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With the emergence of Fintech (financial technology) and other exciting financial developments, it has become easier to open a bank account. For many, it might have been a few years since they had to open a new bank account. The good news is that the process is not as difficult as it once was.
Steps to opening a bank account
The process is very straightforward and should take less than an hour from start to finish as long as you have the right information. Depending on your preference, you can do this at a physical branch or online.
If opening an account at a branch, you can simply bring your information and request to speak to a banker, who will guide you through the process. If you open a bank account online, you will simply follow the signup process and upload the required documents when prompted.
What do I need to open a bank account?
Here’s what you’ll need:
- Valid government-issued photo ID such as a driver’s license or passport
- Standard information such as your birthdate, Social Security number Taxpayer Identification Number, or phone number
- Some banks require an initial deposit
- For joint accounts, you will also need their basic information and photo ID
How old do I have to be to open a bank account?
As it turns out, you are allowed to open a bank account at any age. However, there is one caveat. If you are under 18, you will need an adult to be a co-owner of the account. They will need to sign legal documents with the bank. Opening an account at a physical branch may be easier if you are a minor.
Types of bank accounts
There are four kinds of bank accounts you can get. Each one has a specific purpose and function.
When people use debit cards, it is usually attached to a checking account. Think of it as your “everyday” account. Money can be deposited, spent by check, and charged via debit card. The money held in this account is generally short-term money that will be spent in the near future. There are often monthly fees associated with a checking account, but many banks waive them if you keep a minimum balance.
Meant for the money you are trying to set aside and accumulate. The only difference is that you can’t write checks out of it. Banks incentivize you to keep your money here long-term with higher interest rates than you would get from a checking account. Be aware that some banks will charge you a fee for having a savings account.
Money Market Account
Like a savings account but with more features, including a generally higher interest rate paid, this hybrid between a savings account and a checking account. An account like this is best for people who can hold higher bank balances continually.
Certificate of Deposit
By depositing into a CD account, you agree to allow the bank to hold your funds for a certain period of time. The interest paid will be higher than other accounts, but the funds will not be accessible until after the allotted time. Withdrawing early will result in exorbitant fees.
What should I look for when choosing a bank?
There are several factors you should consider when choosing a bank. Before you sign up, keep an eye out for the following.
- Make sure the institution is secure and is FDIC or NCUA insured
- Be aware of any fees that are involved or that may kick in if certain conditions are not met
- Ease & convenience should be at the top of your list
- ATM locations and fees
- Interest rates being paid out
- Online banking and technology should be top-notch
- Make sure you can maintain minimum bank balances
- Great customer service & branch locations
Top 15 banks to open a checking or savings account
There are an unlimited number of banking options out there. Here are the top 15 banks that provide the perfect mix of security and cutting-edge services.
Bank of America
One of the largest banks in the world, opening a Bank of America checking account comes with security and cutting-edge convenience.
Many people don’t hesitate to recommend a Chase bank account with robust in-branch and online banking features. With an international footprint, it’s perfect for jet-set culture.
They aren’t just good at producing memorable commercials; these guys have invested heavily in their online banking technology and mobile app. Capital One banking accounts offer incredible benefits and provide very competitive interest rates.
While the minimum balance for their higher interest-paying accounts is in the tens of thousands, it’s a great option for higher net worth individuals. Its concierge-level service is a great benefit.
A fantastic mobile app and high-yield accounts make this a great option for tech-forward people. It’s considered one of the best banks for a checking account.
Not just for loans, these guys have some of the best banking features in the industry. To close an account with Lending Club is also very easy.
Their cash-back debit card is a great option for people who would rather get cash back than the little interest other banks offer.
Alliant Credit Union
Their high-rate checking account ranks at the top of most people’s lists.
An online-based fintech pioneer, SoFi offers a great free bank account option.
Their reward checking account is not one to be slept on. They offer a $100 account bonus with rewards checking.
Monifi Spend Balance
Given a 5-star rating by Nerd Wallet is no small accomplishment.
Connexus Credit Union
Their Xtraordinary Checking account charges zero fees requires no minimum deposit and provides over 1% in APY.
Not just for credit cards, AMEX is home to one of the best high-yield savings accounts in the industry.
Consumer’s Credit Union
One of the largest credit unions in the nation. It offers 2.09% APY with no minimum.
There is no shortage of options when opening a bank account. The key is finding one that matches your personal financial goals while charging as little fees as possible.