Archive for October, 2009
Free Checking Account
When you are looking for a new checking account, you should get one that is free. You always want to find one that you do not have to pay any fees or monthly charges. There are a lot of banks out there that will happily give you a new checking account for free, so go for those. Usually, banks will charge you a certain amount of money each month if you do not qualify under a few different rules. One requirement is that you must have a minimum monthly average balance sitting in your account. Another one could be that you have a savings account with them. One thing to look for is how much they charge for certain things like non sufficient funds fees or overdraft fees. Banks will try to make overdraft protection sound nice and convenient. The flip side is that it will only burn through your money. What happens with overdraft protection is that they will link your savings account to your checking account. If you have 500 dollars in your savings account and only 25 dollars in your checking account, they will transfer money from your savings to your checking if you make a charge on your debit card over 25 dollars. Now, banks call that overdraft protection, and they charge money for that simple, automatic service. It required no effort from the bank because it is done automatically by their computers. They will usually charge you about 20 dollars per overdraft transaction. They only offer that deceptive service to try to rip you off. You could charge 50 dollars to your checking account, have a negative 25 dollar balance and then go to the bank yourself to transfer the money the same business day to your checking account and avoid the fee. But if you let the computer automatically do it for you, it will cost you money. It makes no sense besides the fact that they want to take your money from you. So make a conscious decision whether or not you want to deal with a checking account and have overdraft protection.
It is best to find a free checking account with no hidden tricks or fees. They do exist out there, so it is best to at least read a little bit of the fine print. It is a good thing to compare at least 3 different checking accounts before you make your final decision. Some banks might also have a promotion going on to entice you to open a checking account. So if they have a free checking account with good terms, you might want to go for that one because of the promotion.