Banks, credit unions, or thrifts (also called "savings and loans") allow you to open accounts for managing money. Reasons people have an account include:
- Safety — Money deposited is safe from theft, loss, and fire.
- Security — Depending on the account, deposits are insured by the Federal Deposit Insurance Corporation (FDIC) for banks and thrifts, or the National Credit Union Administration (NCUA) for credit unions.
- Convenience — Depending on the account, you may have the ability to write checks, use a debit card, or bank electronically over the internet as a means to pay bills and make purchases.
- Cost — Using an account to write checks or withdraw cash will cost less than using a check cashing service.
- Financial Future — Using an account can help you develop the bill paying and/or savings record needed for building a credit history.
The following resources will help you choose an account that works for you and better understand banking options and regulations.
Insured or Not Insured: Bank Products (audio; 1:45) — Even if you see the FDIC sign or NCUA sign on a bank or credit union door, don't assume that all of the products they offer are insured. Transcript
Correcting Bank Account Errors (audio; 2:15) — The Fair Credit Billing Act and Electronic Fund Transfers Act establish procedures for resolving mistakes on credit account and bank account statements. Transcript
Other Recommended Resources
Dollar Works 2 — Teach others how to manage their personal finances and make sound decisions about money. This comprehensive curriculum has a unit on using a bank account.
Digital Dollars — Consumer Action — Information, advice, and training to help consumers navigate the new online economy. Resources in English, Spanish, Korean, Vietnamese, and Chinese.