Finding the Right Bank
Choosing the right bank is an important step. As with any financial decision, itís good to sit down beforehand and figure out what you want and need. Do you want both chequing and savings accounts or just chequing? When preparing to open a chequing account consider:
- Location. Does the bank have branches in the areas of town you work, shop and play?
- Availability of ABMs. Automatic teller machines, or ABMs, allow you to get cash from your account night or day. The ABMs owned by your bank wonít charge you to withdraw cash, but other banksí ABMs will. Make sure your bank has machines in locations that are convenient for you, both your home and place of work.
- Hours. Do you work during the day? Perhaps you need a bank with extended hours. Some banks are even open on Sundays.
- Customer service. If friendly service is important to you, you might consider a smaller, locally owned bank, many of which offer more personal service as a way of competing with larger banks.
- Online Banking. The Internet has made it very convenient to keep track of your finances via online banking. Find out if the bank youíre considering allows online access to your account.
A service charge is the fee you pay to buy a service provided by the bank. Some chequing-account services are free, but many are paid for by customers on a user-pay basis. Most banks give you the option to save on fees with service plans or packages that offer different combinations of common services for a monthly fee. Looking into each of these offerings in some detail is a worthwhile exercise, as they vary widely from bank to bank.
Here are some common chequing-account fees:
- Monthly maintenance fees (these are often hinged on a minimum balance requirement)
- Withdrawal, account-transfer and bill-payment fees
- Point-of-sale debit transaction fees
- Per cheque fees
- Branch transaction fees
- ABM fees
- Online banking service fees
- Passbook recordkeeping fees
- Cheque return fees
- Overdraft charges (or overdraft protection charges)
- Stop-payment fees
- Certified cheque fees
- Money order fees
Interest Rate Earned
- Rate earned
- Minimum deposit requirement
- Compounding method
- Minimum balance
- Deposit insurance
- Holding period for deposited cheques
Other Features and Benefits
These days, banks are more than just places to keep your money. Many serve as one-stop financial service shops. Among the services and products banks can offer are:
- Credit Cards
- Lines of Credit
- Health Savings Accounts
- Financial Planning
- Investment Management
- Health, Home and Car Insurance
- Retirement Programs
- Direct deposit
- Automatic payments
- Overdraft protection
- Overdraft transfer service
- Pre-authorized transfer service
- Web Banking
- E-mail money transfers
- Telephone banking
- Availability in Canadian or US funds
- Other foreign currency
- Safety deposit boxes
- Travellers' cheques
- Discounts or free chequing for students, seniors or bank-sponsored credit-card holders
- Loyalty card "points" collection for transactions
Having all of these services in one place can provide not only convenience, but savings. Banks will often offer lower fees and higher interest to customers who use multiple services and products.
One possible downside, however, is that you might find greater expertise by working with companies that are more specialized, such as an investment firm or an insurance agency. Take the time to compare the banks' services with others before you decide.