Checking accounts are a type of deposit account. They’re offered by banks, credit unions and other financial institutions. They typically come with checks and a debit card. These tools allow you to spend your money without cash.
By Joshua Rodriguez
- Traditional
- Interest-Bearing
- Rewards
- Student
- Second-Chance
- Checkless
- Business
If you’re in the market for a new checking account, you’ll find several different types to consider. Some offer perks like interest, while others are available for those with less-than-perfect checking account history.
7 Types of Checking Accounts To Consider
Find the details of some of the most popular types of checking accounts below.
1. Traditional Checking Account
Who should consider it: Those looking for simple, no-frills banking
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Traditional checking accounts are the original form of these accounts. They make it easy to access your money any time you need to make a purchase while ensuring that your cash is secure.
Most checking accounts offer a debit card to pay bills or make daily purchases. Even within traditional checking accounts, you’ll find a variety to choose from offered by different institutions. The best one for you depends on how you plan to use your account. For example, your financial institution may waive maintenance fees with direct deposits or a specific number of debit card transactions each month, or it might offer free checks or no-fee ATM transactions.
If you decide to open a traditional checking account, it’s important to compare the features of each option to determine which provides the services you plan to use.
2. Interest-Bearing Checking Account
Who should consider it: Those willing to navigate more complex terms in exchange for earning interest on their balance
Interest-bearing checking accounts are similar to traditional checking accounts in that they offer a safe place to deposit your money and provide access to checks and debit cards for daily purchases and financial needs.
However, there’s one key difference between the two. Interest-bearing checking accounts pay you interest or dividends. The amount they pay often depends on the amount of money you have in your account.
As with traditional checking accounts, there are several interest-bearing checking accounts to choose from. Each option has its own fee structure and other features. Take your time to compare your options before you open one.
3. Rewards Checking Account
Who should consider it: Those who want to earn rewards without credit card interest
Rewards checking accounts are what you would expect to see if a checking account and rewards credit card had a baby. These accounts offer a safe way to store your money. They typically come with checks and debit cards for daily spending needs. However, when you use them, you have the potential to earn rewards.
Each rewards checking account comes with its own rewards scheme and structure. Some cards may offer cash back, and others might offer travel rewards, gift cards or other perks to membership.
When you compare these options, look at all the traditional factors, like fees and features, that you would typically consider when comparing traditional checking accounts. Also, think about the reward scheme and features to determine which option is best for you — a travel rewards account won’t do you much good if you don’t travel.
4. Student Checking Accounts
Who should consider it: Students opening a first checking account
Student checking accounts are deposit accounts uniquely designed for people just starting their financial independence journey. They tend to come with the following student-focused features:
- Low Fees: Younger adults generally have less financial stability. These accounts tend to offer low or no fees. They may even come with perks that make it possible to waive overdraft fees and ATM fees.
- No Minimums: Most student checking accounts don’t require you to maintain a minimum balance.
- Age Restrictions: You must be between 14 and 25 to qualify for most student checking accounts.
- School Pride: You may be able to customize your card to show your school pride. Some even make it possible to attach your card to your student ID. When you do, you can use your student ID like a debit card on campus.
5. Second-Chance Checking Account
Who should consider it: Those who have a poor banking history and want to start rebuilding
Second-chance checking accounts work just like traditional checking accounts. The financial institutions that provide them either decide not to look at your ChexSystems report or look past it.
These accounts pose a higher risk to the financial institution, so they may come with higher fees than traditional checking accounts. However, they make it possible for those who have made mistakes in the past to access essential financial services.
Moreover, if you use a second-chance checking account properly, you can improve your ChexSystems report and will likely qualify for a traditional or another type of checking account in the future.
6. Checkless Checking Account
Who should consider it: Those who do not need paper checks
Checkless checking accounts are like traditional checking accounts. The difference is that they don’t come with checks. Instead, you’ll need to use your debit card for purchases and to access cash at ATMs.
These accounts usually don’t offer overdraft coverage. They also may help you limit your spending since there are fewer options to do so. They’re also a solid alternative to second-chance checking accounts because they’re usually easier to get than traditional options.
7. Business Checking Account
Who should consider it: Those who have or are starting a business
Business checking accounts are similar to traditional checking accounts, but there’s a twist: these accounts are deposit accounts that financial institutions use to serve businesses rather than consumers.
Business checking accounts may come with interest or no interest. They also all have their own terms, fee structures and potential ways to waive fees. Moreover, business checking accounts may have transaction limits. Compare your options. Maintain a focus on the features and terms important to you before signing up for one.
Final Take
If you’re in the market for a new checking account, consider the options above and how they might be the solution to your unique financial needs.
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What are the five types of checking accounts?
The five most common types of checking accounts are:
- Traditional checking accounts
- Interest-bearing checking accounts
- Second-chance checking accounts
- Student checking accounts
- Rewards checking accounts
What are the four types of bank accounts?
The four most common types of bank accounts include checking accounts, savings accounts, money market accounts and certificate of deposit accounts (CDs).
The five most common types of checking accounts are:
- Traditional checking accounts
- Interest-bearing checking accounts
- Second-chance checking accounts
- Student checking accounts
- Rewards checking accounts
The four most common types of bank accounts include checking accounts, savings accounts, money market accounts and certificate of deposit accounts (CDs).
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“Types of bank accounts.”
Patriot Federal Credit Union. 2022.
“What are the Benefits of an Interest-Bearing Checking Account?”
SoFi Learn. 2022.
“Is a Rewards Checking Account Right for Me?”
SoFi Learn. 2022.
“What Is a Student Checking Account and Do I Need One?”
Chase.
“What is second chance banking?”
Fortune. 2022.
“Checkless checking account: What it is and how it works.”
Square. 2021.
“The Basics of a Business Checking and Savings Account.”
