To Open a Checking Account...

Are you thinking about opening a checking account? Here are some facts you can use. You will find several kinds of checking accounts at the bank. Choosing the right account is important. Most banks have special accounts for older people and accounts with low minimum balances or free check writing.

To open an account, you need to show who you are, your Social Security number, and where you live. A driver's license or state ID will do all three things. If your address has changed, the bank may accept a utility bill to prove your address.

Every bank will check your banking record. And many banks will also check your credit report. After banks see your report, they will decide whether you may open an account. Banks will reject you if you still owe a bank for bad checks you wrote. You can clear your bad banking record. Visit your old bank. Ask them what to do to settle your old account. Banks will also tell you who to contact if you have questions about your credit report.

Very few banks offer special accounts for people on public aid. These accounts may offer good deals on checks and low fees. Try to find the bank with those special accounts. You will save money and still get the same bank's service.

Many accounts charge you a monthly fee. Others require you to keep at least a certain amount of money in the account at all times. If the balance in your account drops below this amount, you will be charged a fee.

You also have to know the other fees banks charge. Keep track of these fees so you won't get in trouble later on. Banks often charge fees for printing checks, using the ATM, writing checks, and buying money orders. Banks charge extra fees for closing an account, bounced checks, stop payments, returned checks, balance inquiries, copies of monthly statements, and helping you balance your account.

Keeping a good banking record can be a hard job. Ask yourself these questions before you open a checking account:

• Do you know how to balance your checkbook?
• Would you have enough money to keep your minimum balance and cover monthly fees?
• Do you know how to write a check?
• How many checks do you write in a month?
• Do you know the banks' rules on fees and services?

Find out the answers before you open an account. Banks may help you with balancing your checkbook and writing a check. Also, you can learn about fees and services from banks' brochures.

If you have difficulty with English, you may want to bring a friend who speaks English with you. Banks may have staff who speak different languages. Don't you just walk away just because you can't understand English. You will find some help and banks will do their best to meet your needs.

Savings accounts often require lower minimum balances than checking accounts. If you write just a few checks each month, you may want to open a savings account and buy money orders instead.

A checking account can be a very good way to manage your money. But it takes time and effort to make it work. It is your choice whether to open a checking account or not. With this information you can prepare before you decide to open an account.

Prepared by Soo Jung Lee, Intern with the University of Illinois Consumer & Family Economics, W. Rogers Park Extension Center, Chicago, IL

Edited by Kathy Reuter, Consumer and Family Education, Countryside Extension Center.

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