August 29, 2022

Importance of Opening a Bank Account

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Are you thinking of opening a bank account? Wondering why is it crucial to open up a bank account for yourself? Well, in this article, I will explain the main importance of opening a bank account for yourself. Let’s dig into the importance of opening up a bank account. You can click here to learn more on online bank account registration malaysia.

  1. Bank account offers convenience for yourself
  • If you have a checking account, for example, you can easily pay by check or through online bill pay. It’s also less expensive than purchasing a money order (and you’ll have proof of payment in the form of bank statements). You can easily withdraw money or make payments at stores if you get an Automated Teller Machine (ATM) or debit card for the account. Debit cards are typically accepted wherever credit cards are accepted.
  1. Bank accounts are a safe option
  • Your funds will be safe from theft and fire. Furthermore, your funds will be federally insured, so if your bank or credit union fails, you will be reimbursed. The highest amount that can be insured is $100,000.
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  1. Bank accounts is an easy way to save money
  • When you deposit money in a savings account, many banks offer an interest rate. The interest will assist your money in growing over time. Make sure to shop around and understand the fees involved; you don’t want to end up paying more in fees than you gain in interest.
  • If you have a checking and savings account with the same financial institution, you can have your money transferred from checking to savings on a regular basis, putting money aside to help grow your savings.
  1. Bank accounts are cheaper
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  • Banks and credit unions typically provide their account holders with free or low-cost services such as:
  • Cashing checks: Using a check cashing service can quickly add up. You can deposit and cash checks for free at the institution where you have a bank account.
  • Paying bills: If you don’t have a bank account, you’re probably reliant on check cashing services, phone bill pay, or money orders, all of which charge fees. You can write checks for free or pay online at a low cost if you have a checking account.
  • Transferring/wiring money: If you use a money transfer company to wire money to another person’s account, you will be charged a fee, which is typically a percentage of the transfer amount. This fee can be expensive depending on the amount you want to transfer. When you wire money from your bank account to another person’s account, your bank will usually charge a flat rate that is lower than the money transfer company’s rate.
  • When you need cash but don’t have a bank account, you can use your credit card to get a cash advance from an ATM. You will be charged a transaction fee as well as interest by the credit card company. If you have a bank account and an ATM or debit card, you can withdraw money for free from your own bank’s ATM. Although you can withdraw money from any ATM, you will almost certainly be charged a transaction fee if you use an ATM other than your bank’s.