A checking account is a deposit account which is held at a financial institution allowing deposits and withdrawals. Checking accounts are also called transactional accounts or demand accounts. They are very liquid and can be easily accessed through automated teller machines, checks and electronic debits along with the other methods. A checking account varies from other usual bank accounts specifically that it permits an account holder for numerous withdrawals. One will also find that checking account is beneficial for unlimited deposits; however, it must be noted that the savings accounts sometimes have limits on the deposits and withdrawals. Checking account is the easiest way that offers easy access to your money for the daily transactional needs and at the same time it helps in keeping your cash secured. As a customer, you can determine the most economical option that suits you by comparing the benefits and facilities offered by various checking packages with the services you necessarily need.
The effect of checking accounts over money supply measurements:
Since the money held in your checking account is much liquid, the nationwide aggregate balances are mostly used in the calculation of M1 (M1 is big money supply metric of a country, includes the physical money both paper and coin along with checking accounts, negotiable order of withdrawal accounts and demand deposits) money supply. M1 includes the sum of all monetary transaction deposits held at various depository institutions as well as the currency held by any individual. M2 is another measure that includes all the funds mentioned above which are accounted for in M1 and also the funds which are accounted in the schemes that come under small-denomination time deposits, savings accounts, and shares on retail money market mutual funds.
Using your checking account:
Checking accounts can be set up by the customers directly approaching the bank branches, or you can get an account simply through a financial institution’s website. For depositing funds, the account holders can use ATM facility or direct deposit and over the counter deposits. Accessing the funds are easy as using electronic debit or credit cards linked to the account or through written checks.
Majority of Americans own checking accounts even though some checking account information might seem obvious initially. While using the checking accounts here are some points that can help you to take advantage of many common features and checking account tips to help manage your money and benefit the most from your checking account. The easiest way to get the most out of checking account is set up a direct deposit. It’s fast and the safest way of depositing money into your account effortlessly.
By using your debit card, you can access your checking account and with great convenience and security and there is no hassle of cash or checks. Debit cards are accepted at millions of locations worldwide that include those outlets by which checks are not accepted similar to the online merchants. Debit cards can be used as ATMs for the deposits, transfers, and withdrawals between the accounts. With the debit cards, the purchases you make and withdrawals are all deducted directly from your checking account. Transactions using debit cards also offer security in case if your card is stolen or lost or if a fraudulent purchase occurs.
If you maintain both checking account and savings account at a single bank, it’s a fairly simple job to transfer money between the accounts. Your checking account can be linked to a savings account, but you don’t have to do that necessarily if you know that you have a specific amount of money in checking account at a specific date each month, it can be taken for your consideration to set up an automated transfer to your savings account. The automated transfer process can be a great way to building your savings.
Learning to manage the overdraft fees is an important thing to know when using your checking account. You might be aware of the fact that you are charged an overdraft fee every time you spent more money than the amount that you have in your account. To find an exemption from this fee, you have to keep an eye on your regular account balance, or you may set up alerts. Setting up alerts is reasonably easy once you are enrolled in online banking facility, it notifies you through the mail or via text messages regarding the updates and specific activity on your account. You can set up balance alerts as a precaution for when the funds in your account get below a certain amount. As a customer, you have to make sure that your bank has you’re up to date contact info like e-mail address and cell phone number. Many banks are offering optional overdraft protection that allows you to link a checking account which is eligible. Checking account can be linked to other eligible accounts to cover in case of an overdraft.