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What You Need to Open a Bank Account

Financial Literacy two people talking over document

Opening a checking or savings account is very straightforward, but you’ll want to make sure that you have all the documents you need when you visit your local branch or apply online. Find out what you need to open a bank account below.

In addition to collecting the right paperwork, you’ll also need to make a few decisions:

  • Select a bank that meets your needs
  • Choose either a checking account or savings account (or both)
  • Determine how to fund your new account

After all of that, you’ll be ready to fill out an application, open your new account, and begin managing your money.

Documents You’ll Need to Open a Bank Account

To open a bank account, you’ll need three main documents:

  • Identification: All banks require at least one form of identification, and some require two, so check with your bank before applying. Acceptable forms of identification include a driver’s license, state identification card, birth certificate, or passport. 
  • Social Security number: Though you don’t necessarily need to bring the physical card along with you, you’ll need to know your Social Security number to open a bank account in most cases.
  • Proof of address: Make sure to bring along proof of your current address, like a utility bill or lease. 

chart showing documents and steps needed to open a bank account

In addition to having these documents, you’ll also need to be over 18 to open a bank account. That said, children ages 14–17 can open a joint account with a parent or guardian, which can be an excellent way to teach your kids about money.

Finding the Right Bank for Your Needs

Before heading out to open a bank account, it’s a good idea to figure out which bank will be the best fit for your needs. When choosing where to open an account, there are a few important considerations:

  • Should you use a credit union or a bank?
  • What sign-up bonuses are available for new customers?
  • Does the bank charge fees or require a minimum balance?
  • Would you benefit from an online bank?
  • Which apps and online services does the bank offer?

We’ve got more information about all of these decisions to help you find the best bank for you.

5 Questions to Ask Yourself When Opening a Bank AccountQuestionKeep In Mind

Should you sign up with a credit union or a bank? A bank has more branches and product offerings, but it may have lower interest rates and less personalized support.
A credit union has fewer branches and requires membership, but if you’re able to join, you may enjoy higher interest rates.
Are there any sign-up bonuses available? To decide between similar banks, opt for the one with a sign-up bonus if you meet the criteria. Bonuses usually range from $100 to $500.
Does the bank you’ve chosen charge any fees? It’s common for banks to charge fees for overdrafting, but some banks also charge if you don’t maintain a certain balance or use non-bank ATMs.
Would you benefit from an online bank? Online banks have no physical locations, so you’ll access them with an app or website, and they usually have higher interest rates.
Does the bank offer an easy-to-use app for your phone? A good bank app enables you to deposit checks remotely, move money between accounts easily, and view your transactions immediately. Make sure the bank you choose has the features you want.

Credit Unions and Banks 

There are a number of differences between banks and credit unions that may influence your decision about where to open an account. 

  • Banks are for-profit institutions that anyone can join. While they typically have the most diverse range of products and services available, they often have higher fees and interest rates, and they rarely offer a personal touch in customer service. Many banks have a national presence with branches all over the country.
  • Credit unions are nonprofit institutions that require membership. Joining a credit union involves meeting certain criteria, but the benefits include lower fees and partial ownership over the credit union. Credit unions are known for their personal attention and service, but they typically only have branches in a specific area.

Both banks and credit unions are insured, so your money is safe no matter which one you choose, so select the option that best fits your financial goals

Sign-Up Bonuses

Banks are always looking for new customers, and many offer sign-up bonuses to encourage people to join. These can vary from bank to bank, but typical bonuses range from $100 to $500 for new customers. 

Requirements to receive the bonus usually involve meeting a minimum balance or adding a direct deposit to the new account. 

If you’re going to be opening up a new account anyway, sign-up bonuses are an excellent way to choose between two similar banks. 

Fees and Minimums

Banks charge fees for a variety of reasons, including using non-bank ATMs or failing to meet a minimum account balance. You’ll want to choose a bank with the fewest fees possible. Additionally, once you have your account, you’ll want to avoid overdraft fees by keeping enough money in your account. 

Online Banks

These days, it is possible to get an account with an online bank that has no physical locations. Online banks have a number of advantages, like fewer fees and higher interest rates than traditional banks. That said, online banks can leave you without easy access if their website or apps go down for any reason. When applying for an account, note that it is often easier to open one online, but you may need an existing account to make an initial deposit. 

Technology

Before choosing a bank, you’ll want to determine which technology features are important to you. For instance, you may want a bank that has an easy-to-use app or mobile check deposit, or you may want to ensure your new account will sync properly with your budget tracking app

While smaller, local banks have the advantage of being nearby and easy to visit, they often lack the technology features of a larger institution. You’ll have to decide what makes the most sense for your needs. 

Choosing Between Checking and Savings Accounts

difference between checking and savings account chart

Before opening an account, you’ll need to decide if you want a checking account, a savings account, or both. Here are the main differences between checking and savings accounts:

  • Checking accounts: A checking account typically comes with a debit card that can be used for purchases or withdrawals from an ATM. These accounts usually have low interest rates, so they’re generally for money that you plan to use in the short term.
  • Savings accounts: A savings account is used for storing money that you don’t plan to use right away, and these accounts tend to have higher interest rates, which help your money grow. Savings accounts usually only let you make a certain number of withdrawals per month before paying a fee. Also, these accounts are some of the best places to keep an emergency fund

You aren’t limited to one account, though, and many people open both a checking and a savings account at their bank.

Funding Your Account

Once you’ve chosen a bank and collected your paperwork, you’ll need to seed your new account with an initial deposit. When funding your account, note that you may need to meet certain minimums to avoid fees or earn sign-up bonuses.

You can fund a new account in several ways:

  • Cash: If you’re opening at a local bank branch, you can use cash to fund your new account.
  • Check or money order: If you have an existing account elsewhere, you can use a check or money order to open an account at a local or online bank. 
  • Wire transfer: By providing your existing account details to your new bank, you can fund your new account with money from another account. 
  • Credit card: Only some banks accept credit cards for funding an account, and you’ll want to be careful that you aren’t charged a cash advance fee by your credit card company.

Once you’ve funded your new account, you’re all set up. As you continue to develop your personal finance skills, a great next step is learning how to open an investment account.

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