Congratulations on opening your first bank account! Now, you just need that shiny new debit card to arrive in the mail and you’re all set. But you don’t have to wait for your debit card to start taking advantage of all the benefits that your bank or credit union has to offer. 

Thanks to online banking, you can access your account with the tap of a finger without having to visit a brick-and-mortar branch. You can even opt for a financial institution that is 100 percent online.

What Is Online Banking?

Online banking is the act of conducting banking transactions online. When you log in, you’ll be able to:

  • View balances, transaction history, routing numbers, and account numbers for all your accounts
  • Download account statements
  • Transfer funds between your accounts in real-time
  • Send secure messages to customer service if you need help with your account (some banks and credit unions also offer a live-chat function or allow you to make an appointment to see a financial advisor at a physical branch)
  • Update account settings, including account alerts and identifying information

How do I set up my account??

To access your account electronically, you’ll need to enroll using your account information. You can do this using the bank’s website or mobile app.

If you use the website, visit the homepage, and look for the button or hyperlinked text that says something such as “access your account online” or “login.” Click the link and instead of entering a username and password, select the button that says “register” or “enroll.”

If you prefer to use your smartphone to access your account, download your financial institution’s app. Next, click on the “sign up,” “enroll,” or “register” text; select your account type; and enter the requested information. This information is used to validate your identity and can include a combination of your name, address, Social Security number, zip code, date of birth, and phone number.

Quick note: You can register on your computer and use the same credentials to manage your account via mobile app. (And with some banks or credit unions, you might have to visit the branch to initially sign up for online banking.)

Other Benefits of Online Banking

1. Mobile Deposits

If you haven’t enrolled in direct deposit at your job and are still receiving paper checks, online banking takes the hassle out of having to wait in line at the bank or pay a check-cashing company to get your money. Instead, you can log into the mobile app; snap pictures of the front and back of the check; and enter the requested info. Problem solved. This feature will work for virtually any check, including those you receive as gifts from family members.

2. Cross-Account Transfers

What if you need to transfer money to one of your other accounts to cover an expense? There’s no need to write a check to yourself or to physically visit the bank, withdraw the funds, and deposit them into the other account.

With online banking, you can link external accounts and initiate cross-account transfers. You may want to do this when you initially set up your account, as the verification process may take a few days.

3. Sending Money to Other People

Do you owe money to a family member or friend or need to lend them some cash because they’re in a financial bind? Several financial institutions have partnered with payment services like Zelle or Venmo to help consumers quickly get money where it needs to go. A nominal fee may apply any time you transfer money, but it beats a wire transfer, and the money will reach its destination in as little as one business day.

4. Opening a New Account

Are you considering a savings account to help reach financial goals like paying for prom, buying a car, or saving for college? You don’t have to visit the branch to fill out the application. You can usually do it online. If you meet the eligibility requirements, your account will be ready for use on the same day. If there’s a minimum opening deposit, you can fund your account from the online dashboard, as well.

5. Applying for a Credit Card or Loan

Are you ready to apply for your first credit card or loan? You may be inclined to visit the branch and get the ball rolling in person with a financial advisor. But you may also be able to upload the required documentation, complete the process online, and get approved without stepping foot in the branch. Even better, the application may be pre-populated with the information that the bank already has on file for you.  

Remember: If you apply for a loan, you will be expected to pay interest on it. All that information, such as what the interest percentage on the loan will be, should be presented to you upon applying for the loan. Interest is what it costs you to borrow someone else’s money. When it comes to credit cards, interest rates are often higher for overdue payments. If you aren’t eighteen yet you may need your parents to cosign the loan with you.

6. Paying Bills Directly from Your Account

This is one of the most desirable features of online banking. No more heading to the post office to drop checks in the mail or scheduling payments on 20 different websites across the web. With online banking, you can pay all your monthly bills directly from the dashboard (though a small fee may apply for this service).

7. Viewing Your Credit Score

If you don’t have a credit score yet, this feature won’t be as beneficial to you. But once you enter the world of credit, you could save yourself a few bucks per month by viewing your credit score for free from the online dashboard. Your credit score is important because it lets organizations who lend money know your track record on repaying money you’ve borrowed..

8. Spending Trackers

Need help managing your money? Most banks have this covered, offering budgeting tools directly from the dashboard to help you track your spending and set financial goals.

The Bottom Line

Online banking is something you want to consider to simplify managing your money. But make sure to protect your log-in information and frequently review account activity to minimize the chances that your account will be compromised.  Also, be sure to shop around.  Many banks and credit unions offer student accounts that don’t have minimum balance requirements or other benefits.  Be a savvy consumer and never be afraid to ask questions when it comes to your money.