Question: Help! I Can't Open a Checking Account, What Are My Options?
If you are unable to open a checking account you may be at a loss on what you are going to do to pay your bills. Many people take for granted the benefits and advantages that a checking account affords them. It is easy to write checks and pay your bills online with automatic draft. If you find that you are unable to open a checking account you do have a few options available to you.
First, you should look at other banks and credit unions in your area. You may not qualify for the best account at the bank, but many banks may work with you by having you pay higher fees. You may be required to open a CD as collateral for your account. Credit unions are generally much easier to work with as well. You should find a bank that will allow you to open a savings account. This will help you to build a relationship with the bank, which may open the door in a few years.
If you have been reported to ChexSystems, then you will need to clear up the report before you can open an account. Generally, this means that you owe a bank money for an account that you have overdrawn. The bank may have closed your bank account for you, and refuse to do business with you in the future. If you go in and talk to the bank, you can find out how much you owe and work out a plan to pay it off. They may want you to make a lump payment, which means saving up for a few months or weeks to pay it off. Most banks will not even let you open a savings account until you have cleared up your ChexSystems report.
If you find that you cannot find a bank or credit union that will work with you, you will need to address the way that you pay your bills and mortgage. You may need to switch to money orders for some of your major bills. You should never send cash through the mail. You can purchase money orders through your bank, the post office or many other locations. You should shop around and find the price that is right for you. When you pay this way be sure to include your account number on each money order. You should also keep a ledger at home that states the money order number and place that it was purchased and what bill it went towards in case it becomes lost in the mail. You can also use a prepaid credit card to pay bills online. This option may make it easier to keep functioning without an account.
This is an excellent time to switch to the envelope budgeting system. You should not resort to using credit cards for the majority of your purchases. You do need to add to the financial mess that got you here in the first place. By switching to cash only you can begin to discipline yourself for when you are able to open an account again. The biggest advantage is that once your money is gone it is gone and there is no way to keep spending it. This does mean that you need to budget carefully.
Additionally, you may consider getting a prepaid credit card to make online purchases or to rent a car. These cards will not allow you to spend over the amount that you deposit on the card. You will pay a fee every time that you deposit money, but the convenience may outweigh the cost when you are in this type of financial situation.
You should make a commitment that you will begin to live on a budget and get your finances under control so that you are never in this situation again. You may have a few tough years ahead of you, but you can come out ahead if you stick with the program and begin taking control of your spending and saving habits. This will help you to turn this headache into a positive situation.