Chances are you’re with the same bank where your parent’s bank, and they opened up your first account with big dreams of you becoming a doctor or lawyer and filling it with millions of dollars. If you’re reading this blog, chances are that didn’t happen. No worries, you can still save a few bucks by shopping around for a bank that doesn’t take advantage of you like a creepy nightclub promoter with an underage model.
Look for the following features when shopping for a new bank:
FDIC Insured: This insurance covers your deposits for up to $250,000 should the institution fail. This is especially important if it is a newer or smaller institution.
Fees and Minimum Balance: The average monthly fee on checking accounts rose 25% to $5.48 this year, and the average balance to avoid this fee is $723, up 23% from last year. Your checking account should have zero transaction fees and should not require a minimum balance.
Interest Rate: Most big banks offer an interest rate somewhere around 0.01%. Online banks like ING and ALLY offer high yield checking accounts for about 1%. It doesn’t sound like much, but it adds up. This is especially important you have a more substantial amount of money in the account.
Online Banking/Apps: Since many banks will charge you a fee to do transactions with tellers, easy online banking is important. You should also make it a habit of checking in on your accounts at least once a week to make sure there isn’t any suspicious activity and to monitor your spending. This was especially helpful that time some jerk in New Jersey thought it would be cute to spend money on my card at Best Buy. I hope whatever he bought sucked…and then broke….and then caught on fire and burned down his house.
Here is CNN money’s list of the ‘8 least evil banks’
I personally keep my checking account with Bank of America because of their great online banking and numerous locations in NYC – I have their eBanking account that features no monthly maintenance fee and no minimum balance requirements if you do your banking through the atm’s and online. I do not make any interest on this account, so once my checking account begins to accumulate a little extra cash, I transfer it to my ING checking account where I’m currently earning 1% (rates are disgustingly low right now – this is actually a high rate). This way, not only do I earn a little extra cash from interest, but also the money is out of sight and out of mind and I can’t spend it at the barney’s warehouse sale.
Many banks also offer great bonuses for new account holders that you can take advantage of, since they know changing banks can be a bit of a hassle. Speaking of which, when you do change, don’t forget to cancel and re-establish your direct deposits and automatic bill payments.
To compare your bank’s savings and checking account interest rates check with Google’s advisor at https://www.google.com/advisor/ussavings
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