Opening a bank account may be intimidating because it involves money. While others have their money in a bank account, some people still need to be ready to give their money for safekeeping, depositing, and other financial processes. If you plan on opening a bank account, you are at the right site! But first, you should know the basics.
What is a bank account?
A bank account is a record kept by a bank that details the deposits and withdrawals made on a client’s behalf over the period. At any particular time, individuals can utilize the bank account to check the historical record of cash on hand. A joint statement is a type of financial account that allows more than one person access.
What are the typical types of bank accounts?
1. Checking Account
A checking account is a financial institution where a person stores money to make purchases, pay bills, and withdraw cash. Since checking accounts are typically used for spending rather than saving, their interest rates are typically lower than those of other accounts.
2. Savings Account
A savings account is where you deposit the money you don’t need. Annual percentage yields (APYs) are the interest rate paid on a savings account each year, and they can change over time and depend on the account amount. It is helpful if you prefer saving to spending, as it forces you to think twice about how much you’re withdrawing from your savings account.
3. Money Market Account
A money market account combines the characteristics of a checking and savings account. Like a savings account, a money market account permits you to gain interest on your balance. Still, it also gives you the convenience of a checking account, with features like a debit card and the ability to write checks. It offers perks like better interest rates, the ability to write checks and use debit cards, and even insurance protection.
4. Certificate of Deposit (CD)
A CD is a savings instrument that allows you to deposit money for a specific period, typically between one and five years. Normally, bankers will incur a penalty if you withdraw CD funds before the end of the term. CDs are preferable for those who will only need access to their money after some time due to their lack of flexibility. No-penalty certificates of deposit (CDs) are available from CIT Bank CD rates in case you require access to your money before a conventional term CD matures or if you’re using a CD as an emergency fund. The CIT Bank No-Penalty CD could be the right choice if you’re looking for a high-interest rate and some leeway with your money.
What are the needed things to open a bank account?
In opening a bank account, you will need the following:
- A government-issued photo ID, like a driver’s license or passport. The DMV issues identification cards to people who do not drive.
- Your date of birth, Social Security number, Taxpayer Identification Number, and contact details (telephone, e-mail, etc.).
- Some financial institutions call for an opening deposit as a third requirement. Nonetheless, it will not be a significant sum of money.
There are a few more requirements you might do, depending on the situation:
- To have a joint account, you must have additional information from the other account holders: The bank will want identity and personal details from all account owners because owners will hold the account jointly. Be sure to enter all required data correctly.
- Suppose you’re under eighteen or still a minor, a co-owner. Bring in a parent or a guardian to sign some documents at the bank.