Bank Accounts 101

Almost everyone has a bank account. If you are thinking of opening one, or switching banks, it can pay to know your facts.

First of all, know that bank accounts are a good option for storing and managing your money. There will always be naysayers who don’t trust banks for whatever reason, but it’s just a fact that a bank is the safest place for your money to be. The FDIC insures up to $100,000 per depositor against loss. Additionally, opening an interest-bearing checking or savings account, or taking advantage of such investment options as CDs and money market accounts. An additional plus side to today’s banking is the advent of online bill pay (which most institutions offer), an option that offers convenience and security to consumers.

Of course, you have to spend money to make money, and banking is almost never free – despite what the advertisements may claim. Ultimately, you pay for the convenience and safety of a bank account in fees. Some accounts require a minimum balance, and some charge a monthly/yearly fee. CDs require you to leave your money alone for a period of time –usually anywhere from 3 months to a few years- under penalty of fees. And while interest-bearing bank accounts may be the securest way to invest your money, they are far from the most rewarding.

Getting the best deal on a bank account takes diligence and research. Fortunately, the Internet is a great source of information for comparison shopping, and most crucial information is just a few clicks away. It really pays to shop for the best bank account(s) for you, not unlike the way you’d shop for any other big-ticket item.  ■