We are all creatures of habit. Many of us have banked at the same place for years without considering other options. But is your current bank really the best fit for you?
Interest rates are always changing and fees always seem to be increasing.
Even if you’ve always had the same bank, you could be hindering your financial options. It never hurts to shop around.
By picking out the right bank for you, you will be setting yourself up for financial success. The wrong bank will hit you with a ton of fees, not give you interest to grow your wealth, or might not have the services you are looking for.
If you are shopping around for a new bank, here is how to find the best bank for you.
Know Your Options
As far as banking goes, there are numerous options for you to choose from. Some of the most common options are as follows:
- National banks
- Local banks
- Credit unions
- Online-only banks
Each of these options has their pros and cons. Big banks, like Everbank, Wells Fargo, and Bank of America, are more accessible, but typically have lower interest rates on savings. Smaller banks likely have better customer service and have lower fees, but they aren’t as convenient and may not have as many features and services to offer. Credit unions often charge fewer fees, but customer service might not be as readily available, while online banks are solely online and lack any physical teller.
There are pros and cons to each type of bank. One options that works well for you might not be fitting for someone else.
Compare Rates and Fees
Each bank or institution will have different fees and charges for various reasons.
Aside from the potential cost of an account itself, fees tend to affect people who don’t always have the best banking habits. If you have a history of frequent overdrafts, utilizing ATMs, or failing to meet the minimum balance your bank requires, you’ll especially want to take a detailed look into fees.
Make sure you compare whether there is a monthly maintenance fee, cost for accounts, overdraft fees, ATM fees, and other potential fees. These can really add up, and no one wants to have unexpected charges because of a fee they weren’t aware of.
Further, you can compare interest rates of each bank. Rate sheets can usually be found on a bank or credit union’s website or in the bank itself.
It should be noted that online banks, like Chime, are able to provide significantly higher interest rates because they do not have to maintain the cost of a physical brick-and-mortar bank. If you’re okay without having a physical bank, online banking is an excellent option.
Look for Banks that Allow Multiple Savings Accounts
Do you ever get overwhelmed by how you’re supposed to separate your emergency fund, vacation fund, immediate savings fund, or any other things you are saving for?
It can be confusing and difficult to save when you are only allowed one savings account, which requires you to lump together all of your money into one. Luckily, many banks are now giving you the option to create as many savings accounts as you want.
I personally bank at an online bank that allows me to create multiple savings accounts, and it has changed how I save drastically. Now, I can set savings goals in each separate account. It is actually fun to see how much I can save.
It should be noted that this is a must for any blogger or anyone with other side hustle income. If you don’t have a totally separate business account, you at least need your own saving and checking account for your income and expenses.
Consider Amenities and Technology
Everyone has different banking preferences, so it’s important to look into what is best for you. For example, would you want to use an app to do your banking? What about an auto-bill feature? Or remote check deposits?
Many small branches and credit unions won’t offer as many amenities as nationwide or online banks will. Keep in mind, if you’re looking into online banking, the technology it offers is something to deeply consider, as you won’t have any physical branches to assist you (though you will have access to customer service via phone call or online chat).
Prioritize Your Checking Account
If you’re not sure what you should first look for, consider comparing options of checking accounts.
Savings accounts might have a slight variance in interest rates, but focus your attention on checking accounts. A checking account actually allows you to use your money, and you don’t want any hiccups along the way. Some things to consider when looking for a checking account are:
- Is there a required minimum balance?
- Is there a fee to utilize a checking account?
- What are the overdraft fees?
- Is online banking an option?
- How much are checks?
Asking yourself these questions will give you a guide as to what checking options are the best for you. Free checking accounts do exist, like Discover, making it ideal, because who wants to pay to access their own money?
How Safe is Your Money?
We know the importance of health insurance, rental insurance, or car insurance, but have you ever stopped to consider how you should insure your money?
When looking for a bank, make sure it is insured by the Federal Deposit Insurance Corp, or FDIC. For credit unions, they will be insured by the National Credit Union Administration. This insurance will cover what you have deposited in the bank up to $250,000 if the bank should ever fail.
While most banks and credit unions are insured, it is good to double check to ensure you are covered. Deposit insurance does not cost you anything, and worst case scenario, you could lose everything if the bank failed and you were not insured.
Have you ever switched banks? What caused you to switch? If you’ve never switched banks, why not?
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We primarily bank at our local credit union for the low fees & free checking account, but, our savings is at an online bank.
The only time I’ve really switched banks is from Charles Schwab High-Yield Checking during the Great Recession when checking account interest rates dropped to near-zero & have remained there since.
I do the same as you – a credit union checking but savings are all online :) It’s the best of both worlds for me!
All good tips to keep in mind when looking for a bank. We bank with US Bank and have done so for years basically just out of convenience since it can be a hassle to change banks. We do our business as well as our personal banking there, plus they’re everywhere we tend to travel so that makes it convenient in case we have a need while on vacation. For all of our savings though we use an online bank so we can get a HY savings account. Granted, it still isn’t much but better than the .0001% – or whatever it is US Bank pays out.
That’s great to hear that you found what works for you. I’ve considered switching to a larger bank, as I know I won’t live where I do forever, but ultimately, a credit union is a good fit for me now. I also have my savings online. Any little bit of extra interest helps!
This is all so spot on! Rates and fees were very important to me, and so was being able to have multiple bank accounts! I am so glad I was able to find a bank that checked off both of those!
Thanks, Chonce! Having multiple bank accounts is so unbelievably helpful to me. It really helps me to be much more intentional with my savings!