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7 Factors That Actually Matter

Bank Accounts

7 Factors That Actually Matter


Carmen Mandato/Codetic

Checking accounts offer a convenient way to manage your funds, but not all checking accounts are created equal. If you’re tired of your current checking account or you’re thinking about opening one for the first time, there are a few things you need to consider. 

How to Choose a Checking Account: 7 Factors to Consider

If you’re wondering how to choose a checking account, ask yourself these questions to determine which account is right for you:

1. Can You Sacrifice Convenience for Lower Fees and Higher APYs?

One of the biggest decisions you’ll need to make is whether you want a traditional brick-and-mortar bank or if you’re willing to keep your money in an online checking account

While there are several key distinctions, it really comes down to your comfort level with an online-only bank, whether you need in-person assistance and how much interest you want to earn; online banks tend to offer much higher APYs because of their lower overhead costs.

Some other considerations:

  • Online banks typically have fewer (or no) fees for overdrafts, foreign transactions and ATMs.
  • Online banks usually have superior mobile apps, but traditional banks are catching up.
  • Brick-and-mortar banks make it easier to deposit cash.

2. Are You a Frequent ATM User?

If you frequently make cash withdrawals via an ATM — or you think you will once you open your first checking account — choose a bank with locations all across the country. Access to ATMs and various branch locations is especially important if you’re paid in tips and frequently need to deposit cash.

Alternatively, you can find a bank that belongs to an ATM network, meaning even though your bank’s logo might not be on a specific ATM, you can still use it to deposit and withdraw money — potentially fee-free.

3. Can You Meet Minimum Balance Requirements?

Checking accounts often have minimum balances. If you don’t plan to keep much money in your checking account on a regular basis, find an account with no such fee.

If you intend to keep more money in your checking account, perhaps for easy access in emergencies (especially for those who don’t have or want credit cards), find a high-interest checking account.

4. How Often Do You Travel?

Traveling domestically is more convenient when you choose a bank with a large, national ATM network. 

But if you travel abroad regularly and don’t have a no-fee credit card, you should find a checking account that offers a debit card with no foreign transaction fees. This will allow you to swipe your card at foreign restaurants, shops and airlines or withdraw funds from an ATM without incurring fees.

5. Are You OK With Having Your Checking and Savings at Different Banks?

Do you already have a savings account at a bank? If so, transferring funds from checking to savings and vice versa is much easier when the accounts are linked at the same bank.

However, you have the potential to get better rates if you keep them separate. Bank A may offer a higher APY and lower fees for its checking account while Bank B might have superior APYs and a larger ATM network for its savings account. Diversifying your checking and savings accounts can optimize your earnings and reduce spending on needless fees.

6. Is There a Sign-up Bonus?

Banks often run promotional offers — typically a cash bonus when you open an account and keep X amount of money in it for a specified amount of time. If you’re considering a handful of similar accounts with no important distinctions among them, go with the one that’s currently offering the best sign-on reward.

7. Should You Choose a Credit Union Instead?

Banks aren’t the only institutions that offer checking accounts. If you meet the qualifications to join a credit union, you may find a better account for your needs there. Use our guide for choosing between a credit union vs. a bank.

Ready to start looking for an account? Here are some of our favorite checking accounts.

Timothy Moore leads a team of editors and graphic designers at a market research company as his full-time gig. As a freelance writer, he writes about personal finance, careers, education, pet care, travel and the automotive industry. His work has been featured on Debt.com, The Ladders, Glassdoor and The News Wheel.

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