The 10 Important Questions To Ask When Choosing A Checking Account

The 10 Important Questions To Ask When Choosing A Checking Account When I opened my first checking account, I walked into my local bank branch with my paycheck and walked out with a fresh new checkbook and a feeling of confidence that I knew the basics of how this all worked.



Today, personal banking looks much different. You no longer even have to go to a physical location to open an account. And with banking innovations such as mobile payment, mobile check deposit, and online and mobile banking, you can access your money almost anywhere, at any time, and see your account balance (don't forget to subtract any purchases you've made that have not yet posted to your account).



As banking has changed, so have the factors for judging whether a checking account is right for you. What looks on paper like a low-cost account may not actually be the one that's best suited to your needs.



Whether you're opening a checking account for the first time or looking to stay more on top of the one you have, the following checklist offers 10 questions to ask; the answers you get will help explain some key features of checking accounts and help you figure out which account is right for you.

1. Can I use an ATM at no additional cost? Most institutions let you use their own ATMs with no ATM fee -- so if you are someone who uses an ATM often, it may be important to use a bank with an extensive ATM network. If the bank does not have an extensive ATM network, it's important to know whether you have to pay a fee to use ATMs operated by other banks or third parties -- or if you can be reimbursed by your bank for those fees.
   
   
   


2. What happens if I try to withdraw more money than I have in my account? Banks charge overdraft fees when you withdraw more money from your account than it actually has in it. If your bank offers an overdraft service, your withdrawal may be accepted, but typically you will also be charged a fee. Some banks, including Bank of America, don't let you overdraw your account with a debit card at the point of sale, helping you avoid these fees. While you won't be able to make the purchase right then, you also won't be charged an overdraft fee. You may also enroll in optional overdraft protection, which covers an overdraft with money from your linked savings account or a credit card, usually with a fee. Watch this video to learn more about using your debit card.
   
   
   


3. Is there a fee to maintain an account? Some banks charge monthly fees to maintain your account. However, in many cases, banks waive those charges based on certain conditions, such as maintaining a minimum balance or regular paycheck direct deposits.
   
   
   


4. Do I need to keep a certain amount of money in my account? One of the most important things to know about an account before you open it is whether you must maintain a minimum balance or an average balance to avoid a fee. You can ask your bank about its policy and under what conditions these fees may be waived.
   
   
   


5. Is there a branch nearby? Unless you don't mind doing all your banking online or over the phone, you might want to consider an institution with a branch close to your office or home. It may be worth spending some time on the bank's website to figure out what transactions will require you to visit a branch.
   
   
   


6. Can I access my account information online? Online banking has become fairly standard in recent years -- and is especially valuable if you don't live near a bank branch. If online banking is important, be sure to determine what online services your bank offers. Some banks even encourage customers to use electronic banking services by charging fees for paper statements.
   
   
   


7. Is mobile banking available? Banking has gotten more convenient with the rise of mobile apps -- which let you manage your account right from your phone. Some mobile banking apps offer lots of neat features, including the ability to deposit a check by simply taking a picture of it with your phone. However, not all mobile banking apps are created equal; you may want to look for reviews of a prospective bank's app to learn more about its functionality.
   
   
   


8. Will it cost me to transfer money? Many banks don't charge a fee when you pay bills directly from your checking account or transfer money to another bank customer. However, if you're wiring or receiving wired funds from outside the bank, there will likely be a charge. Check with your bank to see when you'll need to pay for a transfer and when you won't.
   
   
   


9. Do I have to pay for checks or replacement cards? At many banks, only your first book of checks is free. What's more, some banks limit the number of checks you can write from your account in a month and charge a fee if you exceed that number. Some also charge you to replace debit cards. Make sure you understand these costs so you don't get caught off guard.
   
   
   


10. Does the account pay me interest? Generally, if checking accounts pay interest, the rate is very low. If earning interest on your money is important to you, you may want to explore opening a savings account.

The most important thing is taking an active role in tracking and managing your finances. If you need to brush up on more financial know-how, visit BetterMoneyHabits.com for self-paced, easy-to-understand videos, tools and resources on topics from credit and budgeting to home buying and student loans. For more personal banking tips, visit the "Understanding my bank accounts" section of the site.



The material provided is for informational use only and is not intended for financial or investment advice. Bank of America and/or its partners assume no liability for any loss or damages resulting from one's reliance on the material provided. Please also note that such material is not updated regularly and that some of the information may not therefore be current. Consult with your own financial professional when making decisions regarding your financial or investment management.