Flaticon Icon"A penny saved is a penny earned" or so they say...

But you want to save more than a few pennies, so your piggy bank won't be enough. You need a bank account!

Ask yourself the right questions to find out which type of account meets your needs.

Why Do You Want A Bank Account?

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Do you want to...

  • not carry cash?

  • pay bills online?

  • keep your money safe?

  • make your savings grow?

Where Should You Keep Your Money?

Flaticon IconPhysical Banks:

  • They've been around the longest

  • You can visit them in person for transactions and questions

  • Many offer online banking options to make deposits, pay your bills, etc.

  • Their fees are typically higher than those of online banks and credit unions

Flaticon IconOnline Banks:

  • They're strong competitors to traditional banks

  • You can only contact them online or by phone

  • Depositing and withdrawing cash can be challenging

  • Their fees are usually lower than regular banks and credit unions

Flaticon IconCredit Unions:

  • They're non-profits and maintain strong relationships with their communities

  • You can visit them in person for transactions and questions

  • They may have limited banking services and options

  • Their fees are traditionally lower than those of physical banks

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  • Pick a bank insured by the Federal Deposit Insurance Corporation (FDIC), as that government agency will protect your deposits (up to $250,000) in case of a bank failure

  • Credit unions that are insured by the National Credit Union Administration (NCUA) offer a similar type of protection

Quiz

Ryan needs a bank. He wants to go with an online option since he's tech savvy and plans to use his phone to manage most of his transactions. But he's concerned about not having access to ATMs when he needs cash. What's the best option for him?

Online bank

Physical bank

Credit union

What Type Of Account Should You Open?

Most people have one or both of these two types of accounts:

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Checking Account

  • Best for everyday spending money

  • Allows for numerous deposits and withdrawals

  • Not much interest, if any

  • Higher fees

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Savings Account

  • Best for emergency funds

  • Allows for more limited deposits and withdrawals

  • Higher interest rates

  • Lower fees

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Some banks waive some of their fees if you keep a minimum balance and/or set up a direct deposit!

Quiz

Lucy isn't sure what kind of account she wants to open. She'd like to pay bills online, but also put away some of her monthly paycheck towards buying a car. Which account is the best fit for her needs?

Both

Savings account

Checking account

Take Action

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Are you now ready to choose a bank account?

Check out these Bytes for more banking advice:

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This Byte has been authored by

AV

Alicia Viera

Learning Experience Designer