After careful deliberation of the chosen bank, the next step is to choose whether you will be opening a savings account or checking account.
Both of them have their own pros and cons and you must be familiar with them first before finally arriving to your final decision.
If you need your money to generally be moving such as paying bills or for everyday needs, checking accounts will work best for you.
Checking accounts come with a checkbook you can carry around and issue checks when needed. Issued checks will automatically be charged against your bank balance. Mostly this comes with a debit card you can use with an ATM machine for withdrawal purposes.
However, your checking account may not earn interest and if by chance they did, it is much lower than your regular savings account. Also, there are fees that come with checking accounts such as: maintenance, cancelled checks, stop payments, and ATM fees among others.
Savings account is for short term savings need. It yields higher rate than checking accounts but lower than bonds and CDs. Savings account is perfect for you if you don’t need the money right now but not yet ready to commit your funds for a long time.
If you consider your saved money as an emergency fund that you might need to withdraw anytime without inconveniences of a penalty, savings account is good. On the other hand, with savings account, you need to go to the bank when withdrawing funds. Your account doesn’t come with much but a passbook.
Although some banks offers a combination of both checking and savings account, it is best to talk to bank officers to know your options better since it varies from one bank to another.
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