A checking account is a bank account you can use for everyday spending. These accounts typically have lower interest rates than savings accounts, but you get immediate access to your funds. This makes them very useful for cash withdrawals at ATM machines or debit card spending. Online banking now allows you to view the balance instantly, but it can sometimes take time for merchants to process payments.

Some checking accounts offer overdraft protection. This protects your account in the event that you spend more than you have available. Types of checking accounts include:

• Traditional checking accounts
• Senior checking accounts
• Interest-bearing checking accounts
• Rewards checking accounts

Let’s discuss the perks of each in more detail:

1. Traditional checking accounts
Traditional accounts typically do not have any monthly fees, but some banks require a minimum balance. You’ll either need to make a certain number of deposits or keep a certain amount of money in the account to ensure it remains active. You’ll typically get a free debit card when you open one of these accounts. Many banks offer online bill pay services and direct deposit options. If you select direct deposit, then your weekly paycheck will be automatically deposited into your checking account. You usually get unlimited check writing with these accounts as well.

2. Senior checking accounts
Senior accounts are typically offered to people 55 and older. The bank will usually waive the account maintenance fees, so it’s free to keep the account open without holding money in it. There are typically no overdraft fees, and some banks offer free checks. Deposits in these checking accounts may gain a small amount of interest over time. Some banks offer free money orders and discounted safe deposit boxes. These are definitely preferable if you are over the age of 55 because these accounts are essentially traditional accounts with extra benefits.

3. Interest-bearing checking accounts
Interest-bearing accounts pay you interest to keep the money in the account for some time. These are often preferable to interest-bearing saving accounts because you’ll have instant access to your money. Savings accounts pay more in interest, but it takes longer to withdraw the funds. You can instantly deposit money into an interest-bearing account, so you’ll be able to start gaining interest as soon as the money is deposited. It can take time to move the money from checking to savings, so this is ideal if you want to gain a little bit of extra interest on money you plan on spending in the near future.

4. Rewards checking accounts
Rewards accounts offer high interest yields, airline miles and cash back bonuses. Some of these accounts will reimburse you for ATM fees. These are ideal for people who use their debit cards regularly. You’ll want to ensure you’re able to meet the minimum requirements. The rewards are similar to ones offered by credit card companies. The bank pays you additional benefits for using their services. These reward systems vary. Some have tiered structures, and most have minimum requirements. You may need to make a minimum number of debit card transactions each month to keep the card active. Some banks also offer sign-up bonuses. The bank will essentially give you free money if you open an account and meet some minimum requirements. You may need to hold a certain minimum balance or set up direct deposit.