While checking accounts are common, they are not all the same. Some are inexpensive to maintain, while others can hit you with fees every month, eating away at your money. Here are some tips to use when choosing a checking account:
Do not be influenced by the media.
You may see a lot of commercials for a popular financial institution, but you are just starting out…a small neighborhood branch may be best. You’ll get to know the employees, and they’ll get to know you.
Choose a very low-maintenance account.
You don’t need an account that has a high balance requirement, a high monthly fee, or one that is interest-bearing. Find an account that is as simple as possible.
“Free” does not always mean free.
Read the fine print and find out whether a “free” account has hidden fees or requirements that you have to fulfill. Request a list of fees and ask your representative to explain all the features of the account.
Do a comparison online.
Many times, you can compare the features of checking accounts online and get an idea of what you like and don’t like. Then you and a parent can go to a branch and talk to a representative about the account that’s right for you.
Know how you will use the account.
Take a look at what is offered free in the account and what you have to pay for. If you plan to write a lot of checks, don’t sign up for an account that charges a per check fee. If you sometimes call to verify a deposit or a withdrawal, don’t sign up for an account that charges a fee for phone inquiries.
A check is a promise to pay someone money. You can write a check to buy something or to pay a bill; and you can receive a check from someone else for payment (their check is their promise to pay you a specific amount).
When you write a check to someone, they take it to their financial institution, which then gives them the money you have promised to pay. Their institution will then ask Andrews Federal to take the money out of your account and pay them back. It is important that you have the money in your account because if you don’t, Andrews Federal may send the check back without payment, which causes problems for the person you wrote the check to. In addition, Andrews Federal will charge you a fee for writing a check (promising to pay) without having the funds to pay it.
Similarly, when you receive a check written by someone else, you should deposit it into your account and we will credit you with the amount that is written on the check. If you want others to keep their promise to pay you, you have to make sure that you monitor your account to keep the right amount of funds to be able to pay them, too.