What Do You Need to Open a Bank Account?

A bank account can be an important part of modern life, allowing you to save money easily and make payments through a checking account or even online.

If you’ve ever wondered, “what do I need to open a bank account,” we’re here to answer that question and help you get yourself prepared.

what do i need to open a bank account
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What do you need to open a bank account?

Bank requirements for documentation can vary. Some requirements stem from federal laws while others are based on bank policy or on the type of bank account you want to open.

  • Valid government-issued ID with photo. In most cases, people use their driver’s license as an acceptable photo ID. However, if you don’t have a driver’s license, a valid passport can be used instead. If you don’t have a driver’s license or a passport, reach out to your bank to ask what type of photo identification is required. Federal rules allow banks to accept alternate forms of ID.
  • Name, address, birth date, and occupation. As part of your bank account application, you’ll need to supply your name, address, and birthdate. Additionally, expect to provide information on your occupation. If you’re a student or retired, simply indicate this as your status on your application.
  • Social Security Number (SSN). You don’t need a social security number to open a bank account. However, for most people, a social security number offers the easiest way to provide the bank with a government-issued ID number. If you don’t have a social security number, banks and credit unions can accept some alternate forms of ID.
  • Taxpayer Identification Number (TIN). One common alternative to a Social Security number is a Taxpayer Identification Number (TIN). If you’re not a US citizen or you aren’t a permanent US resident, you can get a TIN by completing form W-7 with the IRS.
  • Co-owner. People under the age of 18 can’t open a bank account exclusively in their name. If you’ll be owning opening a joint account or a custodial account for a minor, the bank will require identification and other information from a parent or guardian.
  • Identification and signatures for all the account holders. If you’re opening a joint account with someone else, you’ll need identification and signatures from all the account holders. If you’re opening your bank account in person, it’s best that all bank account holders go with you because the bank may need to witness signatures or verify identification.
  • Phone number. There are countless reasons why your bank might need to reach you and in many cases, you’ll be glad your bank had a way to reach out to you. However, many safety experts recommend that you call your bank back if they call you. This is to avoid scams in which someone pretends to be a representative of the bank.
  • Email address. Most banks will ask for your email address. In some cases, you can also save money by signing up for electronic delivery of bank statements. Not only will you save a tree, but you might save a few dollars per month as well.
  • Initial deposit. Not all bank accounts require an initial deposit. In some cases, you can open an account and then add funds later. However, most times, people open an account by providing an initial deposit. Be sure to find out how much money you’ll need if your bank requires a minimum amount.

What types of bank accounts are you looking to open?

Unless you’re opening a bank account for a business, a trust, or another type of separate entity, the types of information you’ll need to open an account should be similar.

However, for certain types of accounts, you may need additional items, such as account numbers for other bank accounts or a specific minimum deposit amount.

Checking accounts

A checking account allows easy access to your funds through withdrawals, transfers, or by writing checks.

Some banks and credit unions require a minimum deposit or a minimum balance for checking accounts.

In some other cases, keeping a minimum balance offers a way to avoid account maintenance fees.

Savings accounts

With savings accounts, you’ll find more restrictions on transfers.

However, you’ll gain the opportunity to earn interest on your deposits. Additionally, keeping some money separate from your checking account can be an effective way to control spending.

Money market accounts (MMDA)

If you choose a money market deposit account, you can often earn a higher interest rate than with a standard savings account.

As a trade off, money market accounts typically require a minimum balance or minimum deposit.

Interest rates are usually tied to the amount of money you keep in your money market account, with higher account balances earning higher interest rates.

Certificates of deposit accounts (CDs)

Similar to money market accounts, certificates of deposit typically pay higher interest rates than a standard savings account.

However, if you choose to open a CD, you’re committing to leave your money on deposit for a fixed amount of time, usually ranging from 3 months up to 5 years.

Online-only banking accounts

Many times, online banks usually don’t have brick-and-mortar locations, accounts are less expensive and you can also earn a better interest rate by choosing an online-only bank account.

Expect the entire process, including any support services you may need, to happen online or through fax, phone, and email.

Features to consider when opening a new bank account

Opening a bank account is usually a fairly easy process but you want to pay careful attention to the details. If you don’t meet the account requirements you can trigger additional fees or may not get the best rates.

  • Minimum opening deposit. These days, many banks and credit unions offer bank accounts with no minimum initial deposit or just a nominal amount, such as a dollar or even a penny. However, some banks or special accounts do require a minimum opening deposit. Be aware of the amount required and how your account might be affected depending on how much you deposit.
  • Minimum balance. Many bank accounts also require a minimum balance, which can mean that a fee may apply if your balance falls below the minimum required amount. Most often, minimum balances are tied to monthly maintenance fees, meaning that if your balance falls below the minimum your account may be charged a fee for that month. With some types of accounts, the amount you keep on deposit can affect your interest rate as well.
  • Direct deposit. Many banks offer a promotion or bonus if you have a direct deposit to your account within a specified time after opening your account. In some cases the bonus amount can be large — including amounts of over $100 — but may also be limited to certain types of accounts.
  • Interest rates. The amount of interest you earn on your bank account can be a consideration as well. Even in today’s low interest rate environment, you can find a wide range of rates available. If you expect to keep a lot of money in your bank account, it’s often worthwhile to choose a higher interest account.
  • Electronic banking options. Consider the types of electronic banking options available for your account. For example, while many accounts offer a Visa or MasterCard branded debit card, some type of accounts may only offer a money access card (MAC) or equivalent. Think about what you’ll need access to your money and whether the type of card provided will be accepted.
  • Number of transactions. Federal regulations limit the number of transactions you can make on some types of accounts. However, your bank may also add additional restrictions that can affect access to your money. Be sure the type of account you choose provides the access you’ll need.
  • Writing checks. Check writing privileges are included with a checking account but money market accounts can also offer check writing privileges. This flexibility to write checks as needed while also earning a higher interest rate can be an attractive option.
  • Overdraft protection. If your account offers overdraft protection, it means that the bank will honor checks up to a certain amount even if your bank account has insufficient funds to cover the check. Expect to pay fees in many cases if you do have an overdraft. However, mistakes can happen to anyone when balancing checkbook and overdraft protection can be a useful feature.
  • Bonuses and benefits. The days of banks giving out free toasters are probably long gone. Instead, expect most new account bonuses to come in the form of cash credited to your account. In some cases, you can also get extra discounts for trips, services, or even merchandise.
  • Deposits are insured. Bank accounts are insured through the FDIC for up to $250,000 per individual per bank. Joint accounts are covered up to $500,000 per bank. Nearly all credit union deposit accounts are insured through the NCUA, which follows the same pattern of up to $250,000 for individuals and $500,000 for joint accounts. However, some credit unions choose a different method of insurance.

Fees to look out for when opening a bank account

  • Monthly service charges or maintenance fee. These days, it isn’t hard to find a bank with monthly fees of $5 or less. With a bit of searching, you can also find accounts with no monthly service charge or maintenance fee. However, be aware that some banks charge as much as $15 or more as a maintenance fee.
  • Low minimum balance fee. If your balance falls below the minimum required amount, some accounts can be subject to a minimum balance fee or trigger a maintenance fee for the month.
  • Debit and ATM card fee. Some accounts charge a fee for using your debit card or atm card. Fees can vary depending on where your card is used or how often you use your card.
  • Overdraft fee. Overdraft protection can be a lifesaver but fees for overdrafts are common. Expect to pay about $35 with most banks if you do have an overdraft.
  • Nonsufficient funds fee. If a check is presented against your account but your account doesn’t have sufficient funds to cover the check, you can also be charged a fee for non-sufficient funds. On average, expect to pay up to $35 for a nonsufficient funds fee.
  • Excessive transaction fee. Savings accounts have federal limitations on transfers, which currently limits the amount of transfers or electronic transactions to 6 per month. If you exceed this transaction limit, expect to pay a fee. Your bank or credit union may also convert the savings account to a checking account so that the account remains in compliance with federal rules.
  • Early withdrawal fee. If you open a CD, you’re committing to keep your money on deposit for a certain amount of time. If you withdraw from the CD prior to the CD’s maturity date, expect to pay an early withdrawal fee.
  • Printed check fee. Checks aren’t always free with a checking account. Many banks charge for printed checks. However, you can also get checks through third-party sources, and often for less than the bank charges.
  • Balance inquiry fee. A balance inquiry fee can apply if you check your bank balance through the ATM at a bank other than your own. Consider checking your balance online instead.
  • Online banking fee. Various fees for online services can apply, such as ordering copies of check images or requesting copies of old statements.

Where to open a bank account

Regular banks

Convenience has value and with over 5,300 locations Wells Fargo can make a great choice if you’re looking for a big bank with a large retail presence.

Community banks

If you prefer a smaller bank, you can find a community bank through the Independent Community Bankers of America (ICBA). Just search by zip code to find several local options.

Credit unions

Navy Federal Credit Union is the largest credit union in the country. However, credit unions tend to be regional. You can find a credit union that serves your area through MyCreditUnion.gov.

Some financial institutions screen potential customers

When you apply for a bank account, most banks run a special type of credit report that targets your banking activity specifically.

However, depending on the type of account and the policies for that bank, some banks may also run a credit check that examines your payment history.

  • Credit checks: When a bank run a credit check, it can appear as a hard inquiry on your credit report. A hard inquiry is a request for credit and could affect your credit score. If your bank account offers overdraft protection, in effect, the bank is granting you credit if needed.
  • ChexSystems: Banks also run a special type a report that examines your banking history, including overdrafts, outstanding balances with other banks, and other items that may be of concern or can affect your eligibility for an account.

Common Q&A about bank accounts

What do I need to open a bank account for my child?

Policies can vary by bank, but documentation you may need include your child’s Social Security number and your child’s birth certificate.

Your bank may also require some information from you, including your driver’s license, your Social Security number, and proof of your address.

What do I need to open a bank account for an LLC?

To open a bank account for an LLC, you’ll often need several documents, which may include your LLC’s Articles of Organization, your business license, your LLC’s Operating Agreement, and Employer Identification Number (EIN).

You may also need a Resolution to Open a Bank Account signed by officers of the LLC.

How long does it take to open a bank account in person?

Expect to spend about a half hour working with a representative to open your bank account.

To reduce the amount of time you have to wait for a representative, consider going to the bank between 10 and 11 AM Monday through Thursday when many banks are less busy.

Many online banks promise a process that takes only minutes.

Can I open a bank account online?

Yes, you can open a bank account online. In fact, some banks do most or all of their business online.

Many larger brick-and-mortar banks also offer the ability to open a bank account online.

For example, Wells Fargo which has over 5,000 locations, also offers ways to open an account online.

Can I open a bank account if I owe another bank money?

If you owe money to a bank due to an overdraft, unpaid fees, or for another reason, it can be difficult to get a standard bank account while that balance remains unpaid.

However, some credit unions and banks offer second chance checking accounts. Most states only have a few financial institutions that offer these types of accounts.

Can I open a bank account with no deposit?

A number of banks now offer no-deposit accounts. Be sure to check on fees or special rates that may apply based on the balance in your account.

Can I open a bank account with bad credit?

In most cases, you can open a bank account even with less-than-perfect credit.

Banks often check your financial history but may look at different types of information than a lender.

For the purpose of opening a bank account, a late payment on a credit card may be less relevant than an unpaid balance with a previous bank or credit union.

Can I open a business bank account without an SSN?

You don’t always need a Social Security number to open a bank account.

Banks and credit unions can also accept an Individual Taxpayer Identification Number (ITIN). In some cases, other types of ID numbers can be used, such as a passport number.

What if I can’t open a bank account?

If you can’t open a bank account due to negative items on your banking history, consider clearing up any outstanding bank balances or opening a second chance bank account.

You can also look for a bank that doesn’t use ChexSystems.

While most banks use bank history reporting, some do not. Alternatively, consider using money orders while you work to qualify for a standard bank account.

Can a foreigner open a bank account in the US?

Federal rules govern who can have a bank account in the US. If you aren’t able to get a Social Security number, you can file form W-7 to apply for an Individual Taxpayer Identification Number (ITIN). 

Bottom line

Opening a bank account is usually an easy process but it’s helpful to have your paperwork together before you try to open an account.

Just as importantly, give some thought to why you need the account and which features you’ll need. Fees and interest rates can also be a consideration.

By investing some time before you open your account, you’ll be able to make a better decision and choose the bank account that best fits your needs.

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