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Checking accounts are a banking starting point for many people. Whether you’re paying your bills, receiving a paycheck, or want to keep better tabs on spending, a checking account can serve as your financial hub.

A checking account offers several options and benefits, depending on your financial goals. Some accounts have fees or specific requirements, while other checking accounts are specific to a customer’s needs such as a business owner.

Find out how each type of checking account works, along with the pros and cons of a checking account.

Choosing the best type of checking account

When managing your money, selecting the right type of checking account is important. Each type caters to different needs and preferences, offering unique benefits. Here’s a breakdown of the various checking account types:

Traditional checking accounts

Traditional checking accounts offer the basic functions you’d expect – like check writing and ATM withdrawals – without many of the bells and whistles of other account types. These accounts are offered at banks and credit unions. They come with a debit card and either free checks or the ability to purchase a checkbook.

Sometimes, traditional checking accounts offer online bill payment services and physical branches if they are not offered through an online bank. However, some traditional checking accounts may also have overdraft fees and monthly maintenance fees.

Premium checking accounts

Premium checking accounts are similar to traditional ones but offer additional perks like higher interest rates, free checks, and waived fees. These accounts typically require a higher minimum balance or monthly fee compared to traditional ones.¹

Joint checking accounts

A joint checking account is shared by two or more people, usually for bills, household expenses, or shared financial goals. It’s a common option for married couples and domestic partners.

Opening a joint checking account means all parties have equal access and can make deposits, withdrawals, and payments. Trust and open communication with the other person sharing your joint account is key.

Business checking accounts

Designed for entrepreneurs and small business owners, business checking accounts offer business-specific features, such as the ability to accept payment processing and manage a high volume of transactions.² Some business bank accounts allow 200 transactions per month before charging a transaction fee while others don’t limit the number of fee-free transactions per month.³

With a business bank account, you can separate personal and business finances to track expenses, manage cash flow, and simplify tax preparation. Business owners can also get debit or credit cards linked to the account for easy purchasing and expense tracking.

Digital checking accounts

Digital or online checking accounts provide the convenience of online and mobile banking without needing physical branches. They often have lower fees, but may lack in-person services. For example, instead of going to your bank and speaking with a teller or ordering more checks, you will need to call the customer service number on the back of your card or request a service from your bank online or through their app.

Digital checking accounts are a popular choice for those who prefer to manage their money on the go and don’t need in-person services. You will still have a debit card, can receive direct deposit, and can withdraw funds from your local ATM. Many online banks have a network of fee-free ATMs, so you can save money on your withdrawals at certain ATM locations in your area.

Kid and teen checking accounts

Also known as minor accounts, kid and teen checking accounts are a great way to introduce financial responsibility to young family members. They typically come with spending limits and parental controls. Some also offer savings options to help children learn the importance of saving money.

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8 benefits of a checking account

A checking account is more than just a place to store your money. It’s a financial tool that helps you track your finances so you can work toward your goals. Here are some notable advantages of a checking account:

  • Access your income in advance: With direct deposit, you can sometimes receive your paycheck earlier than the traditional payday. Having immediate access to your funds can help you pay bills on time and avoid late fees. It can also help you avoid waiting until you return to work to receive your check if you’re sick or on vacation during payday.
  • Earn interest on your money: Some checking accounts offer interest, allowing your balance to grow over time. You may also want to consider opening a high-yield savings account or money market account to earn more interest on your money.⁴
  • Ensure the security of your funds: Checking accounts are generally FDIC-insured for banks or NCUA-insured for credit unions for up to $250,000, protecting your balance up to that limit in the event of bank failure or issues.
  • Easily retrieve your money: You can conveniently access all your money in one place and cash using ATM withdrawals, checks, and online transfers.
  • Handle your finances from your phone: Many modern checking accounts offer comprehensive mobile apps for banking on the go.
  • Open an account with a minimal initial deposit:You can open many accounts with a low or no minimum deposit.
  • Educate children about financial management: Kid and teen checking accounts are excellent tools for teaching the basics of money management, from budgeting and keeping track of their spending to understanding banking fees.
  • Effortless money transfers: Send and receive money easily with electronic transfers and mobile payment apps that can be used with your checking account.

3 cons of a checking account to consider

While checking accounts offer many advantages, there are some potential drawbacks to be aware of.

  • Fees: Some accounts may charge monthly maintenance, ATM, or overdraft fees. These fees can add up over time, especially if they cannot be waived. Instead, look for checking account options that don’t charge many fees.
  • No interest earnings: Traditional checking accounts typically don’t earn interest, unlike some savings accounts.
  • Required minimum balance: Certain accounts might require you to maintain a minimum balance to avoid fees. This can tie up your money and lead to unnecessary costs if not carefully monitored.

By familiarizing yourself with these benefits and drawbacks, you can make an informed decision about whether a checking account aligns with your financial needs and goals.

Open a checking account and take control of your finances

Checking accounts can be a convenient and accessible option for managing your finances. There are many benefits of a checking account like tracking your spending, receiving paychecks via direct deposit, and enabling parental controls for kid and teen accounts. However, there may be fees associated with these accounts, and they may require a minimum balance.

To further optimize your financial health, explore how much money you should keep in your checking account.


What is the purpose of a checking account?

A checking account is used for everyday transactions and managing your finances. It allows easy access to your money through debit cards, checks, and online transfers.

Why is it so important to have a checking account?

A checking account can provide a secure and convenient way to manage your finances, access your income, and make payments or purchases. It also offers the opportunity to teach financial literacy skills to children and teens. It’s important to be aware of potential fees and drawbacks associated with these accounts so you can make informed decisions about your financial management.

Can I earn interest on a checking account?

Some checking accounts offer interest rates on balances, but they are generally lower compared to savings accounts or other investment options.

Chime® is a financial technology company, not a bank. Banking services are provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC. The Chime Visa® Debit Card and the Chime Credit Builder Visa® Credit Card are issued by The Bancorp Bank, N.A. or Stride Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa debit and credit cards are accepted. Please see the back of your Card for its issuing bank.

While Chime doesn’t issue personal checkbooks to write checks, Chime Checkbook gives you the freedom to send checks to anyone, anytime, from anywhere. See your issuing bank’s Deposit Account Agreement for full Chime Checkbook details.

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‡ SpotMe® for Credit Builder is an optional, no interest/no fee overdraft line of credit tied to the Secured Deposit Account. SpotMe on Debit is an optional, no fee service attached to your Chime Checking Account (individually or collectively, “SpotMe”). Eligibility for SpotMe requires $200 or more in qualifying direct deposits to your Chime Checking Account each month.

Opinions, advice, services, or other information or content expressed or contributed here by customers, users, or others, are those of the respective author(s) or contributor(s) and do not necessarily state or reflect those of The Bancorp Bank, N.A. and Stride Bank, N.A. (“Banks”). Banks are not responsible for the accuracy of any content provided by author(s) or contributor(s).

* Out-of-network ATM withdrawal and over the counter advance fees may apply.

¹ Information from Investopedia's 'Is a Premium Checking Account Worth It?' as of April 16, 2024:

² Information from SBA's 'Open a Business Bank Account' as of April 10, 2024:

³ Information from's 'Everything You Need to Know About Business Checking Account Fees' as of April 22, 2024:

⁴ Information from FDIC's 'National Rate and Rate Caps' as of April 10, 2024:

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