Bank information

When you first arrive in the United States, you may not know what to do with your money or who to trust. Some refugees are afraid to use banks. You may feel nervous about giving your money to a stranger at a bank. You may have never used a bank before and wonder about how to open a bank account.

This page has bank information to help you understand about using banks in the United States.

It is important to understand basic bank information in the US like how to use an ATM., Photo by CG Hughes, CC.
It is important to understand basic bank information in the US, such as how to use an ATM.

Why you need a bank account

Keeping large amounts of money in your home or apartment or with you is not a good idea because it can get stolen or lost. It is better to store most of your money in a bank or credit union. Banks and credit unions in the United States are safe and secure, and millions of Americans use banks.

Once you start making money you should open a bank account. It makes it easier to receive money from your employer. It also makes it possible to pay for things through the mail or online.

Types of bank accounts

You can open a savings account or a checking account.

Checking accounts allow you to deposit money and pay your bills. Once you are working, you can receive your paycheck  as a direct deposit – this means it will go directly to your checking account from the employer.

If you have some savings, or want to start saving, you can open a separate bank account. Savings accounts help you save money for the future. You can earn interest by putting money in a savings account. However, most savings accounts only allow you to take money out of the account a few times per month.

Opening a bank account

To open a bank account, you will need at least a small amount of money. To open a bank account, you must show two forms of identification (ID) to prove who you are.

Checks and debit cards

After you open your savings or checking account, you may receive a debit card and checks.

A debit card is a plastic card you use to get cash out of an ATM machine (automated teller machine), a special machine that holds money. You can also use it to pay for things.  When you use your debit card, the money comes out of your bank account.

In order to protect your identity, you have to have a PIN (personal identification number) to use your card. You enter your PIN every time you take money out of the ATM or buy something. If you lose the card or it gets stolen, nobody can use it unless they know the PIN.

Sample Debit Card from the Wells Fargo "Hands on Banking" program.
Sample debit card from the Wells Fargo “Hands on Banking” program.

Checks are forms you fill in and sign to pay for things. The person receiving your check deposits it in their bank, and your bank pays them out of your account. You can use checks to pay bills, such as your rent and utilities. Local shops may also accept your checks if they know you.

Banking fees

Whether you choose a savings account or a checking account, ask whether you qualify for a free account. It is preferable to be able to deposit money (put money in the bank) and withdraw money (take money out of the bank) without being charged a fee. However, some banks require you keep a lot of money in the bank to qualify for a free account. A bank is a for-profit company owned by a few people who make their services available for a fee. You may get a more favorable account at a credit union which is a nonprofit owned by its members.

Bank employees can help answer your questions and help you understand how banks work.

Managing your bank balance

Once you have a bank account, you need to be careful to spend only as much money as you have in your bank. If you write a check but do not have enough money for the check, you will be charged an overdraft fee of $50 or more. If you make a mistake, you can explain to the the bank it was a genuine misunderstanding and politely ask the bank to refund the fee, and they may or may not refund it.

To avoid mistakes, you can check how much money you have in savings or checking account at the bank, online, or at an ATM. The amount you have is called your “bank balance.” Overdraft fees cost a lot of money, so it is wise to keep a very careful watch on your bank balance!

Sample Bank Statement from the Wells Fargo "Hands on Banking" program.
Sample Bank Statement from the Wells Fargo “Hands on Banking” program.
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