Checking accounts come in handy for keeping track of regular spendings and deposits. Whether it’s transferring money to someone, making an online purchase, or receiving your paycheck, you can do all it conveniently with a checking account. Of all the types of bank accounts, a checking account provides the quickest and easiest access to your money.
Read on to know more about checking accounts, understand the differences between checking and savings accounts, and how to open a checking account.

What is a checking account?
It is a type of bank account that allows you to deposit and withdraw money for your daily use. This includes your getting your paycheck and making debit card transactions or direct deposits. This is one of the most liquid types of bank accounts and allows unlimited deposits and withdrawals, unlike savings accounts. That said, some banks may have a daily maximum limit on checking accounts.

The main purpose of a checking account is to keep your money secure and accessible for regular use. You can ask your employee to deposit your paycheck directly into your checking account, and you also have the option to move a portion of your money from your checking account to a savings account to earn more interest on your savings.

Since you earn low interest on the funds in a checking account, it is not wise to save money in this account for long periods. You can use a savings accounts for that.

What are the common checking account fees you must pay?
Just like many other financial products, certain fees are associated with a checking account. These include:

• Monthly service fee
  Several banks charge a monthly fee for maintaining a checking account, which can go up to $15. This fee may be waived if you can meet certain requirements, like setting up a monthly direct deposit of a specific amount or maintaining a minimum balance.
• Overdraft fee
  This fee will be charged if you spend more money than you have in your account. The fee can be as steep as $30, but it can be easily avoided by enrolling in an overdraft protection program. This program declines all transactions that are greater than your checking account balance, keeping you from having to pay this fee.

How is a checking account different from a savings account?
Checking and savings accounts serve different purposes. Here are some key differences:

• Access to a debit card
  A checking account comes with a debit card that you can use for making payments online and at stores and for ATM withdrawals. While you can transfer the money in your savings account to your checking account, many savings account don’t come with a debit card.
• Unlimited withdrawals with checking account
  With unlimited withdrawals, checking accounts provide flexibility and allow you to access your money anytime. On the other hand, savings accounts come with a cap on withdrawals, which is 6 times per month as per law.
• A checking account has low interest rates
  Since a checking account is made for short-term savings and transactions, you get an average interest rate of .04 percent. In contrast, you can earn a much higher interest on your money in a savings account.

What are the steps to open a checking account?
Opening a checking account is simple once you have selected a bank. You can either sign up online or visit your local branch. You will need to provide your personal information like name, address, date of birth, and social security number.
Your bank might run a credit check, but it is a soft inquiry that doesn’t hurt your credit score. Depending on the bank, you may have to deposit a specific amount, ranging from $1 to $50, to open your account.