Open a personal checking account with a check

firemanA checking account is an essential component of good personal financial health. It's used to deposit a salary or other earnings and make regular payments for housing, food, gas, utilities, and other household expenses. Opening the account requires a brief application, with a personal or third-party check used for the initial deposit.

In recent years, checking accounts have become more versatile to serve the new ways people work, make purchases, and handle their money. ATM cards linked to checking accounts allow account holders to access their money easily without visiting a bank. Online portals and mobile apps provide a way to check balances, track outgoing payments, and transfer funds to other accounts held by the same bank.

A checking account also links to other useful banking services, such as mortgages, car loans, money market savings accounts, and credit cards. Additionally, with direct deposit and online deposits available, customers can carry out many transactions without actually handling physical checks.

Why you should open a new checking account

There are several reasons for opening a new checking account. You may be changing banks or moving from a large, national bank to a more local community bank or credit union.

You may be interested in a new account dedicated to regular loan or mortgage payments. By funding this dedicated bank account with a monthly or weekly salary and having loan payments debited directly from the account, you'll put this debt on convenient "automatic pilot."

Whatever your reason, opening a new checking account is a relatively simple operation. At a minimum, though, banks will ask for identification. Then, an initial deposit can be made with a personal or third-party check.

Will your deposit be immediately available?

Note that funds you deposit may not be immediately available to withdraw. It's common for banks to put a hold on larger sums that are deposited with a check, although most will quickly honor a check written against those funds.

Ask the banker about the bank's "available funds" policy and what kind of holds you can expect on deposits made with personal or third-party checks. Cash and money orders should not be subject to any kind of hold or pending status. Certified or bank checks, as well as direct deposits, should also be immediately available.

What you need to open a checking account

Before opening the account, the bank will ask for proof of your identity. In most cases, the bank will accept a passport, driver's license, or identity card issued by your state. The bank also needs your Social Security number.

The bank may ask for a second document to verify your current address. Your name and address usually appear on a lease, mortgage bill, utility bill, phone bill, or some other kind of business invoice, such as a property tax form or a paystub from your employer.

The bank will verify your information and run a background check to ensure your previous bank accounts were closed in good standing.

What to expect when you open your new checking account

The bank will have new account forms for you to complete and sign. The documents will ask for a Social Security number, current address, contact phone number, and employment status. The bank may ask for an individual taxpayer identification number for a business account.

If two people hold the account, the joint account holder will also have to provide this information.

Making the initial deposit with a check

Once the forms are completed, your banker will ask for an initial deposit. You can use a personal or business check or a paycheck from your employer. Any third-party check must be endorsed by signing the back of the check. This authorizes the bank to deposit the money under your name.

Cash or money order will also work for the initial deposit. The banker will fill out a deposit slip, make the deposit at the counter, and return a receipt for the funds.

Depositing money at the account opening is frequently optional. You can open some accounts without an initial deposit, although a minimum amount is required for perks such as interest or a new-account bonus for certain accounts.

Features of your new checking account

Banks favor direct deposits, which are payments to account-holders sent by an electronic transfer. Many workers, whether they have an employer or are self-employed, are now compensated this way. Direct deposit saves employees the time and hassle of depositing a physical check and saves an employer the hassle of creating, printing, and signing important physical documents that may go astray.

For the bank, direct deposits also mean less employee time spent on accepting deposits and handling checks, cash, and deposit slips. It's a more efficient way to operate and reduces waiting time for customers at the bank. For these reasons, the bank may reward a direct deposit setup with some kind of bonus money or a higher interest rate paid to the account.

Other perks can be offered for minimum balance requirements. An account may waive overdraft fees, for example, if the account holder keeps a minimum of $500. Regular service fees for the account may also drop if the account has direct deposit or meets a minimum balance.

Questions to ask before opening a checking account

Not all checking accounts are the same. Some are appropriate for busy people who make a lot of payments and deposits. Others are best used for higher balances that need to be held in reserve for big purchases.

Before heading out to the bank, ask yourself a few questions.

Do you need a business account, personal account, joint account, or student account?
What is your monthly spending budget, including utilities, rent, and incidentals?
How often will you need to write checks on the account?
Do you need/want a personal or business credit card?
Do you plan on keeping a high balance? If so, does the bank offer different interest rates when you keep a minimum balance in the account?

It's also wise to ask what kind of fees the bank charges. What does the bank charge for overdrafts? Is there a monthly maintenance fee if the balance drops below a certain amount?

"Free checking" accounts avoid fees, and overdraft protection will cover any checks with a short-term loan or a transfer from a linked account.

Can you open a checking account online?

Online banking has changed the money landscape for personal and business checking customers. Account holders do their work over the internet. Opening the account online may take a bit longer, however.

For an online checking account, you still must provide identification and a Social Security number. The bank can verify the number from a driver's license or identification card but may require you to email a scanned copy or fax the documents. The bank may also ask for a signature card so that your signature can be matched and verified.

Have a physical check to deposit for the account opening? This is where the convenience factor kicks in. Using tech known in the banking industry as remote deposit capture, you photograph the front and back of the check and then upload it to the bank's mobile platform. The photograph will be scanned for routing and account numbers, as well as the amount.

Note: The check must still be signed.

If there's any issue with accuracy, the online platform will ask you to resubmit. If your photograph can't transmit the check information accurately, you will have to submit the physical check either in person at a bank branch or by mail. The bank may also accept images submitted by email or fax.

Can you open a mobile checking account?

Opening a mobile account is similar to that used for online banking. You simply need to choose the bank and the type of account you want, fill out an application via your phone screen and provide proof of your identity.

A physical check can be used for an initial mobile banking deposit using your phone's camera. You simply need to sign or endorse the check and photograph the document's front and back sides. You'll enter the amount of the check on a deposit screen, then upload the photos using a Submit button.

Keep physical records, checks, and statements from any financial institution in a safe place, though. Well-organized financial records will be a big help at tax time or when you are applying for a loan or mortgage. Dedicate a banker's box and file folders to this task.

Further rewards with Kasasa accounts

Kasasa partners with credit unions and community banks, allowing these institutions to offer rewards and competitive checking products where you live.

Checking accounts offered by Kasasa reward account holders. One may offer a higher-than-average interest rate, while another gives refunds and cash back for online purchases. Kasasa also refunds the fees charged by “out of network” ATMs.

These are truly free checking accounts, with no monthly fees and no minimum balance required for the high interest rates paid.

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