Is A Checking Account?
A checking account is a type of deposit account held at a bank or credit union that is designed for frequent, everyday transactions. It allows you to deposit money, make withdrawals, and easily access your funds for purchases, bill payments, and transfers.
Checking accounts also provide a safe, insurance-backed place to store your money and receive paychecks and other sources of income.
Key Features Of Checking Accounts
Instant Access To Your Funds: Checking accounts let you quickly withdraw cash from ATMs, make payments with debit cards, and even write checks (hence the name “checking” account), making them ideal for handling daily expenses.
Convenient Online Banking: Most financial institutions offer online banking tools, so you can easily check your balance, transfer funds, and pay bills, all from the comfort of your home. Mobile apps take it a step further, giving you on-the-go access to your finances. They also add extra convenience and security with features like budgeting tools and account alerts.
Low Or No Fees: Many checking accounts have low or no monthly fees, especially if you maintain a minimum balance or set up direct deposit. This makes it an affordable way to manage your money.
Overdraft Protection: Some checking accounts offer overdraft protection, helping prevent declined transactions if you overspend. While convenient, it's important to understand any associated fees to avoid surprises.
Easy Record Keeping: Checking accounts help you stay organized by providing detailed monthly statements and a transaction history. These records allow you to track your spending, budget, and spot errors or fraud.
How to Choose The Right Checking Account
When searching for the best checking account, consider the following:
Insurance: You’ll always want to make sure your funds are protected. For banks, check to make sure it’s insured by the Federal Deposit Insurance Corporation (FDIC). If using a credit union, the National Credit Union Administration (NCUA) helps keep your money safe by insuring your deposits up to $250,000.
ATM Availability & Convenience: Checking accounts typically come with personal checks, debit cards, and access to ATMs. Debit cards and ATMs give direct access to the funds in your account while also providing convenient cash withdrawals. Although you can find ATMs on just about every corner, not all will be in your financial institution’s network, which means you may have to pay a small fee for withdrawing money from those terminals.
When looking for a checking account, you’ll want to ask how many fee-free ATMs are available and located near you. Bonus points if the institution has an ATM locator tool for easy searching on-the-go. Some financial institutions will even reimburse you up to a certain amount for ATM fees.
Minimum Balance Requirements & Fees: You’ll want to be aware of any other fees that may arise when having an active checking account. Some financial institutions will charge you a monthly fee for simply having the account. These can range anywhere from $0–$30. Other financial institutions may waive their fee if you maintain a minimum balance, or don’t charge a fee at all.
If you spend more money than you have in your account, you may be charged an overdraft fee. The average overdraft fee at most major banks and credit unions is about $35. When you open your checking account, ask about these penalties and if there are ways you can avoid them.
Customer Experience: Before making a final decision, consider reading customer reviews. Try and get a feel for what the experience is like for a customer with each financial institution you’re considering. You don’t want to get locked into a checking account with an institution that has a bad reputation for their service. Take a look at what service options they offer that go above and beyond the norm, like a mobile app, peer-to-peer payment services, one-on-one financial support, and more.
Interest Rates: While checking accounts typically offer lower interest rates than savings accounts, some still offer interest on your balance, which can be a nice perk.
Finding The Right Fit
The right checking account should align with your financial habits and goals. At BCU, we offer checking options designed to fit different lifestyles, all with no monthly maintenance fees or minimum balance requirements. Plus, you get access to BCU’s mobile app, which includes free financial education resources, one-on-one guidance, an ATM locator tool to find nearly 100,000 fee-free ATMs nationwide, and more.
Our most popular account, PowerPlus™ Checking, offers the flexibility of a checking account with the earnings of a savings account, and includes ATM fee reimbursements.
If you haven’t opened a checking account yet, now is a great time to find one that works for you. Learn more about our checking account options!
Ready to experience the credit union difference? Become a member of BCU!
About BCU: BCU is a not-for-profit, member-owned credit union that is fiercely dedicated to Empowering People To Discover Financial Freedom. With over $6B in assets, BCU is committed to providing a fast, easy, and secure banking experience along with extraordinary service to more than 360,000 members. The BCU field of membership includes employees and their families from Fortune 100 companies across the US and Puerto Rico. Membership is also open to individuals who live or work in Northern Illinois, Southern Wisconsin, and Puerto Rico, as well as subscribers of BCU’s wholly owned Credit Union Service Organization (CUSO), Life. Money. You.®. All BCU members enjoy lifetime access to financial services and well-being programs that inspire confidence through the brand promise “Here Today For Your Tomorrow.”
To learn more about how we can help you realize your financial dreams, visit BCU.org. For media inquiries, visit BCU.org/About-Us/Media-Relations.
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