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why do we need a bank account

Why Should I Have a Bank Account? Bank accounts are not just for those with a fortune to stash awayБanyone can open one. Essentially, the only requirement for opening an account is proof of identity (such as a driver's license, passport or state-issued ID card). Some banks accept other forms of identity for opening up an account, such as a voter registration card from a different country. If you're not already using a bank account to help manage your finances, there are some excellent reasons to take this financial step:
Safety : Stuffing your money under the mattress may be tempting, but in the event of a burglary or a fire you are not protected. It is far safer to keep your money in a bank account. Even if your bank is robbed, your bank account is insured, so you won't lose your money. Simplicity : Cash payments may work for you in some instances, but it is certainly not appropriate in all of them. Most standard bank accounts offer the use of a check or debit card in conjunction with the opening of a new account. By using a checkbook or debit card, you can conduct a variety of payments and purchases without having to carry loads of cash in your wallet. Most banks offer free or low-fee personal accounts. On the bank's website, look for an account labeled Бstudent,Б Бbudget checking,Б or something similar. Budget checking may limit your monthly transactions, but it should give you a basic checking account, ATM access, a checkbook and debit card, and (often) direct deposit.

Most banks these days also offer online account access, even with their free or very low cost account types. Having a bank account can be a great tool for managing your personal finances. Account statements can help you determine how and where you are spending your money and put you on track for a reasonable savings plan. Additionally, personal savings accounts often pay interest, which basically earns you free money. Interest paid means your money is working harder for you. To open up a standard bank account, visit some institutions in your neighborhood and compare fees, interest rates and other benefits before deciding which bank is right for you. Make sure to compare a national bank, a regional institution and a credit union, if you are eligible to become a member. Share your knowledge! Partagez vos connaissancesP! BY ADAM RHAITI WHAT IS A BANK ACCOUNT? A bank account is a financial account, which stores money on behalf of a customer. In general, the two most common types of bank accounts are transaction accounts and savings accounts. A transaction account (or checking account) allows the customer to freely and immediately access their money. This can be through cash withdrawals from an automated teller machine (ATM) or electronic funds transfer (EFT) through computers. As such, the transaction account is best suited for everyday use. In most cases, a customer will open a savings account alongside a transaction account.

Unlike the transaction account, a savings account allows the customer to earn interest on the account balance. In return, banks often do not allow frequent and immediate access to this money. As such, accountholders should always maintain a good balance of money between their accounts so that they have enough money to use immediately while also earning some interest. WHY SHOULD YOU HAVE A BANK ACCOUNT? While it is certainly possible to store your money in physical cash, there are many reasons why you should have a bank account. Security is an important reason why people store their money in bank accounts. Unfortunately, keeping physical cash at home is not safe since your home is exposed to the risk of burglary, natural disasters such as floods and accidents such as fires. It is similarly unwise to bury your money underground since moisture and air will likely decompose your money. When you deposit money into your bank account, the bank will store your money in their secured vaults. Also, if you need to transfer a large sum of money to a friend who also has a bank account, your bank can do it for you safely. Convenience is another major benefit of having a bank account. When you have a bank account, you are able to access physical cash wherever there is a bank branch or ATM. Alternatively, you can also pay for goods and services electronically through a debit card, which is linked to your bank account. Having a debit card also allows you to shop online, which gives you greater access to a variety of products from around the world.

Earning interest is another important reason to have a bank account. You may notice that each year, the price of many goods and services rises gradually. For example, a bag of apples costs $1 today; however, next year, the same bag of apples might cost $1. 02. This economic effect is referred to as inflation. As more money is required to purchase the same good or service due to inflation, the value of that same money falls. Having a savings account that earns interest protects you from inflation and the declining value of money. Finally, having a bank account allows you to better manage your saving and spending habits. Interest is also a source of income and encourages people to save regularly, which is a great habit to develop from an early age. Regular bank statements also display when and where money was spent, which can help people with planning and budgeting for the future. Clever management of saving and spending can ultimately help people reach their financial goals such as purchasing a house or car. While there are many benefits to having a bank account, it is just as important to protect your bank account from thieves. When purchasing goods and services online, ensure that the computer is protected by anti-virus software. If your debit card is ever lost or stolen, you should notify your bank immediately so that they can disable the card and send you a replacement.

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