On the surface, chequing accounts are merely a place to hold funds to conduct your daily banking transactions. However, with multiple offerings and fees, determining how to get the best use out of your chequing account can be difficult.
Chequing account uses
Some typical uses of a chequing account include using it as a place to have your paycheque deposited, pay for purchases, credit card bills, and other services. Some accounts now allow you to conduct online purchases.
Aside from using your chequing account for debit purchases, you can also use it to transfer funds to your friends, family, or to another one of your accounts. One of the most common ways to transfer money is through Interac e-Transfers, which may be free with certain accounts. If you’re transferring between accounts held in your name at the same institution, these transfers are often free. Use a chequing account comparison tool to see what account has the features you want.
Multiple chequing accounts
Given one chequing account lets you conduct all sorts of banking transactions (such as debit transfers, bill payments, and money transfers), you may be wondering if it makes sense to have more than one account. Multiple chequing accounts may be of use to you if you’re interested in having different accounts for your various expenses.
For example, you can have your main chequing account for everyday spending and one for bill payments. This may seem redundant as you can pay all these expenses with one account, but it may be of interest to you if you’re following a strict budget. Having multiple accounts can help you easily track your expenses and allocate the required funds as needed. Depending on the chequing account provider, additional accounts may be free or included in your monthly fee. Make sure to compare multiple chequing accounts to ensure your banking needs are satisfied for the lowest monthly cost.
Joint chequing accounts
Joint chequing accounts are one of the best ways to manage shared expenses or day-to-day transactions. Joint accounts aren’t just for married couples. They can also be used by roommates and family members.
With a joint bank account, account holders are able to deposit and withdraw money freely. By having a joint chequing account, roommates who have shared expenses can use this account to place their regular monthly contributions. Joint accounts for spouses/partners are also useful since a higher combined balance can help to avoid monthly banking fees and estate planning is simplified as the remaining account holder automatically has access to the funds held in the joint account. Joint accounts are also useful if an elderly parent requires help in managing and maintaining their financial affairs.
When not to use a chequing account
A chequing account may not always be the best account for you depending on what you plan to use the account for. If you’re looking to put money away for a vacation or a major purchase, a high-interest savings account will be your best bet.
This is because a high-interest savings account will provide you much more interest on your account balance than a chequing account. Since you’re mainly going to be making deposits into this account, you only require the features that are available with a savings account.