Bank Account Basics
Whether you’ve had a bank account since you earned your first paycheque or you’ve never had one at all, there are some basics that you’ll want to keep in mind. The points below will help get you get started, or give you a starting place if it’s time for a review.
Types of Accounts
There are a wide variety of accounts to choose from, depending on how you like to bank and what kind of services you need. Accounts typically include:
- Savings accounts
- Transactional or chequing accounts
- Full-service accounts with many types of transactions included
- Low-fee or no-fee accounts
- Youth, student and seniors’ accounts
How to Choose
So, with all those different types of accounts, how do you know which one is right for you? Different types of accounts have different service fees, so taking the time to get the best fit can really pay off.
First, think about how you plan to use your account. Maybe your banking needs are simple. You only make a handful of transactions each month and you rarely use ATMs or other services. On the other hand, your account might be very active — you use your debit card frequently, make a lot of transactions, and you need a number of other services to go with it. By knowing your own banking style, you can choose the right combination of products and services and pay only for the features you need and use.
Next, take a look at the big picture. Are you banking with multiple institutions, with accounts you opened at different times for different reasons? Or do you have a number of different accounts all with the same institution, but only use one or two regularly? You may be paying service fees on each account. Think about the reasons why you have each account and consider whether that’s still the right choice for you, or if the time and effort to consolidate might be worth the savings in the long run.
How You Like to Bank
Banking is more convenient than ever with services like online banking, telephone banking, and mobile banking. You’ll have access to your account any time you need it, day or night. If you haven’t tried any of these options yet, you might be surprised at how quick and easy it can be. Of course, visiting your branch is still a great way to get the most from your account. In-branch financial experts can offer you valuable advice that will help you set and reach your financial goals.
Use ATMs Wisely
Automated Teller Machines (ATMs) are a convenient way to access your accounts when you’re on the go. Just remember to be smart about which ones you choose. If you bank outside your own network, there may be additional service fees. Also consider how often you visit an ATM. Are you regularly stopping to grab small amounts of cash? This adds to your total number of transactions this month, so it may be worth it to take out larger amounts each time, but less often.
Using a credit card comes with convenience, security and even rewards, depending on the type of card you choose. When used wisely, they are a great addition to your financial mix. Just make sure to pay down your credit card monthly to avoid interest charges that pile up quickly. Can’t pay the full balance? At least pay the minimum. If you don’t, you risk hurting your credit score and you’ll also pay increased interest rates.
Snowbirds and U.S. Travellers
Spend a lot of time in the United States? A U.S. account will let you manage your funds without worrying about the fluctuating Canadian dollar. Purchase your funds when the exchange rate is good, then make your withdrawals when it’s time to go south.
Opening an Account
Anyone can open a bank account provided you have the proper identification. It’s important to understand that you can open a bank account even if:
- you don’t have a job.
- you don’t have money to put in the account right away.
- you have been bankrupt.