Online banking is one of the newest forms of banking, and it seems every traditional (and not so traditional) bank is offering online services or completely automating their activities on the internet. It may be that you have only a few bills to pay every month or that you’re still learning to navigate the web effectively. But if you are online and deal with financial matters on a semi regular basis, you’re probably ready for online banking.

Online Banking
Online banking is simply banking over the internet. The term can refer to online bill pay and traditional account services that can also be done at a banks store front location. Online banking can also mean loans, investments and other instruments are applied for, set up and managed online. With online banking, you can easily compare interest rates between loans and companies, and you’ll often finds rates are more favorable when you search online as you’re able to access small and large banks not in your local area as well as banks completely online.

If you already have an account at a local bank, be it large or small, there is a good possibility that you are only a step or two away from online banking. Increasingly banks are offering more services online not only as a convenience to customers but as a means of saving money. Transactions processed online cost less than transactions processed in a bank office as online transactions don’t require a teller’s assistance.

Another major advantage of online banking is the ease of use and the freedom it provides. If you keep unconventional hours or just like to pay bills in the middle of the night, you can. Having a burning itch for a new car at 2am? Compare rates and even arrange financing before the sun comes up. Online accounts are open twenty-four hours a day, seven days a week. And most online banking accounts allow you to transfer money between accounts, pay bills and take care of other small maintenance items at your convenience without ever setting foot near a bank or ATM.

Are You Ready for Online Banking?
There are a few signs that it may be time to move your banking online.

You’re interested in trying it out. Even if you’re not sure you want to give up your checkbook and face-to-face transactions entirely, you can try online banking and still have the option to switch back and forth as you decide if you like it. You can also easily close your online accounts if online banking proves to be bothersome. It is more likely, however, that you’ll find online banking far more convenient than you imagine.

You already know the internet. If you can navigate a few places online, you can probably handle the amount of web surfing required for online banking. If you have never heard of a modem, internet service providers or know how to pull up the internet, online banking may be better after you’ve learned the ropes. Chances are, however, that you’re reading this online, so you must know what you’re doing. You should also be comfortable discussing your finances online. If you still keep your money buried in the backyard, online banking might not be for you.

You pay lots of bills. If you just write one or two checks every month, the cost of postage isn’t daunting. But if you’re writing out ten or twenty checks every month complete with account numbers and pressing hard to make good carbon copies, the hand cramping and tedium may very well be enough to drive you online. Online bill pay can save you countless amounts of time once you invest the time initially to have it set up. You can also check your account balance at a whim to see which payments have processed.

You use money management software. If you’re already keeping track of your finances using Quicken or Microsoft Money, online banking is the next logical step. Many online banks will even export data to your hard drive easily or automatically when you log in to your online accounts. This makes money management a breeze – especially at tax time.

There are very few disadvantages to online banking. The most daunting is finding out how to get the service set up and then working through those steps to open your own online accounts. If you already have bank accounts, speak with your banker or visit your bank’s website to find out if online banking is just a matter of filling out a quick online form. Many banks only require existing customers to activate accounts which takes less than an hour. While this may be slightly longer than paying bills by hand, the initial time you invest setting up the service will pay off substantially down the road.

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