Checking accounts are accounts provided by banks and other financial institutions which allow clients to deposit funds in a federally protected account and withdraw them at will by means of cash, check, electronic debit card or ATM facility. Pre-authorized debits (i.e. rent, charge card payments and utility bills) can be automatically paid from a checking account, and it is common practice to have one´s paycheck paid into a checking account at the end of each month.
Advantages of Checking Accounts
The major advantage of a checking account is financial security. Having a checking account means that you do not have to keep large amounts of cash on your person or hidden in your home, and deposits made at most financial institutions are insured by the Federal Insurance Deposit Corporation (FDIC).
Checking accounts also give you a secure means of transferring funds to pay for goods or services. For example, if you wanted to pay a bill from a utility supplier by post, you can write a check and mail it, rather than fill an envelope with dollar bills and hope that it reaches its destination.
Online checking accounts now offer the added benefit of being able to perform transactions from the comfort of your own home over the Internet. Indeed, many financial institutions are keen to save operating costs and provide this service free of charge to their customers.
Free Checking Accounts
Many banks offer free checking accounts to their customers who deposit a minimum amount to open their checking account and maintain a set balance thereafter. “No minimum” checking accounts do exist, but often the bank will charge for providing withdrawal facilities such as ATM cards.
Some banks even provide high yield checking accounts which pay an interest percentage to customers who maintain a balance above a certain threshold. These interest rates may be tiered depending on the amount of funds that are kept in the account, or subject to minimum operating requirements.
Occasionally, banks will offer customers which fall within certain criteria the option of free lifetime checking accounts. These accounts may be time limited offers when the bank is trying to promote its services, or subject to minimum operating requirements – as with the high yield checking accounts.
Best Checking Accounts
What constitutes the best checking accounts can only be determined by the individuals´ requirements from their checking account. You may want the convenience on an online checking account and are willing to pay for the service if you cannot maintain a minimum account balance, or can get a better return on your money elsewhere which covers the fees imposed by the financial institution providing the service.
Checking accounts which have no hidden charges for using an ATM may be what some people consider the best checking account for them, while others may prefer the flexibility to go overdrawn with only minimal fees or pay a minimum of bank service charges. To recap on what checking account options may be most suitable for you, look for:-
- Free lifetime checking accounts
- Free online checking accounts
- Checking accounts with no ATM charges
- Checking accounts with no bank service charges
- High yield checking accounts
- No minimum checking accounts
Overall, provided the financial institution which is providing the checking account is insured by the FDIC, supplies a comprehensive service at minimal cost, and is transparent in all its business practices, you should not find it difficult to find the best checking account for you.