Are you aware that there are 17 million people in the United States without a bank account? The reasons vary, but interestingly, many millennials believe there’s no need for a bank. Despite the growing mistrust in financial establishments, a checking account is crucial for daily money management. Here are five compelling reasons to have one:
1. CHECKING ACCOUNT AS EVIDENCE OF PAYMENT
Checks serve as written documentation of your payments. Every time you issue a check, several records of it are created, and having this proof is crucial for tax purposes and when mailing payments. These records can be found in your bank statement, checkbook, duplicate check copies, and in online banking platforms where you can print check images. Given the risk of fraud or duplicative charges, it’s beneficial to have easy access to these records.
2. GREATER SECURITY WITH CHECKS
For the older generation, checks offer a safer alternative to cash when shopping by mail, as checks leave a paper trail, discouraging theft. If you prefer to gift cash during special occasions, a check is a more secure choice. Plus, checks are less costly than money orders or cashier’s checks.
3. STREAMLINED BILL PAYMENTS AND RECEIVABLES
With most checking accounts offering free bill pay, you can easily manage and pay all your bills online, reducing physical paperwork. You can also pay individuals via most banks. Person-to-person (P2P) payments simplify things like splitting rent. Additionally, a checking account comes with a debit card that helps you track your expenses. Lastly, direct deposit allows for seamless payday transactions, eliminating the need to physically cash or deposit your check.
4. BENEFITS OF ONLINE BANKING
Imagine stashing all your cash in a bag instead of utilizing traditional bank features. That would be chaotic! For most people, balancing a checkbook is archaic. Platforms like Mint.com or Personal Capital allow them to manage their finances. With a checking account, you can conveniently oversee your resources online, a simpler approach than handling actual cash.
5. UNLIMITED TRANSACTIONS
Checking accounts eliminate federal restrictions on monthly electronic transfers unlike savings accounts that limit transactions to six per month. This could be constraining if you consider your spending habits! It’s wiser to have both a checking and savings account for seamless transfers. It’s an effective saving method, far better than hoarding cash haphazardly.
The bottom line is, a bank account is vital for easy and quick money management. Online-only banks typically outrank conventional banks in convenience and fee affordability.
