The process of opening a bank account is more or less straight forward, but the process of choosing and opening the right bank account can be a bit tricky. Meaning that the decision about the right bank account requires that you gather certain information. Failure to make decision based on the adequate information could mean higher cost for having and managing a bank account. Of course, this would be good for the bank because it will earn extra money from you on the basis of fees and charges.
Before deciding on the right bank account, make sure that you have considered the following issues:
Is there a minimum balance requirement?
Some require that you maintain a minimum balance on your account. You need to know what happens if you fail to maintain the required minimum balance, will you be hit with a fee. In addition, you should keep in mind that even though holding a minimum balance could waive some fees, these money cannot be used. When you use these money you will be charged a fee because you will no longer maintain the minimum balance required. Make sure that you can afford not to use the money deposited to satisfy the minimum balance requirement.
Interest rates paid on you balance
Aside of the charges imposed by the bank, you should also consider the interest rate paid by the bank on your balance. If you maintain certain balance each month why not earn some interest on it. Therefore, see if you can find a bank which will pay you certain interest on the money held with that bank.
Number of transactions per month
Some banks can you give you certain number of transactions per month. When you make more transaction then a fee may be applied and charged by the bank. Before deciding on the bank you would bank with, go through your past records and see how many transaction per month you have. In case you are making more transaction on a regular basis each month, then try to avoid bank account with limited number of free transactions.
Accounts with no monthly maintenance fees
There are numerous charges and fees we pay to our bank for having a bank account. These fees individually doesn’t seem to be a lot of money. In addition, if you look at these fees on a per month basis, they also seem to be a small amount. But the biggest mistake is that most of us look at them individually or as a per month charge. The problem with this perception is that we should considered the amount we are charged by the bank on a yearly basis. Then the numbers tell a different story. Individually they might be negligible but on a yearly basis they can turn out to rather high amount.
Therefore, when choosing the right bank and the right bank account for that matter, you should pay special attention the fees and charges imposed by the bank. Pay attention to fees for holding a bank account, overdraft fee, minimum balance fee, ATM fee, etc.
With some banks if you fulfill certain conditions you may be entitled to fee waiver. Make sure that you read the terms and conditions carefully. For instance, maintaining a minimum balance on your account can eliminate your monthly fee.
ATM fees and charges
When deciding about the right bank account you should also consider ATM fees and charged. Go through the charges and fees for withdrawing money at the ATM. Also consider the fees charged for using non-bank owned ATM, since bank may charge fees when you withdraw money from ATM which is not the banks’ ATM network. Additionally, you may want to consider the ATM network of the bank, keep in mind that local banks may have less developed network of branches and ATM’s’ when compared to big banks.
Offers and promotions for opening a bank account
Very often banks are provide certain rewards and have offers if you decide to open an account with them, or switch from your current bank. For instance, banks may offer cash or cash back opportunities, or elimination of certain fees. Carefully consider these offers because they could provide benefits in the long run and also reduce your cost of using certain bank products and services.
The decision to find the right bank account could be easier if you use comparison sites. You should use couple of comparison sites in order to collect most relevant information about terms and conditions of banks accounts offered by different sites. Another way to do it is to visit the website (or branch) of each bank and personally collect the information you need. Whatever method you use to choose the right bank account, make sure that you don’t open a bank account with the first bank you see. Open your bank account by paying attention to the aforementioned things. Remember, a small fee or low small charge each monthly could pile up on a yearly basis. This pile of money paid to the bank is actually your cost of owning a bank account.