Finding the right bank account seems to be very difficult. Many people have several checking and savings accounts running simultaneously with no actual benefit.
It would be better than have one efficient checking account and one efficient savings account running and then you don’t have to worry anymore about your day-to-day banking. There are two main issues you have to resolve when finding the right bank account.
Choosing a Bank Account
Banks rely on your laziness
If you have a bank account you are probably paying fees on items you have no idea what they are. Most people happily carry on paying these fees every month and banks rely on this. This is how they make a lot of money. If you are paying $10 per month in fees and there are 1 million other people like you a bank will make $120 million a year just on laziness alone. What value do you get in return? Very little probably. So, make a decision today to find the right account.
Know how you bank
- Do you visit your bank a lot or do you do a lot of online banking?
- Do you write a lot of checks or do you make mostly electronic transfers?
- How much money are you keeping in your checking account and how much are you saving?
These questions, and more, are all critical to selecting the correct bank account for you. There are accounts which offer free internet banking and penalize you for visiting a bank teller. If you hate internet banking and like visiting your bank then clearly that is the wrong account for you.
Some accounts have high fees for writing checks and low fees for electronic transfers. So if you are a check writer then that is also the wrong account for you. Don’t be dazzled by offers of a free $50 deposit into your account when you open or a free gift. They will make their money back in the first month because you haven’t got the right account for your needs.
Finding the right bank account is really that simple, make a decision to change and then find features that suit your style of banking. This will save you time and money. If you are concerned about bill payments being debited from your account automatically, many banks will sort out all the transfers for you. After all, they want your business.
To Choose a Bank or Not?
When it comes to financial institutions and resources, banks are the first thing that pop into most people’s minds. Using a bank for day-to-day financial matters may actually end up costing them money. Here is some information on some possible banking alternatives and other banking options.
Banks charge a lot of fees, in case you haven’t noticed. There are fees if you use a teller more than a certain amount of times per month. There are fees for your checks. Actually, banks have fees on just about everything. If you look closely at your bank’s checking account information, you’ll see this immediately.
Also, banks generally charge a higher rate on their financial tools such as mortgages, loans, lines of credit, and credit cards than, say, credit unions charge. Many even still charge fees for using their ATM machines.
So what other options does a person have? A credit union is one great way to break the bank habit. Credit unions are more likely to have fewer fees and charges for their services. They were, after all, the first financial institutions to offer free checking. Many times they offer a higher rate and better terms on items like CDs and IRAs. And since being deregulated in the late 1990s, anyone can become a member.
Credit unions in your area are likely to provide a high level of convenience. In all honesty, this is the chief reason most banks are so successful. There’s a bank branch or ATM machine for the heavy banking hitters on practically every corner. That’s their main attraction-convenience. To compete with banks’ convenience, most credit unions have followed suit and are likely to be easily accessible in your city. They also provide the same online benefits as large banks. Most have great ATM capabilities too.
Another possibility to consider is an online bank. While the convenience of getting quick cash may be lost, they’re a great way to manage your money. They make it super easy to pay bills online. Many of them also offer great deals on CDs, IRAs, and loans. And that makes them a good alternative to check into. There are also special online mortgage companies that give first rate mortgage rates and services.
And it is possible to have the best of all worlds. Many people have accounts in all three types of financial institutions or a combination of them. Only you can know what’s best for you. But before you choose a bank, research other options to ensure that you’re getting the best services for the best prices.
For teaching about banking please see:
Teaching Banking and Savings Accounts
Teach and learn about bank savings accounts, banks, and interest rates.
6 thoughts on “Finding the Right Bank Account — Evaluating Alternatives”
When I was young, my parents helped me open a bank account so that I could start saving money. Even 15 years later, I am still using that same bank and I didn’t realize how many fees are associated with until recently. I have been pretty lucky to avoid most of those fees, but I am ready to switch to a checking account that is actually free. I like you section about credit unions and this gives me something to look into. Thanks for the info!
It is a necessity these days to have a savings account. I would suggest looking into taking some of the money in a savings account and putting it into some sort of money-market account, like a CD. Your advice on looking to see if banks have low fees for electronic transfers is good. If you deal at all with transactions or wiring money, your bank could end up charging quite a high fee for it.
I like your comment on looking at how you bank when looking for the right account. I would imagine that if you do more online banking it would be better to find somewhere that offers many of these services. I’m looking for a new banking service so I’ll have to find one who offers services I will actually use.
Thank you for all this great information about choosing a banking service! One thing that really stood out to me is that you say to consider how much money you will be keeping there. It would be nice to know that you won’t have a limit on the amount of money.
You said that a credit union in your area will provide high convenience. If I was going to get a credit evaluation I would want to know that it was done professionally. Maybe I should contact professionals before I just decide to pick one.
I agree that considering how many checks you write can help you decide on a bank account. considering how you bank would be an important metric to have in order to ensure that you get the right type of account. In addition to this, you would want to consider what others say about the banking institution.