Are you looking to open a checking account? Opening a checking account can be a straightforward process, but you may follow the wrong path if you don’t plan it right. The process will be different depending on who you go through. You can either go through a bank you’ve been with for years or a newer startup based on your needs and preferences.
If you’re opening a Personal Checking Account for the first time, you likely have questions. Opening a checking account doesn’t have to be stressful. If you do your research and follow the steps provided, opening a report that helps you meet your financial goals is not difficult.
There are some things you’ll need to know first. Here’s what they are:
- Check Your Credit Report
Before opening a checking account, you need to ensure that your credit report is accurate and up-to-date. You are entitled to a free copy of your credit report each year. If you find any inaccuracies, dispute them right away. Otherwise, the errors will be reported on your credit report and could cause you to be rejected for a checking account.
- Find Out About ChexSystems
ChexSystems is a credit reporting agency that compiles reports about consumers’ banking histories. A lousy record with ChexSystems can prevent you from being approved for a new checking account. If you have been reported to ChexSystems because of unpaid bank fees or overdrafts, you need to resolve those issues before applying for a checking account, or you will likely be denied an account.
- Choose the Right Bank
The bank or credit union you choose must offer accounts that meet your needs and has terms and fees that are reasonable and competitive. While some banks allow customers to open accounts online, others require in-person applications at a location near you. Consider minimum balance requirements, customer service ratings, ATM accessibility, and other benefits when choosing a financial institution.
- Decide on the Bank or Financial Institution where you want to open an Account.
Decide on the type of Account you need. Checking accounts are not all the same. There are different accounts for different needs, so it is essential to understand what you want from your Account and select that best fits your needs. For example, if you’re going to earn some interest using your checking account, choose an account with a higher interest rate.
- Collect Documents
Bring all the necessary documents when opening a checking account. These include identification and proof of address required. Some banks may also need a minimum initial deposit.
- Identification – To open an account at most banks and credit unions, you’ll need to provide photo identification. A driver’s license, passport, or military ID should suffice, but each institution has its policies, so it’s best to call ahead of time and make sure.
- Social Security Number – If you don’t want Uncle Sam coming after you for taxes on any interest your bank pays you — and trust us, he will eventually find you. Then you’ll need to provide your Social Security number or Taxpayer Identification Number (TIN) when opening the Account.
- Proof of Address – This step is required for a similar reason of providing identification; the federal government wants to keep track of people. It’s crucial because many banks.
- Proof of income – such as payslips or bank statements
Fill up the application form and present all the supporting documents to your bank officers. If you’re applying for an online checking account, fill out the forms online, attach scanned copies of all required documents, and submit them on their website.
- Open Account
Once you have finished all the above processes, you will have to deposit some amount, usually around 25USD. Your Account will be functional, and you will receive your checkbook, debit card, and Account information.
The banking world has become highly competitive over the past ten years. The average consumer has many options when deciding where to open a checking account. If you’re looking to open one, you’ll want to consider your options and resist the temptation to “go with what’s easy.” To make matters worse, nearly every financial institution (bank, credit union, etc.) will offer the same or similar products and services, making it almost impossible for you to tell them apart. With all of this in mind, you need to equip yourself with information about the various checking accounts available on the market today and know how best to find and apply for a checking account tailored for your needs.