Breaking It Down: Checking Accounts

Written By CQ Team

What is a Checking Account? 🤔📚

Checking accounts are a type of bank account used to store money in the short-medium term and for your day-to-day transactions — whether that be paying a bill, depositing a paycheck and transferring some funds to your brokerage account, or wiring some money to a friend via services like Venmo or PayPal. They’re also the type of bank account that’s linked to and give us debit cards 🏦🤝💳 

Checking accounts are very liquid, meaning that they allow you to make numerous deposits/withdrawals without many fees, but they won’t give you as much, if any, interest on your money.

 

How Do I Access My Checking Account?

The funds in your account can be deposited/withdrawn through banks, both physical and online, ATMs, your debit card, or writing checks ✨For example…

  • Write a check or deposit one. 

  • Withdraw or deposit with your ATM card.

  • Visit a local branch to make withdrawals and/or deposits (with a completed bank/checking deposit slip).

  • Make purchases through the debit card connected to your account. 

  • Transfer funds between your accounts via online services.

  • Use the bank’s online bill-paying services to cover one-time expenses or set up automatic payments for recurring ones!

Online Banking 🧑‍💻

Digital/online banking has been gaining traction in our very digital world for its convenience and features that help you complete everyday banking tasks with the click of a finger and support you in learning how to manage your money! For example, mobile banking apps allow you to deposit checks, check your balances, transfer funds, and set up personalized notifications from, well, anywhere!

 

Benefits of Teen Checking!

Opening a checking account at a young age can provide an introduction to financial independence, the banking system, and money management by taking action – whether that be learning how to make new deposits, using a debit card, managing a budget, or setting up bill pay and exploring online banking platforms. By learning how to track your expenses and monitor your remaining account balance, you’ll develop useful financial skills and habits, though it’s crucial to keep an eye out for overspending and/or overdraft – taking out more than what you have in your account.

 

Be on the Lookout for Features that Make a Great Checking Account 🔭

Before you open a checking account, it’s important that you understand the different account options available to you, their Pros v.s. Cons, and the practical aspects of opening/maintaining one! Here’s a breakdown of some of those features to help you get started:

Online Banking: Are looking for an account that’s compatible with digital wallets? Take a look at the features your bank’s online/mobile banking platforms have to offer, whether that be personalized advice, savings tools, calculators, or virtual assistance/online resources that can help you better understand your finances and learn to self-serve! Don’t forget to check for security measures 🔒

Account Minimums + Fees: The best teen checking accounts should keep minimum requirements to open and maintain an account at if not near zero. Especially if you’re using your account for day-to-day transactions and still trying to navigate your financial life, keep an eye out for Make sure that your account provider’s requirements are realistic, or even better, look for one without any minimums + fees!

Ease of Access: If you’re someone who will be frequently visiting ATMs, an extensive ATM network could be really beneficial, considering that using ATMs outside your bank’s network can incur additional fees – which you should also keep an eye out for. 

Parental Controls: Most teen checking accounts will ask a parent or guardian to co-own the account, allowing them to monitor and manage it as well. Together, take a look at the features that lay down the amount of control parents/guardians can have over the teen’s financial life. Also, some providers will require that the parent co-owner is an existing account holder with their institution, so be on the lookout for those restrictions by doing that due-diligence.

Account Conversions: Some teen checking accounts will automatically convert to a standard account when you reach a certain age. Be sure to understand what will happen to your account as you get older!

Sign-Up Bonuses! While they’re not always common, banks and credit unions may have promotions that gift you cash bonuses when you open a new checking/savings account with them. To qualify for the one-time bonus, you’ll likely have to make some direct deposits and maintain that account for a couple of months.

Another Bonus, APY: Though APYs are rare and not the most crucial with teen/student checking accounts, they can definitely be a cherry on top if offered by a provider. Learning about how earning interest on your money works (and actually earning said interest 😉) can be a plus!

 
CQ Team