If you are planning to move to the United States for a longer duration, the first thing that you will need there is a local bank account.
As a newbie, you may face many challenges in opening a bank account for yourself. You might not be aware of the rules and regulations and the process of setting a bank account.
So, to cater to your problems, we have provided a complete guideline on how can you open a bank account in the US.
Stay attached to this article if you are interested in knowing the complete process of opening a bank account in the US.
Why there is a Need to Open a Bank account?
If you wish to stay in the US for a longer duration, you must open a bank account there. It’s almost impossible to survive without a bank account in the US.
A bank account is needed to avail almost all the necessary living facilities. For example, you may need a bank account to avail services of the mobile phone or an internet plan.
Moreover, if you are doing a job in the US, then you will require a bank account to receive your monthly salary. Similarly, if you want to buy any property or do any type of investment, you will need a bank account to make the transactions.
Contrarily, if you do not have a bank account in the US, you will have to pay a massive amount as an international banking fee.
Types of Bank Accounts that you can open in the US
Here are four different types of bank accounts that you can open in the US. Depending on your needs, requirements, and eligibility, you can choose any one of the following that suits you the most.
1. Correspondent Bank
A correspondent bank account is an account in which the bank in your native country has a relationship with a corresponding bank in the US and allows you to open a bank account there.
This deal is limited to a few banks only. Not all banks possess such type of relationship.
2. International Bank Account
By International bank account, we mean to open an overseas bank account. The drawback is that you will need to deposit a considerable amount of money in the bank upfront to open it.
Furthermore, you will also have to manage a high balance in your account, which is only possible if you are doing some sort of business in the US.
3. Visit the US to open a Bank Account
If you have reached in the US as a newbie, you can visit a bank in the US to get your account opened there. You will be asked to show certain documents, as mentioned above. So, don’t forget to take them with you.
4. TransferWise Borderless Account
Transfer Wise is the best option if you are running a small online business and want to get payments worldwide.
With a Transfer Wise account, you can open and manage your account online. Moreover, you can also keep your money in any of over 40 different currencies all in the same place.
Checking Account VS Savings Account
Most of the bank accounts in the US are either checking or savings bank account. Before you start the application, you have to decide which account do you want to open. Let’s discuss which to choose.
Checking or Savings Account
A Checking account is just like the current account, which we open in our native country. Contrarily, savings account allows you to save money over time. You will save money in the form of interest that you will get on your savings.
If you need the money to pay regular expenses, we suggest you open a checking account. But make sure it doesn’t charge too much fee.
If you wish to save money, make sure the account earns a reasonable interest rate. But be very clear that there are often many restrictions on how often can you withdraw money from a saving account.
Single or Joint account
If you open a single account, you’re the sole owner. On the other hand, A joint account is one you co-own with another person. He can be a family member or friend.
Documents Needed to Open a Bank Account in the US
The requirements usually vary from one bank to another. So, before going to any particular branch, ask them what documents do they require. You can ask about the documents needed by calling their helpline.
Generally, the banks require the documents that prove your identity and residential address. Following is a list of documents that are usually needed.
- Your credentials, including name, contact number, and residential address, etc.
- Any Identification Card issued by the state e.g., driving license
- Your Social Security Number (SSN)
- Bank Account Opening Deposit Slip
- Immigration Documents
- An Initial Deposit ($10 to $100)
Some banks may also require your passport or the utility bill containing your name and your US address.
The documents can either be submitted online or by visiting a branch of that particular bank.
Can I open a Bank Account in the US from Abroad?
You might be wondering that is it necessary for me to be physically present to open a bank account, or can I also open it from overseas? So, let’s discuss the possibilities.
If you are a US citizen and possess a Social Security Number (SSN), then you can apply to open a bank account online. Many reputable banks allow US citizens to open their bank accounts by applying online. So, as a US citizen, you can open a bank account even if you are living abroad by applying through the online portals of the banks.
However, if you are not a US citizen and do not possess an SSN, you will not be allowed to open a bank account online. Not only will the banks demand an SSN, but also will they ask you to visit their branch in the US to get the account for themselves.
The Process of Opening a Bank Account in the US
The process of opening a bank account varies from bank to bank. So, you just have to follow the instructions given by the bank in which you wish to open the account.
As described earlier, US citizens may open the bank account by applying and submitting the documents online. However, if you are not a citizen of the US or do not possess an SSN, you will have to visit the branch in person to open a bank account.
So, for visiting the branch in person, you can book an appointment online with your local branch. At the designated time, visit the branch along with all the necessary documents, including bank account opening deposit slip.
Once you reach the branch, a customer service representative will thoroughly guide you on how to proceed further. Once the process is complete, the bank will send your debit card and PIN to your designated residential address later.
Fee Structure
The charges you will have to encounter for opening or to maintain a bank account will depend on the bank you choose and the type of account you wish to open.
Basic accounts usually have a low monthly fee but offer fewer benefits. In contrast, premium accounts come up with several benefits such as free international ATM withdrawals but have a high monthly payment.
So, depending on your requirements and use, you can either choose to open a basic account or a premium account. You can ask about the fee structure from the customer representative if you visit the branch or can check online on the website if applying online.
In general, the prices range from $10 to $15 a month for a basic account and $25 to $100 a month for a premium account.
Moreover, many banks offer an advantage to their customers. If the account holder maintains a minimum set amount in his bank account, the monthly fee can be waived off.
ATM With drawl Fee
ATM with drawls from the ATMs operated by your bank might be free in most of the cases. But all banks charge a certain amount of money if you generate withdrawal from an ATM that is outside the network of your bank.
The amount charged varies from bank to bank. So, you can ask the customer service representative that how much amount will be charged for one withdrawal that is made from an ATM, which is outside the network of your bank.
Keep in mind that the amount charged for making international with drawls using your US debit card will be much higher as compared to local with drawls.
So, avoid using ATM for international with drawls while traveling.
International Transfer Fee
After opening a bank account, if you want to make an international payment (also called Wire Transfer), you will have to pay a considerable amount of fee for that. The upfront charges vary from bank to bank but usually range from $30 to $50.
Before sending the payment, either read the instructions carefully or ask the customer services representative because you might be charged some hidden fee. So, get everything clear before making a transaction.
Corporate Bank Account
Apart from opening an individual bank account, the other option is that you can open a corporate bank account in the US. A corporate bank account can only be opened if you plan to open a company in the US.
This option is most suitable for those who do business and get online payments with companies in the US.
Can I Open a Bank Account Using ITIN instead of SSN?
As a non-resident and non-citizen in the US, you won’t have an SSN, which is necessarily required for opening a bank account in the US.
However, even if you do not have an SSN, some banks will allow you to open a bank account based on your ITIN (Individual Taxpayer Identification Number).
How to Open an Account Without Going to the US?
As a non-citizen, if you lack the required documents, SSN, or you cannot go to the US to open a bank account, there is another golden deal available for you.
Transfer Wise Borderless Account
In this situation, you can open a Transfer Wise Borderless account. With a Transfer Wise account, you can open and manage your account online. Moreover, you can also keep your money in any of over 40 different currencies all in the same place.
Transfer Wise is the best option if you are running a small online business and want to get payments worldwide.
A Transfer Wise Borderless Account also provides you with the UK, European, and Australian bank details, so it is a great option to send and receive money from other countries.
Although many banks such as Citibank, Chase, Bank of America, and Silicon Valley Bank offer online bank accounts or online banking services, yet this is the least used solution. The reason is that the process is quite a long process, and your account may still be disapproved due to insufficient identity verification.
Conclusion
Having realized the importance of having a bank account while living in the US, you might be thinking of opening an account for yourself. If yes, then follow the instructions above and visit a bank in the US in which you want to open your account.
If you are facing any difficulties, you can ask us in the comments section below.
