5 Things To Consider When Opening a Checking Account
As technology improves, placing your hard-earned money in a safe, reliable bank is easier than ever. Whether you’ve recently started a new job or you plan on joining a different bank, being prepared with the necessary knowledge to open a new account is essential. Let’s look over a few things to consider when it’s time to open a checking account.
Choose Between a Bank or Credit Union
Before you open a checking account, you must understand the difference between banks and credit unions. One key difference is their profit status. Banks remain for profit, which means they’re publicly traded or privately owned. Meanwhile, credit unions are nonprofit and run by its members. This results in various benefits and features for account holders or members. For example, bank account holders often face higher charge fees and interest rates, while credit union members have lower fee rates and exemption from federal taxes.
Check Your Credit Score
Something else to consider when you’re opening a checking account is your credit history. A history of irresponsible or unfavorable money management can prevent banks from accepting your request to open an account. A few other factors that can prevent you from opening a checking account include a very low credit score, leaving a previous bank on negative terms, and a history of bounced checks.
Stay Aware of Fees
When you have a checking account, you’ll have certain monthly service and maintenance fees to keep your account running and secure. ATM withdrawals, overdrafts, and late payments can result in you paying additional fees.
Bring Important Documentation
As you prepare to open a checking account, make sure you have the proper documentation prepared. Each bank is different regarding forms of identification and other documents, but a few items you may need include a valid form of ID, a money or check deposit, and your Social Security number.
Know Your Minimum Balance
Many banks require you to have a minimum balance in your account to cover maintenance fees. Because various banks and credit unions have specific minimum requirements to meet, knowing your minimum balance will prevent issues such as overdrafts and negative balances. So make sure you have a stable income to maintain your account balance.
Finding a reliable bank at which to open a checking account is essential. If you’re looking to open a checking account in Massachusetts, we at GFA Federal Credit Union can help. If you need a union that has minimum or no fees with plenty of benefits, we can provide a checking account just right for you. If you have any questions or want to get started now, contact us today for more information.