Choosing the right bank account isn’t very difficult but it’s an extremely important part of managing your finances. You work hard for your money so you should spend it based on your values, and not waste it on bank fees. Whether you’re looking to stash your cash for the long or short term, this post will help you identify and choose the best bank account that fits your financial goals and your lifestyle.
1. Narrow down the type of bank account.
Before you can choose the right bank account, it’s important to understand the different types of accounts and how they measure up. There are multiple types of bank accounts available to consumers, some that pay a small interest and some that don’t.
While most banks offer personal checking and savings accounts, they also offer business accounts for sole-proprietors and small business owners. But for the purpose of this post we’re going to focus on personal bank accounts only.
2. Watch out for costly bank fees.
With proper money management and a bit of research, there’s pretty much never any reason you should have to pay a bank fee. Most banks offer basic checking and savings accounts for free, so you don’t have to pay a monthly maintenance fee to use your funds. In some cases you may have to adhere to specific rules, such as setting up a direct deposit, to have the monthly maintenance fee waived. But it’s usually a pretty reasonable demand.
Other fees to watch out for when choosing the right bank account include, monthly transaction limits, minimum balance requirement, service fees and ATM charges. These fees can eat into your bank balance and cause you to overpay for services that should already be included. To find out exactly what fees are associated with your bank account, check the terms and conditions and verify that everything looks good before signing on the dotted line.
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3. Look for the right terms and bonuses.
Before making the switch to a new bank, shop around for friend or family bonuses, or new customer incentives. You could receive a cash bonus for signing up using a referral, or receive other perks not publically available. It doesn’t hurt to ask and you could be rewarded with some extra money!
Other terms and perks to be on the lookout include customer bonuses for linking your checking and savings accounts, or a lower interest rate on a loan that you open with the same bank. Look for the right terms and bonuses that give you exactly what you need in the best bank account.
4. Start managing your money responsibly.
When opening a checking or savings account, you’ll need to prove your identity with a driver's license or other form of ID, and your Social Security number. So make sure you have these handy. You’ll also need to have an opening deposit, so bring a check from your other bank, or cash to get things started.
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The most important thing to remember when choosing the right bank account is to look for one that helps manage your money the best and offers perks you’ll actually use. Opt out of things like overdraft protection so you’re not tempted to overdraw your account and incur a large fee.
Keep a monthly budget going and check in on your account balance often, so you know how much money you have to spend. Set up automatic transfers from your checking account to your savings so you can start building up an emergency fund. And don’t forget about free bill pay, which usually comes with most checking accounts so you can keep track of all your bills.
In conclusion, when researching the best bank account for your personal finances, remember to review all of the fees, limitations and perks that your new account comes with. But even more importantly, practice good money habits so you can start achieving your financial goals.