Choosing the Right Bank Account

Not all banks are created equal, and not all account options are the same. You may get higher interest, but be paying higher fees.  You need to chose a bank account that is right for you and your needs.

Consider the following when choosing a Bank:

Can you qualify for special accounts?

There are banks and account options specifically geared towards Senior Citizens, Students, or Military Families.  Seniors tend to use their debit card less, write more checks, and make withdrawals less frequently than other checking account holders, and the accounts offered to them reflect this difference. Senior checking accounts tend to come with free checks. Student Accounts are aimed at those 18-24. Features include unlimited free check writing, no monthly service fee, and a few non-bank ATM withdrawals each month with no charge from the bank.  Military families not only have options for accounts, but also specific banks. Military Banks tend to be more lenient on fees and options.

How Many Accounts do you need?

If you keep a savings account at the same bank as your checking account, you can get discounted perks or no annual fee credit cards. Look at the options of bundling your accounts at one location.

What will be your Average Account Balance?

You will pay less monthly fees with higher account balances. All require a Minimum Balance though, being as low as $50. The average balance required for a no-fee no interest bearing checking account is around $150.00. To generate interest without fees, you will need to keep a balance higher than $3,000. Interest on accounts these days is so low, it is not really worth paying any extra amount to get a interest bearing account.

Do you need checks?

Checks are being used less and less. But some bills still require a check (Apartments) If you can get away with not writing more than 10 checks a month, then opt out of unlimited check option accounts

How Often will you need an ATM?

If you need cash often, make sure your bank has multiple convenient locations. These tend to be your national brand banks. Smaller banks are now offering X number of free withdrawals, or X dollars back in transaction fees.  ATM fees can be a double whammy (fee from the ATM, fee from your bank from not using their ATM) It is very important that you chose a bank to match your ATM needs.

Think outside Traditional Bank Accounts

If you don't need to physically go to the bank, think about adding a high yield checking account to your financial profile.  High Yield Accounts can offer 10X the interest rate of brick and mortar banks. For list check out: http://www.moneyunder30.com/high-yield-savings-accounts-compared

Credit Unions are great options if you don't need all the bells and whistles of a bank. Credit Unions are not for profit and generally have lower fees than normal banks. The catch is, do you need to meet the membership requirements.  Find a Credit Union near you http://www.asmarterchoice.org/

One final note: Since banks these days have such low rates on traditional saving and checking accounts, try to keep an acceptable balance, but put extra money in higher yield accounts such as Certificate of Deposits. Banks can change the interest rate when they want. CD's have interest rate locked in for a predetermined time. Your bank and online banks (CapitalOne360) have different options for CDs.  www.Nerdwallet.com is an unbiased site that compares Checking, Savings, and Credit Cards from Banks around the US.