When you hear that banks offer free checking accounts, you can safely assume that these accounts do not charge fees to their customers. After all, a free account should not cost money. Do free accounts ever have fees, though? While every bank has different rules and procedures, most banks will only charge fees for free accounts for specific events. Here are several things to understand about this if you are looking for a free checking account.
A Free Account Has No Monthly Fee
First of all, when a bank offers free checking accounts, it means that they do not charge a monthly fee. When you open an account like this, you will never see a fee each month come out of your balance. The bank will not charge a fee. Some banks even pay interest for the money you have in your account, which means you might earn money from a free account instead of paying a service fee to have it. If a bank charges a monthly fee, the account is not free, and you should look for a different bank.
Free Accounts Might Have Rules
Some banks offer free accounts with stipulations. For example, they might not charge a monthly fee if you keep your balance over a specific amount. You might need to keep a $100 balance or more, but you will avoid the fee if you do not let your balance drop below this amount. Another stipulation some banks have is a limit on the number of transactions you can have with the account. For example, you might be allowed up to 10 transactions per month. If you have 11 or more, they might charge a fee.
Free Accounts Charge Fees for Other Things
While a free account should not have a monthly fee, you might pay other fees with your account. An example of this is an overdraft fee. Suppose you spend more money than the amount you have in the account. If this happens, your balance drops below zero. Almost every bank charges a fee when this occurs, and it is called an overdraft fee.
The other expense you might have is for ATM usage. If you get a debit card from the bank, you might have to pay fees to use it in some machines. Your bank will tell you which machines are free, so you should aim to use those.
If you need a checking account, look for a bank that offers free ones.
