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While it may be easy just to stash your hard-earned dollars under a mattress, it’s much better to utilize a financial institution to keep that money safe. A checking account is usually your first step, as it gives you easy access to your cash and provides other advantageous features as well.

But with so many options available, you may be wondering where to start. There are many factors to consider when choosing a checking account that works best for your needs, so we’ve created this guide that runs through everything you need to know before opening an account.

What is a checking account?

A checking account offers a way for you to deposit your money at a financial institution for safekeeping and then conveniently access that money by writing a check, paying with a debit card connected to your checking account, getting cash at an automated teller machine (ATM) or transferring money online. There’s usually no limit to the number of deposits and withdrawals you make each month from a checking account, as there are with some other types of bank accounts.

There are many different types of checking accounts. Some of the more common ones include personal accounts, business accounts, student accounts and joint accounts. So regardless of your needs, there’s likely a checking account that’s right for you. And if you need to separate your money even further, you can easily open up more than one checking account.

Checking accounts are typically insured by the federal government through the Federal Deposit Insurance Corporation (FDIC). This means if for any reason your financial institution fails, the FDIC will reimburse you for the money in your checking account up to at least $250,000. Because of this, a checking account is one of the safest places you can put your cash, as long as the financial institution you choose is insured by the FDIC.

While checking accounts are extremely risk-free and convenient, they don’t offer much in the way of earning interest on your money, and in fact can sometimes come with many fees. That’s why it’s important to find a checking account that charges low fees or offers ways to waive those fees each month.

Compare checking accounts with low fees and bonuses for new customers.

How to find the best checking account

Checking accounts are easy and convenient, but you'll need to research the best choices.

When you’re looking for a checking account, there are six important features to consider: fees, balance requirements, ATM access, interest rates, overdraft policies and new account bonuses.


Financial institutions need to cover their expenses, and one way to do so is to charge fees. Many banks charge a flat monthly fee to keep a checking account open, but they often offer ways to get the fee waived if you meet certain criteria each month.

Although every checking account is different, common ways to avoid paying a monthly fee include:

  • Maintaining a minimum account balance throughout the month
  • Using your debit card a minimum number of times during the month
  • Setting up direct deposit of your paycheck
  • Linking to additional accounts at the same financial institution

Aside from monthly account fees, a checking account might also charge fees when you write a check, request a wire transfer or overdraw your account (more on that last one in a moment).

When opening a checking account, make sure you look at all the possible fees associated with your account. Ideally, you want to keep your overall costs as close to zero as you can, so make sure to do your due diligence ahead of time in order to avoid any unexpected fees.

Balance requirements

Many checking accounts require that you keep a minimum dollar amount in your account to avoid a monthly fee. This minimum monthly balance can vary widely depending on the bank and the features associated with the account, so make sure to only sign up for a checking account with a minimum monthly balance that you know you can safely maintain.

Some financial institutions will even stop services or potentially close your account if you fall below the minimum balance, so it’s important to be aware of all the terms that come with your specific checking account.

If you think it’ll be difficult to keep even a small balance in your account, you’ll find some checking accounts that don’t have a minimum balance requirement, though these accounts will likely have other fees and very limited features.

Find checking accounts with low minimum balance requirements.

ATM access

Most checking accounts come with a debit card that allows you to withdraw cash from ATMs throughout the country and potentially even worldwide. While this is an incredibly convenient way to get money quickly when you need it, there’s a good chance you’ll be charged a fee for withdrawing cash from an ATM that isn’t part of your bank or credit union’s own network of ATMs.

If you use a non-network ATM, you'll likely be charged a fee when you get cash.

ATM fees can add up quickly, so you’ll want to find a financial institution that has ATMs near both your home and workplace, along with any other spots you frequent, so you can avoid non-network ATM fees. This is one area where large national banks can have an advantage, since they often maintain extensive ATM networks.

If you can’t find a bank with convenient local ATMs and believe you’ll be using another bank’s ATM quite often as a result, look for a checking account that will reimburse ATM fees. Online-only banks, along with smaller regional banks or credit unions, often have more favorable policies when it comes to reimbursing ATM fees.

But even banks that reimburse ATM fees sometimes have a cap on the number of reimbursements per month. So make sure the checking account you select offers enough fee-free opportunities to get cash via an ATM each month.

One great option is the PNC Virtual Wallet® where you can access 18,000 ATMs around the country without a fee. Or, if a free ATM option isn’t nearby, you can be reimbursed between $5 to $20 per statement period for out-of-network ATM fees.

Interest rates

Since it’s so easy and risk-free to have a checking account, interest rates on these accounts are typically quite low, and checking accounts that do earn interest usually come with higher minimum monthly balances or fees.

Rather than compromising on features to get a checking account with a high interest rate, a better choice may be to have your money split across several different types of bank accounts.

For instance, if you open a checking account with a low monthly minimum balance and keep about one to two months’ worth of expenses in that account, you can then put the rest of your money into a savings account or a certificate of deposit, either of which earns more interest but offers less regular access to your money. You can usually even have your employer split your direct deposit so that a portion of your paycheck goes into each separate account automatically.

Most basic savings accounts and certificates of deposit are also insured by the FDIC, so you won’t be at any risk of losing your money. And if you have multiple accounts at the same financial institution, it’s generally very easy to transfer money among the different accounts online or at an ATM.

Open a new checking account that pays interest or offers zero fees.

Overdraft policies

If you plan on writing a lot of checks or using your ATM card often, you’ll want to make sure you don’t mistakenly spend more than what you have left in your account. This is known as “overdrawing” your account.

Depending on your financial institution and the amount of the overdraft, if you attempt to overdraw your account, your bank may decline the transaction — meaning the check will “bounce” back to you unpaid, or your debit card purchase won’t be accepted at the store. However, in some cases, your bank may extend a temporary line of credit to allow the transaction to still go through, especially if the overdraft amount is small.

If you write a check but don't have enough money in your checking account to cover it, you'll overdraw your account.

In these situations, you may be charged a hefty overdraft fee. This fee is important to consider when choosing a checking account, as you could easily be charged $35 every time you overdraw your account. Some checking accounts will waive a certain amount of overdraft fees each year, while other high-end accounts might not charge any fees at all.

Another option with some checking accounts is overdraft protection, which is a permanent line of credit that will automatically cover any overdrafts up to the amount of the credit line. However, you usually have to pay high interest rates when using overdraft protection.

Some checking accounts allow you to turn off the ability to overdraw your account. This means if you try to use your debit card but have insufficient funds in your account, your purchase will be declined. However, when writing a check, if there’s not enough money in your account when the recipient goes to cash the check, the bank will refuse to pay the check, and might also charge you a fee for a “bounced” check.

New account bonuses

In order to entice new customers, some financial institutions offer a bonus to people signing up for a checking account. Typically, these offers range between $50 and $200 or more, with the higher bonuses tied to accounts that charge higher monthly fees or require more activity to waive the fee.

Checking account bonuses usually require you to deposit a specific amount of money into your new account when you first open it. There may also be additional requirements in order to get the bonus, such as switching your employer’s direct deposit to the new account or making a minimum number of debit transactions within the first few months of opening the account.

For example, right now you can earn up to a $2,000 bonus with the Citi® Priority checking account. While this is a great way to get a head start on increasing your checking account balance, there are steep deposit requirements to earn the bonus.

See if you qualify for a new checking account bonus.

Where can you open a checking account?

In today’s world, there are many options when it comes to opening a checking account. Large national banks as well as smaller regional ones often have physical branches — otherwise known as brick-and-mortar banks — you can walk into and open an account. Some banks also offer the option to open a checking account online or over the phone.

Credit unions are another place to open a checking account. These are financial institutions like a bank, except they are member-owned. This means if you’re a member, you can typically open an account with lower fees and higher interest rates.

Since credit unions cater to a smaller customer base, they can offer better customer service, although they may not have as much reach as a larger bank, so you could be limited in the number of affiliated ATMs you can access for free. Also, in order to join a credit union, you need to meet the credit union’s membership requirements — which means you might need to live in a certain area, work for a specific employer or be part of a particular group.

Nowadays, there are also many online-only bank options. This means the bank doesn’t have a physical location, so you have to be comfortable with banking via the internet. But because online-only banks don’t have to spend money maintaining physical branches, they often offer fee-free checking accounts, lower minimum balances and reimbursement of ATM fees.

With an online-only checking account, you'll need to be comfortable making mobile deposits and banking online.

Before opening a checking account at any bank or credit union, it’s helpful to research the options ahead of time. Some online companies can show you multiple checking account offers all in one place. This can help you determine checking account fees, interest rates, new account bonuses and other criteria that might be important to you.

Does applying for a checking account affect your credit score?

Most financial institutions don’t pull your credit report when opening a checking account. Some might make what’s known as a “soft inquiry” to ensure a decent track record, but a soft inquiry won’t impact your credit score. Additionally, when you close a checking account, it won’t negatively impact your credit score.

The one major exception is if you enroll in overdraft protection, which is essentially a new line of credit. In that case, it’s likely that the bank will pull your credit report, which could negatively impact your credit score by a few points. Also, if you have overdraft protection and don’t repay the money after you overdraw, the default will be reported to the credit bureaus, which will definitely hurt your credit score.

Finally, while checking accounts are not included on your standard credit report, there are separate companies that specifically compile information on bank account behavior. The largest of these reporting agencies is known as ChexSystems, though there are other smaller companies as well.

When you open a checking account, it’s likely your bank or credit union will check with one of these companies to be sure you haven’t engaged in account abuse in the past. If you have, it’s possible that a financial institution will decline to open a new checking account for you.

Should you open a checking account?

Simply stated — yes. Checking accounts are safe, easy to open and easy to use, and they allow you to access your money quickly. You can also often find a checking account offering a new account bonus, which will put free money in your pocket as long as you meet the requirements.

While checking accounts do have some drawbacks — they earn little to no interest, and fees can be quite high if you’re not careful — they provide a major convenience in today’s modern world when it comes to paying bills or getting cash. So do your research and open a checking account that will provide you with the best options and make your life easier.

Learn more about checking accounts and compare offers here.

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