A bank account is required to conduct most business transactions in the U.S. You will need a checking account to be able to pay bills, rent, deposits for housing etc. Typically, to open a bank account you will need a social security number, but most banks will allow you to use your student ID number. Be sure to give your social security number to the bank as soon as you receive one.
Banking and Finance
It is a good idea to open a bank account as soon as you can.
Choosing a Bank
- Look for a branch near your home or school.
- Services needed
- Checking and/or savings accounts, overseas wire transfers, foreign currency conversion
- Saturday banking hours, availability of Automated Teller Machines (ATMs).
- Minimum balances in checking/savings accounts (initial and maintained), monthly fees.
- Interest rates
- For invested funds
Types of Accounts
- Checking account
- Useful if you have bills to pay on a regular basis (credit card, phone, rent, utilities). There is usually no minimum balance required but usually no interest earned either. Some checking accounts earn interest but usually require a larger opening balance. A monthly fee may be charged.
- Savings account
- Earns interest but cannot be used to write checks
Customer Identification Programs (CIPs)
U.S. financial institutions are required to verify the identity of every individual who opens a bank account. In compliance with federal regulation, all banks operating in the U.S. have established CIP which must be followed for anyone who seeks to open an account. Below is the minimal information a bank must obtain from you before allowing you to open an account:
- Your name and date of birth
- Your street address (P.O. Boxes are not acceptable)
- An identification number from one or more of the following:
- Taxpayer ID number (Social Security number or individual taxpayer ID number)
- Passport number and country of issuance
- Alien identification card number
- Other government-issued document evidencing nationality or residence and bearing a
- Photograph or similar safeguard.
What to Bring When Opening an Account
You will be requested to present the following documentation to open a bank account at most U.S. banks.
- Money to deposit
- Your passport and one other form of identification
- Printout of Form I-94 (arrival/departure record) or I-94 card
- Form I-20 (F-1 student) or Form DS-2019 (J-1 exchange visitor)
- Local mailing address: be sure you know all address details (street name and number, apartment number, town zip code). Bring proof that this is your address, such as, a signed lease or a letter you have received there.
- Your mother‘s maiden name: the bank will ask you for your mother‘s maiden name (your mother‘s family name before she was married) or some other family name. This name is used as a security check when you need to contact the bank with questions.
- Taxpayer Identification Number – required by some but not all banks. The following are acceptable:
- Social Security number (SSN)- if you have applied but not yet received your SSN, bring your receipt notice.
- Individual Taxpayer Identification Number (ITIN)- Issued by the IRS to those not eligible for a Social Security number. If you will apply for an ITIN you will need to open your bank account and then apply for an ITIN.
Most banks offer ATM bank cards which enable you to use ATMs to access your account at any time. You can request an ATM card when you open your account or later if you decide you would like one. You will choose a private code called a personal identification number (PIN) to type into the machine each time you access your account.
Debit cards allow you to pay for goods and services directly from your bank account, reducing the need for cash. You can request a debit card when you open your checking or savings account or later if you decide you would like one.
Requirements for obtaining a credit card and interest rates charged on unpaid balances vary among banks. Keep in mind that it is common to have a checking or savings account with one bank and a credit card with another.
Most international students find it difficult to get a credit card in the U.S. because they have not established a credit history* and because they are not U.S. residents. For newly arrived students, you may want to try using a "secured credit card". These cards offer some of the conveniences of a credit card, except that you secure your credit card with a deposit that becomes your credit line. The best part is that your secured card is reported as a regular credit card on your credit report. Check with your bank on the secured credit card.
Because getting a major credit card is very difficult, international students should take every opportunity to establish a good credit history. For international students who have been in the U.S. a little longer, obtaining credit cards becomes a little easier once they have established some sort of credit history.
* See the next topic: Establishing a Credit History in the U.S. for more information on this subject.
Writing personal checks may be new for you. In the U.S., you may pay bills (utility bills, rent, credit card bills) by personal check. You can also often buy things in stores and pay for restaurants by check (as long as you have a credit card and/or picture identification with you, too). Although on-line bill paying and credit card payments are becoming more popular, most people need to use checks occasionally.
If you write a check for an amount you do not have in your checking account (called an overdraft or a bounced check), you may be charged a penalty fee, even if you have plenty of money in another type of account in the same bank. Some banks offer overdraft protection, but you may not qualify if you do not have income or a credit history in the U.S.
A wire transfer is the method of transferring funds from one entity to another, such as, from one bank account to another. After you have set up your new bank account, you can arrange for a wire transfer by providing your bank with your U.S. bank details. You will need to provide your account number, the U.S. bank's name and address, and the U.S. bank's ABA number. Wire transfers typically take between 2-5 days. Ask your bank for a confirmation once the funds are wired.
Most banks offer safe deposit boxes to protect your valuables. If you have irreplaceable items or important documents that you would like to secure in a safe deposit box, you can rent a box on an annual basis through your bank. The box is kept in the vault of the bank and is protected by bank security. You will have a key to the box but will only have access to your valuables during banking hours.
Establishing Credit History
A creditworthy person is one who has a positive credit history and meets other requirements as determined by the lending institution.