Choosing a online bank may not be the most important decision of your life. But choosing a bank that best suits your needs can make it easier to manage your finances – and it can save you money. Because you have a relationship with a bank that should be mutually beneficial, you do have the right to demand a little more from your financial institution. If your bank doesn’t, you can move your money. Here are 10 things you should look for in a bank:
1. FDIC Insurance
You want to make sure your money is safe. Currently, the Federal Deposit Insurance Corporation guarantees money in deposit accounts up to $250,000. (On January 1, 2014, if nothing changes, that amount drops to $100,000.) This means that if your bank fails, you’ll get your money. Regardless, it’s a good idea to check on the health of your bank, because in some cases it can take weeks to straighten things out after a bank failure. So you will get your money, but it may be some time before you can access it. If you use a credit union, the NCUA provides protection similar to that of the FDIC.
2. Reasonable fees
Find out what fees the online bank charges. Some banks refund ATM fees, and others just charge you every time you do something. Find out about monthly maintenance fees and other fees your bank may charge. Look for a financial institution that charges little to no fees. For example, a small ATM fee may be reasonable, but it is rarely reasonable for a bank to charge maintenance fees. Look for a bank that charges low fees, and doesn’t pile them on.
3. Low minimum requirements
Look for a financial institution whose minimum requirements are fairly low. Some bank accounts charge fees if you fall below a certain minimum. While this is reasonable for a money market account, a standard checking account should not have a minimum deposit requirement. Look around until you find a financial institution that offers a range of accounts with no minimum requirements.
4. Customer Service
Don’t underestimate the importance of good customer service. You want to feel somewhat valued by your financial institution. Are the tellers friendly? Can you make an appointment with the bank manager? Look for a bank that makes an effort to meet your needs in a timely manner. Also, check out the online bank’s website and phone services to see if they are convenient and easy to use.
5. Accessible ATMs
You want to have access to your money in most places. Think about where you are likely to need an ATM and try to find a financial institution that offers this access. However, this does not mean that you have to be with a national bank chain to access your money everywhere. Many community banks and credit unions are part of cooperatives that use a network to give you free access to your money through ATMs in that network. See what kind of network you can tap into to use ATMs.
6. Online banking
Having access to your account information whenever you want, along with the ability to manage your transactions and schedule transfers, is a huge benefit. Find out if your bank offers online banking and if there are any fees involved. Most banks today understand the need for online banking and offer it for free. You can also find out if your bank offers mobile banking, so you can use your phone to access your account. If convenience is important to you, online and mobile banking are a must.
7. High-yield options
You want more for your money, so looking for a online bank that offers high-yield accounts is a good idea. Look at savings account options, and find out if there are special savings accounts with better returns. You can also ask about interest-bearing checking accounts, and consider CDs. In some cases, local banks offer very competitive rates, so it may be worth looking close to home when considering your banking options. In some cases, it may be worth considering online banks for some accounts because you can get higher returns.
8. Low interest loan options
While you don’t have to take out a loan at your primary banking institution, it can still be reassuring to know that your online bank offers competitive loan rates. Look for programs related to mortgages and auto loans. Also, do research on the personal loans offered by potential banks. This can help you determine whether or not the bank offers special programs and lower rates for its customers.
9. Linked Accounts
You can greatly increase the convenience of your banking if you link accounts. Find out if it is possible to link your savings account to your checking account. In some cases, this can help you in an overdraft situation. You may have to pay between $5 and $15 transfer fees, but that is usually better than between $25 and $40 overdraft fees. Linked accounts can also make it easier to make credit card payments and set up automatic transfers, so you can easily transfer money from your checking account to your savings account.
10. Additional products and services
Finally, look for a online bank that offers the products and services you want. Think about any additional needs you may have, such as business banking or retirement planning. Research the offerings and decide if the bank meets your needs. You can simplify your finances by having more accounts in the same place. Of course, this doesn’t mean you should settle for an inferior financial product just because it’s at your primary financial institution. Look around for individual accounts and services to get the best results.