Opening a new bank account is a wise decision. It is important to help build your credit and have enough savings for rainy days. It would appear to be a straightforward process; however, there are a few things you need to know when opening a new bank account. This guide will show you the best way to open a new account.
Do’s of Opening a New Bank Account
1. DO compare different banking institutions.
You must research the various banking institutions since you are entrusting them with your hard-earned money. Do not assume that a certain banking institution is a better option because they are more well-known than others.
Take time to compare the different types of accounts for each bank. List the pros and cons of each option. You must also compare it against your needs. Every individual savings account holder has a different purpose for that account. Your intended purpose will determine which bank and type of account you choose.
2. DO keep your opening deposit low.
When starting a new bank account, don’t funnel your money toward that account. Wait for a few months to see how well the account is doing and once the account is established, you can continue putting more into the account.
This approach will allow you to evaluate the features and performance of the account if it lives up to the marketing promises of the bank. Once you are happy with the account’s performance, you can add more to the account.
3. DO ask about the fees.
One of the pitfalls of opening a new savings account is the possibility that your account is charged with unnecessary fees. Banks levy certain fees on a bank account in exchange for the security of keeping your money. However, you should be wary of any hidden charges and maintenance fees that you might not know about.
Make sure to ask the bank representative about the fees you might incur to avoid them. For example, banks charge a fee if the maintaining balance of your account goes below the daily allowable limit. You could easily avoid this fee if you maintain a certain amount in your bank account and monitor it to ensure you don’t fall below the limit.
ATM fees (especially when using other ATMs) are among the most common fees with a new bank account. Take time to ask about these fees to know how much will be taken out of your account.
4. DO review your information thoroughly.
You will be provided a form to sign when opening a new bank account. Make sure you review to ensure that all the information you have provided is correct. You must correctly input the associated information into your bank account to avoid any issues when you need to make a financial transaction.
5. DO keep your password or pin safely.
The pin and password to your bank account should be kept safe and confidential at all times. Ensuring the privacy of your account information will keep unwanted people from having access to your bank account. You must also follow the best practices in choosing your password or pin.
Don’ts of Opening a New Bank Account
1. DO NOT mix your personal and business accounts.
Make sure you open separate bank accounts for various purposes, such as personal vs. business use. If you use one account for both purposes, they could easily get mixed up and it will then be difficult for you to track your personal and business finances. Keeping them separate ensures that you can use your business account for your business transactions and the personal one for your personal use or emergencies.
2. DO NOT automatically go for big banks.
It is a common misconception for most consumers to open a bank account with a big bank. They think that big banks offer more stability and are a better option. While it’s true that bigger banks are more financially stable, it does not necessarily mean they offer better products or services.
Choose a bank account type that is better suited for your personal and financial needs. Make sure you also take time to learn about the quality of their customer service.
3. DO NOT choose a zero-balance savings account.
Choosing a zero-balance savings account might be a wise option. However, it also means that you can get lower interest rates with no opportunity for your money to grow.
A savings account with a maintaining balance gives you more leverage when it comes to growing your money because of the higher interest rates. While a zero-balance account might be convenient, it isn’t always the best option.
4. DO NOT choose a bank that does not offer online banking.
Online banking allows you to monitor your savings account in real time. As long as you keep your password safe, you can use it to pay bills online or send money without going to the physical branch of your bank. It is convenient and makes monitoring your account highly efficient.
5. DO NOT be shy to ask questions.
Opening a new bank account is a big deal. You want to put your money in an account that will keep it safe and allow it to grow. If you have questions about your account options, do not hesitate to ask the bank representative. These bank representatives are willing to assist you with your concerns.
They can also recommend which type of account is ideal for your financial needs and goals. Feel free to discuss it with them, and never settle unless you are sure about your options.
