How To Use A Bank, An ATM, And Online Banking

What is a bank?

According to, “A bank is a financial institution licensed to receive deposits and make loans. Banks may also provide financial services, such as wealth management, currency exchange, and safe deposit boxes.” states that a bank is “an establishment authorized by a government to accept deposits, pay interest, clear checks, make loans, act as intermediary in financial transactions, and provide other financial services to its customers.”


What is an ATM?

According to, an ATM, which stands for Automated Teller Machine, is “an electronic banking outlet, which allows customers to complete basic transactions without the aid of a branch representative or teller.” states that an ATM is a “computerized machine that permits bank customers to gain access to their accounts with a magnetically encoded plastic card and a code number. It enables the customers to perform several banking operations without the help of a teller, such as withdraw cash, make deposits, pay bills, obtain bank statements, and effect cash transfers.”

In addition to using a debit card, some ATMs can be accessed through other methods, such as entering a special code that’s first delivered to a customer’s phone.


What is online banking?

According to, online banking allows a user to execute financial transactions via the internet. Online banking is also known as “internet banking” or “web banking.” An online bank offers customers just about every service traditionally available through a local branch, including deposits, which is done online or through the mail, and online bill pay.” states that online banking is a “computerized service that allows a bank’s customers to get online with the bank via telephone lines to view the status of their account(s) and transaction history. It usually also allows them to transfer funds, pay bills, request check books, etc.”


What can happen if you don’t use a bank?

  • Waste time.
    • Can take longer to get paid.
      • Employer has to cut you a check, and then you have to take it to the bank to cash.
  • Can take longer to pay bills.
    • Time to drive to the post office to deliver the payment.
    • Time for the payment to be delivered in the mail.
    • Time for an employee at the company you are paying to process the payment.
  • Can take longer to make payments at stores.
    • Carrying and counting out cash and change can be time consuming.
  • Waste money.
    • Budgeting may be difficult.
      • It may be hard to know how much money you actually have if you’re carrying around uncounted cash and change and don’t know how much you have in addition to what’s in your possession at the time.
    • Cost of packing and postage to mail bill payments.
    • No opportunity to earn interest on balances.


How is using a bank beneficial?

  • Safety/Security.
    • Money is protected by the Federal Deposit Insurance Corporation (FDIC) up to a certain amount.
  • Earnings.
    • Some savings and checking accounts allow you to earn interest on the money in your account.
      • This means that your money can make money just by being held in the account.
  • Organization.
    • Bank statements can help you stay organized with creating and maintaining a budget.
    • See learning resource Budgeting under Finance for more information on creating a budget.
  • Save Time.
    • Can make getting paid easier.
      • Employers can directly deposit the money into your account rather than cutting you a check, which you would then have to deposit.
    • Automatic bill pay can withdraw money from your accounts automatically to pay your bills, ensuring that your bills are paid.
      • Make sure you have enough funds in your account to cover the automatic withdraws, or you may receive an overdraft charge.
    • Can make payments at stores faster.
      • It’s often quicker to swipe your debit card than it is to count out cash and change.
    • Can pay bills faster.
      • Time it takes to mail in a payment, including driving to and from the post office, waiting in line, etc. is generally eliminated.
  • Save Money.
    • Paying bills through online banking can costs less than a money order. Plus, you’ll have record of the transaction.
    • Can transfer money to other people’s accounts, and some services offer this free of cost.
    • Cost of mailing in a payment, including packaging and postage.
  • Accessibility.
    • You can access your funds from multiple locations. For example, pretend that you’re out-of-state and are in need of a medication that you didn’t know that you’d need. The medication is a little expensive, but you have the funds saved, so it’s not a huge deal for you. If your money is all saved at home, say under your mattress, you wouldn’t be able to access it; however, if your money was saved in a bank account, you could pay for the medication by withdrawing the money using an ATM, paying with your debit card, or paying with your bank account via an additional electronic method.
    • If you plan to share finances with someone, such as a partner or spouse, it may be easier to both have access to the funds via a bank account as opposed to sharing cash.


How to get started with a bank, an ATM, and online banking.

You will generally set up your bank account(s), ATM access, and online banking with the same bank, so your first step will be to choose your bank.

Then, you can either call or email ahead of time or walk into the bank and ask to speak with a representative in order to set up your bank account.

Once you meet with a representative, he or she should answer all of your questions and set everything up for you. Even if you feel stupid or silly, if you have questions, ask! Everyone has to start somewhere, and you are showing responsibility. Be proud of yourself!


Here are some tips to help you with opening your account:

  • Make sure you’re eligible to open an account.
    • If you’re under 18, some banks may require parent/legal guardian signature.
    • You may be required to have a minimum deposit amount to open the account.
    • You will generally be required to provide basic information.
  • Research banks before making a decision.
    • Large, chain banks may offer more locations than smaller banks.
    • Smaller, local banks may offer a more personal banking experience.
  • Pick your account(s).
    • Checking.
    • Savings.
    • Both.
  • Prepare questions for the financial representative.
    • Is there a monthly fee?
      • If so, what is it?
    • Is there a minimum balance to stay open?
      • If so, what is it?
    • What is the interest rate on my savings account?
    • How often does my savings account generate interest?
    • Are there any fees for withdrawing cash from an ATM?
      • ATM belonging to the bank?
      • ATM not belonging to the bank?
    • Are monthly transactions limited?
      • If so, what are the transaction limits?
  • Prepare identification documentation.
    • Contact the bank ahead of time and see what documentation, if any, you will need to bring with you in order to open your account.
      • Proof of identification, such as a driver’s license or passport.
      • Proof of address, such as a utility bill with your name and address on it.
      • Proof of registered citizenship, such as your Social Security card.
  • Ensure security of documents and information.
    • Your pin number.
    • Your bank account number.
    • Your Social Security Number.
    • If you feel that this information has been compromised (ended up in the wrong hands), you can call your bank and request to “freeze” your account so that no one else will be able to access your money.


Do your own research! No Longer Silenced Movement encourages you to do your own research about topics of your interest in order to formulate your own educated opinion.