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What is a Checking Account?

March 10, 2021  

According to the Federal Reserve, nearly 8 in 10 Americans over the age of 18 have opened a checking account at some point in their life. Checking accounts hold a vital role in our society, but do we know what a checking account is? In this blog, we will discuss what is a checking account, the difference between a checking account and a savings account, and a comparison of checking accounts at Neighborhood Credit Union.   

What is a Checking Account? 

A checking account is a type of deposit account individuals open at a financial institution, whether it is a bank or credit union, that allows the owner to quickly withdraw and deposit money using a debit card, electronic transfers, or checks.
Checking accounts are also known as spending accounts, deposit accounts, bank accounts, and funds, to name a few. 

It has become a standard part of modern society and even more so with the recent COVID-19 pandemic, as several businesses move towards cashless transactions. The main purpose of a checking account is to provide safe and quick access to your day-to-day funds without having to carry around large amounts of cash. 

Checking accounts are one of the most fluid types of accounts. They are perfect for depositing any paper checks or cash you have received, withdrawing cash, or setting up direct deposit for access to your income right away. Owning a checking account may also be required if you prefer to electronically pay bills or transfer money to a friend, but they are not ideal to utilize for long-term saving goals, such as saving for retirement or a house.   

The Difference Between Checking and Saving Accounts

No matter your lifestyle, checking and savings accounts can be extremely useful. Checking accounts are great for day-to-day use with quick access to your funds, while a savings account is a perfect place to set aside money with a goal of not spending.   

Checking Accounts Savings Accounts
Created for daily use.  
Created for short or long-term saving goals. 
Use debit cards to pull funds directly from your account.  
Have a limited amount of times you can withdraw funds.  
Perfect for paying bills.  
Offers higher interest.  
No withdraw fees.  
Limited amount of withdrawals per month.    
You can explore savings accounts at Neighborhood Credit Union here

Checking Accounts At Neighborhood Credit Union

At Neighborhood Credit Union, we want you to find the checking account that best fits you and your needs. We offer a variety of checking accounts each with their own benefits. Take our short quiz to find your perfect account. 

Kasasa Cash Checking 

Free checking with High-Yield Interest. Members can earn 1.05% APY interest on up to $50,000 account balance and ATM withdrawal fee refunds¹
 
Kasasa® Cash Account Benefits

Kasasa Cash Back Checking

Free checking with cash back. Earn 3% cash back on purchases for a maximum of $9 each month and ATM withdrawal fee refunds²
 
Kasasa Cash Back Benefits
 
How to Qualify for Rewards for Kasasa Accounts 
Kasasa Cash Back Account : Complete the following requirements each Qualification Cycle† to qualify for 3% cash back on up to $300 in purchases for a total of $9 per month and ATM withdrawal fee refunds of up to $20²: 
Kasasa Cash Checking: Complete the following requirements each Qualification Cycle to qualify for 1.25% APY interest and ATM withdrawal fee refunds of up to $201:
  • Fifteen (15) individual or combined debit or credit card transactions of $5.00 or more post or settle
  • AND one automatic ACH payment or direct deposit post and settle
  • AND go paperless! Sign up to receive eStatements and decline paper statements 

Priority Checking

With Priority Checking members will enjoy cash back rewards and overdraft fee forgiveness. 
Priority Checking Account Details
  • $11.99 per month with fee-reduction options to reduce or eliminate your monthly fee4
  • No minimum balance required
  • Overdraft Fee Forgiveness5 gives members up to $40 in fee refunds annually upon request. Life happens, and we’re here to help with the unexpected. 
  • Get Cash Back Rewards will provide you with the opportunity to activate special offers in Online Banking and the MyNCU Mobile App, and earn cash at select retailers when you use your Neighborhood CU debit card.
  • No-Surcharge Network gives you the comfort of avoiding ATM surcharge fees with 32,000 nationwide ATMs within the MoneyPass Network. 
  • Opening deposit minimum: $25
How to Reduce Your Monthly Fee with Priority Checking 
Complete the following requirements to earn credit up to $11.99 per month:
  • Enroll in eStatements and opt-out of paper statements: $1 credit per month 
  • Signature-based debit card purchase that posts and settles within cycle: $0.20 credit each

Fresh Start Checking 

Our second chance checking account that is ideal for those with less-than-perfect banking history. 
Fresh Start Checking Account Details 
Perfect for those who have had closures at other financial institutions, problems with ChexSystems, or have been denied checking account due to banking history.
To be eligible to convert your Fresh Start Checking to another Neighborhood Credit Union checking account, you must have six months of satisfactory account history and complete the online CheckRight educational workshop course.

The CheckRight Workshop 
An online, self-study program that allows you to learn at your own pace and test your knowledge on checking accounts. After passing the quiz (score of 16 out of 20), contact us to assist you in converting your checking account. Visit the CheckRight(Opens in a new Window) page to learn more or begin the quiz.
 

How to Open a Checking Account 

To open a checking account at Neighborhood Credit Union is easy. So easy in fact, that you can submit your application in just a few steps. Once you are at myncu.com you will see an “Open an Account” icon. Click on that icon select what you would like to open and do the following:  
  • Fill out the form with your first name, last name, email, and phone number. 
  • You will then be asked to provide your zip code to make sure you are in an area Neighborhood Credit Union serves.   
  • Then select what products you would like to open.  
  • Once products are selected, we will ask for your personal information, social security number, driver license number, etc.  
  • Finally, we ask that you confirm your information and then submit your application.  
After you have submitted your application, a Neighborhood Credit Union Online Account Office will review your information, and make sure nothing was missed, they will then contact you within 1 (one) business day.  

Conclusion

Whether you call it a spending account, deposit account, or bank, a checking account is an essential tool for financial wellness and is something most of us depend on for our day-to-day transactions. Picking a checking account can be overwhelming. Once you know what to look for in finding a checking account that fits your needs, you can use the rewards to your advantage. 


†Qualification Cycle = a period beginning one day prior to the first day of the Monthly Statement Cycle through one day prior to the close of the Monthly Statement Cycle. Transactions may take one or more banking days from the date the transaction was made to post to and settle account.

1APY = Annual Percentage Yield. Kasasa Cash qualifications that must be met to obtain the 1.25% APY and ATM Withdrawal Fee refunds include: 1. Fifteen (15) individual or combined debit card or credit card transactions of at least $5.00 or more each (transactions may take more than one day to post/settle to your account); AND 2. Have at least one (1) automatic ACH payment or direct deposit post and settle; AND 3. Sign up and agree to receive eStatements and decline paper statements. ATM transactions or transfers between accounts not valid for qualifying. Qualifying transactions must post to and settle account during monthly qualification cycle (Qualification cycle = one day before beginning of statement cycle through one day before end of statement cycle. Statement cycle = first day of month through last day of month.) If qualifications are met each monthly qualification cycle: (a) Domestic ATM withdrawal fees incurred during qualification cycle will be reimbursed up to an aggregate of $20 and credited to account on the last day of monthly statement cycle; (b) balances up to $50,000 receive APY of 1.25%; and (c) balances over $50,000 earn 0.10% APY on portion of balance over $50,000, resulting in 1.25% to 0.55% APY depending on the balance. If qualifications are not met, all balances earn 0.01% APY. Minimum to open is $100. Fees may reduce earnings (see fee schedule). Limit one account per household.

2Kasasa Cash Back qualifications that must be met to obtain cash back rewards and ATM Withdrawal Fee refunds include: 1. Fifteen (15) individual or combined debit card or credit card transactions of at least $5.00 or more each (transactions may take more than one day to post/settle to your account); AND 2. Have at least one (1) automatic ACH payment or direct deposit post and settle; AND 3. Sign up and agree to receive eStatements and decline paper statements. ATM transactions or transfers between accounts not valid for qualifying. Qualifying transactions must post to and settle account during monthly qualification cycle (Qualification cycle = one day before beginning of statement cycle through one day before end of statement cycle. Statement cycle = first day of month through last day of month.) If qualifications are met each monthly qualification cycle: (a) Domestic ATM withdrawal fees incurred during qualification cycle will be reimbursed up to an aggregate of $20 and credited to account on the last day of monthly statement cycle; and (b) you will receive 3% cash back on purchases up to $300 for a total of $9 per month on combined debit and credit card purchases. If qualifications are not met, no cash back payments are made and ATM withdrawal fees are not refunded. Minimum to open is $25. Fees may reduce earnings (see fee schedule). Limit one account per household. Please visit myncu.com/kasasa-cash-back to see the Fee Schedule and full Kasasa Cash disclosures.

4Restrictions apply. Priority Checking begins with a $11.99 base service charge monthly fee that can be reduced or eliminated. The fee is reduced by $1.00 each Monthly Qualification Cycle for receiving electronic statements. The fee is reduced by $.20 each time you use your debit card to make a signature-based purchase during the Monthly Qualification Cycle (purchase must be $5 or more; ATM and PIN based transactions are excluded). Qualification Cycle and Statement Cycle = the first day of the month through the last day of the month. Transactions may take one or more banking days from the date the transaction was made to post to and settle account. See the Fee Schedule here. **Overdraft Fee Forgiveness applies only to fees charged for overdraft and Courtesy Pay and is granted upon request on an annual basis. Relationship Fee refunds received during the calendar year will count toward the annual limit of $40. See the Rates & Fees page here.

5Overdraft Fee Forgiveness applies only to fees charged for overdraft and Courtesy Pay and is granted upon request on an annual basis. Relationship Fee Refunds received in a calendar year will count toward the annual limit of $40.

6Direct Deposit is required for Fresh Start Courtesy Pay. Courtesy Pay is available to qualified members after 60 days and overdraft fees apply. Please view the Courtesy Pay Guide (Opens in a new Window)here. See Rates & Fees page.(Opens in a new Window)

7Courtesy Pay is available to qualified members after 60 days and overdraft fees apply. Please view the Courtesy Pay Guide(Opens in a new Window) here.

View the Truth-In-Savings Disclosure(Opens in a new Window).

 
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Skyler has been a Marketing Content Specialist at Neighborhood Credit Union since 2019. 

Who We Are 

As an active part of the community for 91 years, Neighborhood Credit Union is a not-for-profit financial organization serving the state of Texas with branch locations in Collin, Dallas, Denton, and Ellis counties, as well as the city of Arlington. With assets topping $1 billion, Neighborhood Credit Union has a continuously growing membership of 56,000. For more information, call (214) 748-9393 or visit our homepage

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