6 Questions Students Should Ask About Checking Accounts

My Money August 02, 2016

Opening your first checking account is a rite of passage for students. You’re going to take control of your money whether it’s because you’ve landed your first job or wanted to be able to spend some of that graduation money without carrying around a bunch of cash. A checking account is a secure and convenient way to access your money and can also help you practice good spending habits.

However, in a world full of ads, perks and features, how can you be sure you’re getting the best checking product for your needs? As a student and a consumer, it’s important to understand all of your options (and read the fine print) before you choose a checking account.

Below are 6 questions you should consider before opening a student checking account.

1.  What, if any, are the fees?
While most banks charge monthly maintenance fees for checking accounts, many also offer accounts specifically designed for students. These student accounts may have low, or even no, monthly fees. Others may require a minimum balance or direct deposit in order waive maintenance fees. Additional fees may also apply if you use other services such as money orders or cashier’s checks.

2.  Is there a minimum deposit to open the account or minimum balance to maintain it?

Yes, it’s true, you may need to save up some money to open the account. The amount required, if any, will differ from bank to bank. After you open your account, you may also be required to maintain a minimum account balance. Going below your minimum balance can result in fees, so be sure to find out what those would be. It’s a good habit to check your account balance often in order to avoid any additional fees.

3.  How can you access your money?

Be sure you understand all the ways you can access your funds, and if the options the bank offers fit your needs. For example, find out where the bank’s branches and ATMs are located. Is it a convenient walk, bike or drive? If not, do they have online banking available so you can access and review your accounts whenever you like? Also, if you are a smartphone user, some banks offer a mobile banking app that lets you complete banking tasks (payments, transfers, etc.) on the go.2

4.  Are there limits or fees associated with accessing your money?

Most banks impose a daily withdrawal and/or separate ATM withdrawal limit in order to protect your account. In addition, withdrawals made from an ATM not affiliated with your bank may incur fees, so be sure you know what those fees are. You can often avoid them by planning ahead and researching where to find ATMs associated with your bank. Most banks have an ATM locator online or on their mobile banking app to make that task easy and convenient.

5.  Are there ways to avoid overdrafts and overdraft fees?

Overdrafts—spending more than is in your account—can incur very expensive fees and you should make every effort to avoid them. Your first line of defense is to regularly check your balance and recent transactions so that you are aware of your available funds. Most banks offer convenient online and mobile features to help you do just that. For example, you may be able to set up text alerts to let you know when your account has reached a balance that you define. Banks may also offer you the ability to transfer money from a savings account to your checking account in the event of an overdraft. Some banks may even offer a line of credit that you can borrow against to cover an overdraft. However, these services themselves may involve additional fees and/or interest rates that can really add up. So it’s best to practice sound financial planning and avoid overdrafts entirely.

6.  Will my bank grow with me?

You won’t be a student forever. Make sure that the bank you’re considering offers products and services that you’re likely to need in the future, including savings accounts, credit cards, vehicle loans and mortgages. Also, see if the bank offers educational and personal resources to help you grow financially. For example, see if they have helpful online resources, offer phone support and have conveniently located branches.

Opening your first checking account means you’re taking responsibility for your finances. Do some research and know what you’re getting before you sign up.

Visit usbank.com for more information on student checking accounts.

1. The U.S. Bank Student Checking account was named a “Best Teen and College Student Checking” account. From Money Magazine, November 2013. ©2013 Time Inc. Money is a registered trademark of Time Inc. and is used under license. Money and Time Inc. are not affiliated with and do not endorse products or services of U.S. Bank. 2. Your mobile carrier may charge access fees depending upon your individual plan. Check with your carrier for specific fees and charges. Deposit products offered by U.S. Bank National Association. Member FDIC.