Best Checking Account: How to Choose the Best Option

Checking accounts are generally simple financial products used for using and spending money. In some instances, they may be used as investment tools, although they offer generally lower rates than other vehicles, such as savings accounts and CDs. Such money management activities require people to shop for the best checking account options available.

As a result of the competition posed by a number of different financial institutions, it is today difficult to identify one specific bank as providing the best checking account. Credit unions may be more generous with customers because they pay fewer taxes than traditional banks. It is a mistake, however, to simply opt for an institution located close to home or connected to one’s community. Convenience can come with a cost, as banks with numerous branches often spend more on rent and operations than those without.

Generally speaking, the best checking account is one that pays the highest interferes rate and charges the lowest access fees. This is increasingly a bank without branches that instead asks customers to call or use its website for assistance in managing accounts. Internet banks unfortunately require customers to mail checks with a deposit slip, which can take up to one week for deposits to post. This is an ideal option, however, for those with direct deposit paychecks. In addition to Internet banks, credit unions also tend to offer the best interest rates on personal checking accounts.

Factors to consider when evaluating checking account fees include those for ATM usage. Any bank without physical branches will not have many ATM machines, and customers are thus likely to get charged a fee from a visiting bank. This is likely to be as high as $2 or $3 per transaction. While Internet banks often reimburse customers for these fees, brick-and-mortar institutions likely will not.

Account minimum fees come into play with these scenarios as well. Many banks charge a monthly fee if a customer’s balance falls below a certain minimum. Overdraft fees are also likely. Banks often allow customers to overdraw their accounts and then charge a fee for such activity. This can be as high as $35 per transaction, and most banks sign customers up automatically for the overdraft service without asking.

In short, the best checking account can be difficult to locate, but it is out there. Customers need to simply ask about all fees associated with an account and find the highest rate of interest possible. This will not only help manage money, but hopefully put a little back into the account as well.


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