Benefits of a Bank Account
September 3, 2021
There are several benefits associated with having a bank account. We draw on articles from the Federal Deposit Insurance Corporation (FDIC), credit.org, joinbankon.org, and the American Bankers Association (ABA) to explore some of the benefits and to discuss the downsides of not having a bank account, banking options for the unbanked and underbanked, and why Americans trust banks most with their information in today’s climate.
The FDIC highlights 10 of the top reasons to have a bank account below. While there are many more credible reasons, these are some of the most obvious.
- Your money is safe
- Money is protected against error and fraud
- No check-cashing fees for checks made out to you
- Make online purchases with greater peace of mind
- Access to additional benefits from the bank
- Transfer money with ease
- Proof of payment
- Keep track of your finances
- Set useful alerts
- Pay bills from wherever you are
In addition to the several reasons to have a bank account, there are also many downsides to not having a bank account. Credit.org highlights a few of these reasons, including:
- Extra fees to access funds
- Lost time from lack of convenience
- Less safety and security
- Inability to accumulate interest
- Decreased ability to build credit
Simply put, most of these reasons add up to less money in your pocket.
A Bank On-certified account is one potential solution for those who have been unable to open a bank account in the past. According to Bank On, the average unbanked person spends 5% of net income on fees for alternative financial services. This results in individuals paying too much for basic financial transactions and hinders their ability to save. A Bank On account helps alleviate some of these issues, as they commonly have certain safeguards in place to ensure that you don’t overdraw your account.
Banks continue to earn the trust of consumers in comparison to other industries. According to a poll conducted by Morning Consult, Americans trust banks with their information more than any other industry. One reason is because consumers place the highest importance on FDIC insurance when determining where to deposit their funds. This trust appears to be strongest among the Gen Z population, as 57 percent of individuals in that age group expressed that they trust banks more than any other entity.