Money Moves

Money Moves

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What is a Checking Account and How Can You Benefit From One?

A checking account is one of the most important tools that you can have in your financial toolbox. It's a versatile account that can be used for a variety of purposes, and it comes with a range of benefits that can help you save money and time. In this article, we will discuss what a checking account is, how to use it effectively, and some of the benefits that come with having one.

How does a checking account work?

A checking account is a bank or credit union account that allows you to deposit money, withdraw money, and spend using a debit card and checks. You can use your checking account to pay bills, shop online, or make in-person purchases. When you use your account to make a purchase, the money is withdrawn from your account and transferred to the seller. 

One of the key benefits of a checking account is that it allows you to manage your finances in one place. You can see all of your transactions in digital banking, which makes it easy to track your spending and budget for the future.

Why should I have a checking account?

Using a Debit Card

When you open a checking account, you will be able to use a debit card. A debit card is linked to your checking account and allows you to make purchases without having to carry cash.

When you use your debit card, the money is deducted from your checking account balance. This is a convenient way to make purchases and can help you avoid carrying large amounts of cash.

Debit cards are safer than cash because if your debit card is stolen, you can cancel the card to prevent more fraudulent purchases from being made and save the money in your checking account. If your cash is stolen, you're out of luck. 

Learn more in our other article: Understanding Debit Cards

Writing Checks

Yes, people are still writing checks these days. Some vendors, contractors or institutions are still only taking payments via written check instead of using software to manage payments. Having a checking account allows you to have a checkbook that you can use for such payments when a debit card and cash are not viable options.

When you write a check, the recipient will deposit the check into their own account and the funds will be transferred from your account to theirs. Think of it like an old-school Venmo. Purdue Federal members can print a check to a branch all within digital banking and the mobile banking app.

Direct Deposit

If you have a job, your employer may offer direct deposit. With direct deposit, your paycheck is automatically deposited into your checking account on payday. This is a convenient way to receive your wages and can help you avoid having to cash a physical check. 

From your direct deposit into your checking account, you can then set up an automatic transfer from your checking into a savings account so you can start saving regularly.

Purdue Federal members can easily access the direct deposit information for their checking accounts in digital banking. Download a PDF of direct deposit information for a particular deposit account and you're good to go!

Automatic Bill Pay

Another benefit of having a checking account is that you can set up automatic bill pay for your recurring bills. This means that instead of receiving a paper bill in the mail, the funds will be automatically withdrawn from your checking account to pay the bill on time.

How can I use my checking account effectively?

There are a few things that you can do to make sure that you're using your checking account effectively:

Keep track of your balance

It's important to keep track of how much money is in your account so that you don't spend more than you have available. You can do this by logging into digital banking or by keeping a running tally of your transactions.

Use direct deposit

If your employer offers direct deposit, sign up for it! This will help you avoid having to cash a physical check and can make it easier to keep track of your account balance.

Set up automatic bill pay

If you have recurring bills, set up automatic bill pay so that you don't have to worry about forgetting to pay a bill on time. This will also help you build a solid credit history by avoiding late fees.


Checking accounts are helpful tools that can make managing your finances easier. Keep track of your balance, use direct deposit, and set up automatic bill pay to make the most of your account. With a little bit of effort, you can make sure that your checking account works for you!

The information and topics featured are for informational purposes only and does not constitute legal, tax or financial advice. All financial situations and circumstances are different and may not apply to the specific information provided. Seek the advice of a financial professional, tax consultant, or legal counsel to obtain guidance specific to your needs.