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The Benefits of Having a Checking Account

Authored By: MIT FCU

Checking accounts offer a secure, accessible place for your funds. If you are considering opening a checking account at a bank or credit union, or you already have one, here’s what you need to know about this account’s benefits and how to best manage it. 

Easy access to your funds

You can withdraw funds from your checking account at your bank or credit union, get cash from an ATM or transfer funds to another account. You can also use the account’s debit card to pay for purchases using funds in the account. Finally, you can write a paper check, and the written amount will be withdrawn from your account when the check is deposited.

Minimal balance requirements 

Checking accounts tend to have very low minimum balance requirements. Often, you’ll only need to meet this requirement when opening your account.

Low or no maintenance fees 

Checking accounts at banks may have monthly fees, though the credit union counterparts tend to have lower, or no monthly fees. 

Interest rates

Some checking accounts offer a modest Annual Percentage Yield (APY) on deposited funds. Often, interest-bearing checking accounts will require a minimum monthly balance and/or a minimum number of monthly debit card transactions. Credit unions issue interest in the form of “dividends” because the earnings are paid on your shares of ownership. 

Easy bill-pay

Most financial institutions offer a mobile banking app and website. Use the payment dashboard on this platform to pay your monthly bills directly from your checking account. 

Convenient account management

Use your financial institution’s mobile banking app or website to access your account, view your balance, deposit checks remotely, review recent transactions, transfer funds to another account and more. 

Promotions and sign-on benefits

Lots of institutions feature special promotions and benefits for new and existing members when they open a checking account. 

Security

Funds kept in a checking account at a bank are federally insured by the FDIC for up to $250,000. Credit unions have similar protection, with federal credit unions offering government protection through the NCUSIF. State and private credit unions may be insured by the NCUSIF as well, or through their own state or private insurance.

Managing your checking account 

Managing a checking account is easy. First, know your balance at all times to avoid an overdrawn account. Next, automate by setting up automatic bill payment. Finally, keep your account funded with 1-2 months’ of living expenses to ensure you have enough funds to cover your transactions.

Your Turn: What’s your favorite benefit to having a checking account? Tell us about it in the comments.  



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