Opening a checking account offers several benefits but only if used responsibly. It’s important that you keep track of and understand how to manage your checking account. We have some important checking account tips to make sure your money is safe and to help keep you in the green.
What is a checking account?
A checking account is a type of deposit account held at a bank or other financial institution. Account holders can deposit and withdraw money into and out of their accounts freely. There’s no limit to the number of deposits and withdrawals an account holder can make. However, the account holder can only withdraw up to the balance in their account, which acts as their withdrawal limit.
Every bank sets its own terms and conditions, minimum balance requirements, fees, and other criteria. Opening a checking account is very easy if you meet the eligibility requirements. Generally, you only need an ID and the minimum amount to be deposited as a balance. You may be able to set up a checking account by visiting the nearest bank branch or submitting an online application.
Once you’ve opened a checking account, it’s important to manage it responsibly. Here are 6 things you can do.
6 Checking Account Management Tips
1. Check your balance regularly
Checking accounts allow you to make multiple deposits and withdrawals a month. While this offers a great deal of convenience, it’s easy to lose track of your total transactions as well as your account balance. This can create several issues:
- You won’t know if your account has been hacked or if the hacker has withdrawn money.
- You may accidentally overspend, leaving insufficient balance to pay your rent, credit card bills, or student loans.
- Your balance may drop below zero, resulting in unnecessary overdraft fees.
These are all expensive mistakes that can be avoided by simply taking the time to check your balance regularly. You can do this by setting email or message alerts notifying you of every transaction. Alternatively, you can log in to your online account or check your balance at any ATM.
Monitoring your account balance regularly makes it easier to spot any fraudulent charges. Reporting suspicious activity to the bank is key to limiting your liability and protecting your account from further malicious activity.
2. Review your bank statements
Your bank should send you a statement at the end of every month. This statement should list all your banking activity – deposits and withdrawals – for that month. Many of us presume these bank statements to be accurate and just ignore them. This could be a mistake.
Reviewing your bank statements is one way to monitor your bank balance, track your spending habits, and check for fraudulent activity. Do you see any charges that you don’t remember making? Are you happy with your spending habits or do you see too many unnecessary purchases? Has the bank charged you any fees and do you know why?
Taking the time to review your bank statements can offer several valuable insights that will help you improve your money management skills.
3. Automate deposits and payments
Automating recurring withdrawals such as mortgage payments, student loan payments, and subscription services can make your life much easier. You won’t need to keep track of due dates or risk missing a payment, which can damage your credit score and cost you dearly in late payment fines.
When it comes to deposits, ask your employer to deposit your paychecks directly into your account. This will save you a lot of time and trouble as you won’t need to visit the bank to deposit a check every month.
4. Avoid unnecessary fees
Every bank sets its own fees for various account-related services. Some charge a fixed monthly maintenance fee, regardless of the number of monthly transactions or account balance. Others charge a fee only for completed transactions. Still, others charge only if your balance drops below zero.
Fortunately, there are ways you can avoid unnecessary fees Look for a standard checking account that has low or no monthly maintenance fees. And make sure to maintain the minimum specified balance in your account to avoid hefty overdraft fees that can add up quickly.
5. Consolidate multiple checking accounts
Consolidating involves combining multiple checking accounts into one. This will make it easier for you to manage your finances. You won’t need to log into multiple accounts to see how much money you have in all or monitor your total deposits and withdrawals.
Managing many accounts is not just time-consuming and tedious, it also increases the risks of overlooking a crucial detail. This could lead to other problems, from unnecessary fees to a damaged credit score.
6. Download your bank’s mobile app
Most banks – not all – offer mobile apps. If your bank does, it’s a good idea to download it. A mobile banking app takes banking convenience to the next level. You can monitor your transactions and balances from anywhere and at any time as long as you’re carrying your cell phone. You can even make payments through the mobile app.
Some mobile banking apps offer additional features such as money management and budgeting tools and insights into your credit score. There’s a lot you can do with this handy tool on long bus or train rides saving you a whole lot of time while also helping you manage your money.
Are you in the midst of planning for college and need some assistance planning how you’ll pay? Our personalized College Financial Planner can help you plan ahead. And if you still need help funding the gap, use College Raptor’s Student Loan Finder to discover and compare personalized loans.
| Lender | Rates (APR) | Eligibility | |
|---|---|---|---|
 |
5.50%-16.12%* Variable
3.99%-15.61%* Fixed
|
Undergraduate and Graduate
|
VISIT CITIZENS |
 |
5.54% - 15.70% Variable
3.99% - 15.49% Fixed
|
Undergraduate and Graduate
|
VISIT SALLIE MAE |
 |
4.63% - 17.99% Variable
3.49% - 17.99% Fixed
|
Undergraduate and Graduate
|
VISIT CREDIBLE |
 |
6.00% - 13.75% Variable
3.99% - 13.75% Fixed
|
Undergraduate and Graduate
|
VISIT LENDKEY |
 |
5.66% - 14.72% Variable
3.69% - 14.56% Fixed
|
Undergraduate and Graduate
|
VISIT ASCENT |
 |
3.70% - 8.75% Fixed
|
Undergraduate and Graduate
|
VISIT ISL |
 |
5.62% - 16.85% Variable
3.69% - 16.49% Fixed
|
Undergraduate and Graduate
|
VISIT EARNEST |
 |
5.00% - 14.22% Variable
3.69% - 14.22% Fixed
|
Undergraduate and Graduate
|
VISIT ELFI |
