Banking » Guides » How To Choose the Best Checking Account
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How To Choose the Best Checking Account

Fees, mobile features, ATM network and minimum deposit are just part of the factors to consider when you choose a checking account.
Author: Baruch Mann (Silvermann)
Baruch Mann (Silvermann)

Writer, Contributor

Experience

Baruch Silvermann is a financial expert, experienced analyst, and founder of The Smart Investor, which helps consumers make better financial decisions.  Silvermann’s areas of expertise include investing, banking, and credit cards. Silvermann has contributed to Yahoo Finance and cited as an authoritative source in financial outlets like Forbes, Business Insider, CNBC Select, CNET, Bankrate, Fox Business, The Street, and more. Aside from being a finance expert, his background includes working as a business and financial analyst. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.

Review & Fact Check: Baruch Mann (Silvermann)

Baruch Mann (Silvermann)

Financial Expert, The Smart Investor CEO

Experience

Baruch Mann (Silvermann) is a financial expert and founder of The Smart Investor. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.
Author: Baruch Mann (Silvermann)
Baruch Mann (Silvermann)

Writer, Contributor

Experience

Baruch Silvermann is a financial expert, experienced analyst, and founder of The Smart Investor, which helps consumers make better financial decisions.  Silvermann’s areas of expertise include investing, banking, and credit cards. Silvermann has contributed to Yahoo Finance and cited as an authoritative source in financial outlets like Forbes, Business Insider, CNBC Select, CNET, Bankrate, Fox Business, The Street, and more. Aside from being a finance expert, his background includes working as a business and financial analyst. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.

Review & Fact Check: Baruch Mann (Silvermann)

Baruch Mann (Silvermann)

Financial Expert, The Smart Investor CEO

Experience

Baruch Mann (Silvermann) is a financial expert and founder of The Smart Investor. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.

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Table Of Content

Choosing a bank account is an important step in achieving your financial goals. Whether you want to store your funds long-term or short-term, this will help you choose the type of account that suits your goals and have the best financial institution.

Choosing the right account for you is no easy task. It could be that you're trying to figure out which type of account is best for your needs, or you're trying to figure out which account features to compare.

Checking accounts offer numerous benefits, and all of them can help you get the most out of your money, but it takes some research to choose the right account. You should compare different accounts and narrow down your preferred options. If you want to choose the best checking account, follow the guidelines listed below.

Top 11 Factors When Choosing A Bank Account

There are a million different characteristics of a bank account that you can look at to pick the best one for you. For simplicity, I’ve chosen the 10 most important factors to look at when analyzing checking accounts.

1. Bank Account Type

The first decision you need to make is what type of checking account you would like. There are a few different main types of checking accounts that each offer distinct features.

  • Basic account with rate typically in line or just below the market rate for checking accounts.
  • Has a minimum account balance and is usually tied to a debit card.
  • Meant for everyday use and regular spending
Bank/institution
Monthly Fee
Min Deposit
Promotion

capital one bank logo

Capital One 360 Checking
$0
$50
None
ally bank logo
Ally Interest Checking Account
$0
$0
None
chase bank logo
$12 Can be waived if you maintain a $1,000 minimum daily balance, making direct deposits or Associated SnapDeposits of $500 or more per statement cycle, or holding $2,500 in combined deposit accounts with the same statement cycle date or having a Health Savings Account or investment account
$0
$200 Expired on 1/25/2023
  • Offers rates above that of standard checking accounts allowing you to earn money on your balance
  • Typically has a higher account balance threshold and has limits on account balance earning a certain APY. For example, you can earn 3% on anything less than $50,000 in your account, but once it goes over this threshold, the rate drops to 1%
  • Encourages more saving to earn returns
Bank/institution
APY Savings
Monthly Fee
APY Checking
american-express-bank-logo
Amex Rewards Checking
3.30%
$0
1.00%

Sofi bank logo

SoFi Checking And Savings
3.75%
$0
3.75%
  • These accounts incentivize customers to spend with money in the account through offering perks and rewards
  • Offers rates lower than standard accounts, as the rewards allow you to earn money from the account
  • Connected to debit card that automatically gives rewards every time you spend
Bank/institution
APY Savings
Monthly Fee
Promotion

axos-bank-logo

Axos Rewards Checking
Up to 4.21%
$0
$100 Use Promo Code “RC100” for a $100 bonus when you apply for a Rewards Checking account. Expired on 3/31/2023

discover bank logo

Discover Cashback Debit
3.30%
$0
$150 / $200 Minimum deposit required: $15,000 or $25,000 within 30 days. [/sc]

2. Fees Associated With The Account

Checking accounts often come with numerous fees that penalize you for spending money in a reckless or inefficient manner.

The three primary fees that you should be looking at are the monthly maintenance fee, overdraft fee, and third-party ATM fee.

  • This is the amount you pay per month to continue having a checking account with the bank. This fee can be waived in certain instances.
  • Monthly maintenance fees are typically around $5-15 per month , but online banks and credit unions usually charge less than traditional banks.
Bank/institution
Monthly Fee
Bank Type
Bank of America Advantage Plus Checking
$12 can be waived by maintaining an account balance of $1,500, qualifying deposit of $250+ per month or enrol in Preferred Rewards
Traditional
Chase Total Checking®
$12 Can be waived if you maintain a $1,000 minimum daily balance, making direct deposits or Associated SnapDeposits of $500 or more per statement cycle, or holding $2,500 in combined deposit accounts with the same statement cycle date or having a Health Savings Account or investment account
Traditional
Citi Checking Account
$12 Can be waived if you make one qualifying direct deposit and one qualifying bill payment per statement period, maintain a combined balance of $1,500 per month across your eligible accounts or if you’re aged 62
Traditional
PNC Standard Checking
$7 per month can be waived if you maintin $500+ direct deposit per month, $500+ monthly balance in savings or age 62+
Traditional
U.S. Bank Checking
$6.95 (Easy Checking) Can be waived by maintaining an average account balance of $1,500, have $1,000+ in direct deposits per month or be aged 65+
Traditional
Wells Fargo Everyday Checking
$10 Related to Wells Fargo Everyday Checking. The fee can be waived if you maintain a minimum daily balance of $500 or receive at least $500 in qualifying direct deposits per month. The fee is also waived if you’re 17 to 24 and have a linked Wells Fargo Campus Debit Card or Campus ATM card linked to the checking account
Traditional
Capital One 360 Checking
$0
Online Only
Amex Rewards Checking
$0
Online Only
SoFi Bank
$0
Online Only
Marcus
$0
Online Only
  • This is the fee when you spend more than what you currently have in your account.
  • Overdraft fees are typically the largest of any fees, as the bank is put in the position to take a potential loss.
  • The average overdraft fee is about $30-35 but is much lower for online banks which usually charge $0.
  • If you want to withdraw money from your account in the form of cash, you will need to go to an ATM and take money out, which many banks charge a fee for when the ATM is not theirs.
  • ATM fees are typically low, with the average being $2, but these charges can quickly add up if you withdraw from your account often. I recommend taking out large amounts at a time to minimize the fees.

3. FDIC/NCUA Insurance

Ensuring the safety of your money is one of, if not the most important benefits of having a checking account. If a catastrophic financial event happens and the bank where you hold your money goes through a liquidity crunch, you may not be able to receive your money.

Make sure that your account is insured by either the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA).

Both policies protect losses up to $250,000 per account and allows you to retain your losses even if the bank goes belly-up.

4. Minimum Balance Requirements

Most banks institute a minimum balance requirement at the end of the month. Oftentimes, if this minimum balance is met, the monthly maintenance fee on the account is waived. Accounts with a low minimum balance requirement make it easy to avoid paying the monthly fee.

If you are worried about your ability to consistently meet the minimum account balance, the bank may not be right for you. Repeatedly being charged the monthly maintenance fee quickly adds up and can cancel out any benefits received by having a higher APY than other accounts.

Use your past checking account activity to monitor what you account balance is typically at, so you can decide what minimum balance requirement is acceptable for you.

Besides minimum balance, there are some more requirements for opening a bank account.

5. Accessibility Through ATMs

If you are a big fan of cash, the network of ATMs offered by the bank is an important feature of the checking account. Due to third-party ATM fees, taking money out of ATMs often can add up to a lot of extra and unnecessary charges.

However, these fees are only associated with third-party ATMs, so if you use the ones owned by the banks, you will not be charged. This is why choosing a bank with an extensive ATM network could be advantageous.

Many banks with quality checking account benefits do not have much of an ATM network, so they compensate for this by offering rebates on ATM fees. Both Fidelity and Schwab offer this feature, by giving full rebates to any customer charged an ATM fee.

If this isn’t appealing to you, Citibank has the largest network of ATMs in the US, with over 65,000 locations where Citi customers won’t be charged a fee for withdrawal.

Bank
Estimated Number of ATMs
Citi
60,000
Chase
16,000
Bank Of America
16,000
Wells Fargo
12,000
PNC Bank
10,000
U.S. Bank
5,000

6. Interest Rates

If you plan on using your checking account as not only a vehicle of spending, but also a way to earn interest on your money, the Annual Percentage Yield (APY) of your account is something you should keep an eye on.

The APY is the percent you earn per year on whatever amount you have in your account. Some accounts have a maximum amount set of cash balance where you can earn a certain APY, so keeping all your funds in one high interest account may not be beneficial.

But the most important thing to the APY you can get on the savings account your new bank offers. Maintaining both checking and savings on the same bank makes it easy to manage,  can save you time, and get you more perks. 

Bank/Institution
Savings APY
American Express
3.30%
Capital One
3.30%
Upgrade
4.13%
Marcus
3.30%
Discover Bank
3.30%
Lending Club
3.60%
Quontic
3.20%
Axos Bank
Up to 4.21%
Alliant Credit Union
2.60%
Ally Bank
3.30%
SoFi
3.75%

7. Online Banking Capabilities

If you enjoy banking at your own convenience and dislike going to the bank to handle your finances, your checking account being able to be accessed from the internet should be an important feature to look at.

Online banking saves a lot of time, allowing you to transfer, withdraw, deposit funds, and check your account status from anywhere you have an internet connection. Online banks also often offer better rates and lower fees than traditional in-person banks.

Two of the highest-rated online checking accounts are SoFi checking and savings and Capital One Checking. Both of these accounts allow customers to access their account information 24/7 from their website.

These accounts also charge no monthly maintenance fee as well as offering a high APY, with SoFi paying a 3.75% APY and Capital One paying a 3.30% APY. If online banking excellence if a primary feature you are looking for, these accounts both provide great options.

8. Promotions

Many banks offer promotions for new account holders. If you're looking for a new bank, check out the bank promotions for January 2023 – there is a good chance you can earn a couple of hundred of dollars.

Most banks offer promotions if you meet specific requirements, but in most cases, you meet them anyway. 

However, promotions are one of the less important factors on our list, and therefore it's the last one. While it's nice to get a promotion, other factors are much more significant if you want to manage your account healthily and choose the right checking account for your needs.

Bank/institution
Promotion
Min Deposit
Expiration
Axos Rewards Checking
$100
$50
3/31/2023
Chase Total Checking®
$200
$0
1/25/2023
Citi Personal Checking
$200 – $2,000
$10,000 – $300,000
1/9/2023
SoFi Checking and Savings
$50 – $250
$1,000 – $5,000
01/31/2023
Bank Of America Advantage Banking Account
$100
$1,000 or more in direct deposits within 90 days
06/30/2023
Wells Fargo Everyday Checking
$200
$1,000
12/31/2022

9. Customer Service Ratings

One of the most frustrating feelings is not being able to access your own money. With a large amount of banking being done online, a number of issues can arise that restrict your access to your account.

When such issues arise, it is imperative to get into contact with a representative from the bank to sort out the problem. Your bank having a trusted reliable customer service team gives you the peace of mind that you can access your money if something goes awry.

The banks held in the highest regard for customer service ratings offer customers 24/7 phone service if they have an issue, as well as a large network of physical locations where they can sort out problems in person.

Giving customers the choice of talking with a representative on the phone whenever they want or meeting with someone face-to-face gives customers the comfort they need when things go awry.

10. Overdraft Policy

While overdraft policy is apart of fees, I felt this was important to add on its own as overdraft fees can add up the quickest and are the heftiest of all account fees.

When a customer makes a transaction that costs more than what funds are available in their account. People who do not carefully check their balances can be blindsided with large fees at the end of each month. If you think you are more susceptible to making this mistake, find an account with a customer-friendly overdraft policy.

In an attempt to entice new customers, many banks have eliminated overdraft fees. A few of the large banks that have done this include SoFi, Axos, Ally, and Capital One. None of these banks charge overdraft fees, but they do each have their own distinct policy on how to deal with overdrafts when they occur.

Some of these policies are conditional on depositing a certain amount, so make sure you understand the overdraft fee waiving policy before you chose the account.

Bank/Institution
Overdraft Fee
Chase
$34
PNC Bank
$36
Bank of America
$10
Capital One
$0
Wells Fargo
$34
Discover
$0
Citibank
$0
US Bank
$36
TD Bank
$35

11. Mobile Banking

Going along with online banking capabilities, the mobile banking quality of an account is an important part of the customer experience. Being able to view your account and make transfers directly from your phone is a desire many customers have. Having a quality mobile banking app can drastically improve your interactions with your checking account.

There are a number of online banks that are known for having high quality mobile apps, but a few in particular stand out. The Ally mobile app is one of the highest rated mobile banking apps out there.

Customers love being able to easily separate their savings and checking accounts for certain occasions as well as seamless transfers and mobile check deposits.

The Capital One mobile app is another loved one by users as JD Power rated it the highest in customer satisfaction in 2022. Directly on the app, you can track your credit score, send money through Zelle, and compare rates of different accounts.

Bottom Line

There are many more factors you can look at when analyzing bank accounts. If you seek to get the best of every feature, you’ll be searching forever! The first step you need to take is to understand what factors are the most important for you.

Based on how you spend your money and especially if you manage multiple bank accounts, you should know what is the most important for you. Once you have these factors selected, find the accounts that are excellent in these specific features, and do the rest well enough.

It's no easy task picking a checking account, so take your time, use your resources wisely, and think everything through before you make a final decision.

Baruch Mann (Silvermann)

Baruch Mann (Silvermann)

Baruch Silvermann is a financial expert, experienced analyst, and founder of The Smart Investor, which helps consumers make better financial decisions.  Silvermann's areas of expertise include investing, banking, and credit cards. Silvermann has contributed to Yahoo Finance and cited as an authoritative source in financial outlets like Forbes, Business Insider, CNBC Select, CNET, Bankrate, Fox Business, The Street, and more. Aside from being a finance expert, his background includes working as a business and financial analyst. Above all, he is passionate about teaching people how to manage their money and helping millions on their journey to a better financial future.