How to set up a checking account

March 16, 2022 |4 min read

If you’re ready to open a checking account, you may already have some financial needs in mind—like setting up direct deposit, paying bills or getting a debit card.

Virtually any checking account will provide these basic services. But if you want to find an account that really fits your needs and budget, there are a few other factors worth considering. Here’s a simple, 5-step guide to walk you through the process:

1. Gather your identification documents

What’s required to open a checking account is probably right at your fingertips. If you open it in person, you’ll likely need two forms of ID (such as a driver’s license, Social Security card, passport or birth certificate) and proof of address (by way of a utility bill, mortgage statement, lease or similar document).1

But if you’re like most people, you may be wondering “Can I open a checking account online?” The answer is yes. You’ll simply enter information such as your date of birth and ID numbers on the bank’s application page. If you’re applying for a joint account, you will likely both need to verify your identities. Under 18? Banks may allow you to get a checking account if a parent or legal guardian is willing to be co-owner of the account.

Those are the basic requirements for most people to open a checking account. If you don’t drive, you can get an ID card from your local DMV. If you’re not a U.S. citizen, you may just need an Individual Taxpayer Identification Number and proof of your identity to open a checking account.2

Now that you know what to bring or have on hand to open a checking account, it’s time to learn about fees or—better yet—how to avoid them.

2. Explore low- or no-fee accounts

Some banks charge monthly service fees, maintenance fees, low-balance fees and ATM fees. If you’d rather avoid these charges (who wouldn’t?), be sure to go with a truly “fee-free” checking account so there are no surprises.

Some banks charge their checking account holders $12 a month (or more) if they don’t maintain a balance of $1,500 or satisfy other requirements.3 That’s $144 a year! By shopping around, you can steer clear of these fees and most additional costs.

Some banks require a minimum deposit, usually between $25 and $100, when opening a new account.1 Again, if this doesn’t suit your needs, no problem. There are checking accounts that require nothing at all to get started.

3. Find features that fit your lifestyle

Everyone’s banking needs are a little different, so think about your lifestyle and what you need your checking account to handle. Need to pay bills online? Do you travel and need ATMs in lots of locations? Maybe you want to deposit paychecks with your phone on the go. All totally doable. Just keep a list of “must-haves” handy as you compare banks.

Overdraft protection is another option to think about. Say you lose track of your balance and spend more than you have in your checking account. Lots of people have been there a time or two (or three), which can result in a penalty. Luckily, there are checking accounts that come with a range of overdraft protection options that can keep those fees at bay.

4. Earn a little interest

Besides avoiding fees, you could actually make a little money just for keeping your cash in a checking account that earns interest for you.

Even if your balance will be fairly low, it’s worth choosing a checking account that pays interest because every dollar counts. And remember, cash hidden under a mattress or in dresser drawers will never have the chance to grow.

5. Bank on the go

Today, checking accounts can be as mobile as you are, with apps that can sign you in with the swipe of a finger (rather than a password), send you instant alerts or transfer money quickly and securely.

Once you open your checking account, you can fully explore its features. Just be sure to review any confirmation materials you receive and follow the instructions for setting up your debit card, using your bank’s online services and keeping your account safe.

There’s no doubt about it: Opening a bank account is faster and easier than ever. But ensuring that it’s affordable and really fits your needs is what matters in the long run. So, shop around and find a checking account that has the features you’re after. You’ll be glad you did.

Opening a checking account — also called a “share draft” account at credit unions — is easier than you might expect. Perhaps the hardest part of the process is determining which type of checking account is suitable for your needs, and we already have you covered there with our quick reference guide and online comparison tool. You can complete your account application online or, if you’d prefer, you can visit a local branch of the bank or credit union you have chosen.

In this guide, you will learn the steps of opening a checking account, what the general requirements are and how to select the right type of account and financial institution.

Before You Apply

In order to ensure you’re applying for the right checking account, you’re going to need to put in a bit of work before you actually start filling out an application form.

1. Identify Your Needs: The right checking account corresponds to your individual needs and usage habits. So, before applying, ask yourself the following questions:
   • Do you want a checking account primarily to deposit your earnings, pay bills electronically, write checks, transfer money, make everyday purchases, or all of the above?
   • Will you need access to a physical bank branch or ATM network near your home, work, or school? Or, could you get by doing most of your banking online and over the phone? Do you want to have access to your own banks’ branches and ATMs when traveling?
   • How much money do you plan to keep in your account?
   • Which matters more: an accessible bank or minimal fees?
   • How important is it that your account balance earn interest?
   • Do you qualify for any special accounts, such as those designed for students, seniors, or members of the military?
2. Compare Financial Institutions and the Types of Checking Accounts They Offer: Check out WalletHub’s online comparison tool find the best account for your own banking needs. Each financial institution’s website will also have details on the checking accounts they offer.

   As you review your options, don’t overlook credit unions and online banks. Credit unions are member-owned non-profits that serve people who share an affiliation (e.g., those who work for certain employers, or residents of a city or neighborhood). Online institutions, such as Ally Bank and Discover Bank, have few if any brick-and-mortar branches, so you may not have the option of banking in person. In return, you’ll generally get lower feels and higher interest yields on interest-bearing accounts.

   Here’s a quick list of some of the fees and features you may want to compare across accounts to find the financial institution that offers the most relevant services for you at the lowest cost:

1. Determine Who Will Have Access to the Account: If you share personal finances with someone, you might also consider opening a joint checking account that you both can access. In your application, you would simply choose the option for joint checking (if available) and provide information for each co-owner.

Opening a Checking Account: A Step-By-Step Guide

Most banks and credit unions give you a choice between setting up an account online or visiting a nearby branch to open your account the old-fashioned way. Whichever you choose, opening an account follows the same general steps:

1. Gather Your Application Materials: Before you can complete an application, you’ll need the following three things:
   • Identification: When opening an account in person, most banks require two forms of identification such as a Social Security card, driver’s license, state ID, passport or birth certificate. If you are not a U.S. citizen, you may be able to open an account with identification issued from your home country. To apply online, you’ll need to supply your Social Security number, date of birth and the number of a government-issued ID like a driver’s license. If you’re applying for a joint account, both accountholders will need to provide identification.
   • Proof of Address: To open an account in person, bring a lease or utility bill with your name and current address.
   • Opening Deposit: Typically, a minimum opening deposit for a basic checking account is between $25 and $100, although it may higher for interest-bearing accounts. If you open your account online, you can pay with a credit card, debit card or an electronic transfer from a savings or checking account at another institution.
2. Complete an Application: Simply go to the application page on the institution’s website or visit a branch location.Afterward, the institution will review your information. Typically, the bank will run a special credit check that provides information on your past banking history to determine whether to approve your account. If approved, you should receive documents that bear your new account number and routing number as well as other important account information.
3. Sign a Signature Card/Account Documents: This is the card to which your signature will be matched every time you write or deposit a check. With many online-only institutions, you’ll be able to sign your paperwork electronically but some may require you to visit a physical branch to sign the signature card or to mail or fax documents.
4. Make Your Opening Deposit: Depending on how you make this payment, there may be a hold of a few days before your funds are available for writing checks, making withdrawals or making debit card purchases.
5. Receive Your Account Tools: Once your application is finalized, your deposit is made and your account set up by the bank or credit union, you will receive in the mail a set of personalized checks, deposit slips and, in most case, either a debit card or an ATM card. You will need to activate your debit/ATM card and set up online account access.
6. Set Up Direct Deposit: Arranging to have payroll or government check directly deposited to your account is often required to avoid monthly fees or to get other benefits. If you have chosen an account that requires direct deposit or simply want to take advantage of this convenience, you’ll need to talk to the payroll department at your employer, for example, to get the direct deposits started.

Image: JJ Studio/Shutterstock

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