What to look for in a Bank
On a daily basis you probably drive past 5-6 banks, if not more. While surfing the web you probably see an equal number of banner ads for banks advertising CDs or accounts. Which is right for you?
Banking has certainly changed over the last 15 years and that is obvious. Competition from online (internet banks) has forced regular banks to re-evaluate the services they provide. There are several things to consider when selecting a bank.
One of the big things that are important is the fees they charge. For example, 10 years ago, if your bank had internet banking (the ability to access your account and perform basic transactions over the internet), there was probably a monthly charge for that service. Today it is rare to be charged for internet banking because so most banks offer this for free. If your bank is charging you for internet banking, it may be time to evaluate your decision to stick with them.
Another important service banks usually offer is bill pay service. Bill pay is the ability to pay your bill to the company you owe over the internet. Most banks have a relationship with a bill pay service that electronically pays companies like credit card companies, department stores, utility providers, etc. Usually there is no paper transaction involved. Bill pay is usually free from most banks, at least a predetermined number of payments per month. For example, you might be allowed to pay 10 free bills a month and anything above that is charged a fee. If you use bill pay, and are getting charged for it, it may be time to shop around for another bank.
Other factors to consider are services and rates. Many online banks offer bigger advantages in terms of fees and rates because they do not have the overhead of regular banks. They are not paying rent and the overhead associated with a lot of branch buildings. Many may offer free checks if you have a checking account or a favorable rate on a checking account if you keep a minimum balance. Also many online banks make it easy to link other accounts so you can transfer money around fairly easily between accounts. If you choose an online bank, please make sure it is FDIC insured.
When choosing a bank, you are the person who ultimately decides which bank meets your needs. For me, it is a combination of an internet bank and a local bank. There is still value in being able to walk into a bank and deposit a check or cash a check. So I have my paycheck deposited to an internet bank that pays interest on the account, offers a free unlimited bill pay service, and reimburses me each month for any ATM fees I incur from using another bank’s ATMs. I keep a free checking account at a bank about a mile from my office. I keep around $500 in the account. It pays no interest but they are friendly and courteous and know me by name. I can walk in and cash a check, use a notary public service, or get free ice cream on Fridays during the summer. It would be hard to do that at a bank that had no branches.
On a daily basis you probably drive past 5-6 banks, if not more. While surfing the web you probably see an equal number of banner ads for banks advertising CDs or accounts. Which is right for you?
Banking has certainly changed over the last 15 years and that is obvious. Competition from online (internet banks) has forced regular banks to re-evaluate the services they provide. There are several things to consider when selecting a bank.
One of the big things that are important is the fees they charge. For example, 10 years ago, if your bank had internet banking (the ability to access your account and perform basic transactions over the internet), there was probably a monthly charge for that service. Today it is rare to be charged for internet banking because so most banks offer this for free. If your bank is charging you for internet banking, it may be time to evaluate your decision to stick with them.
Another important service banks usually offer is bill pay service. Bill pay is the ability to pay your bill to the company you owe over the internet. Most banks have a relationship with a bill pay service that electronically pays companies like credit card companies, department stores, utility providers, etc. Usually there is no paper transaction involved. Bill pay is usually free from most banks, at least a predetermined number of payments per month. For example, you might be allowed to pay 10 free bills a month and anything above that is charged a fee. If you use bill pay, and are getting charged for it, it may be time to shop around for another bank.
Other factors to consider are services and rates. Many online banks offer bigger advantages in terms of fees and rates because they do not have the overhead of regular banks. They are not paying rent and the overhead associated with a lot of branch buildings. Many may offer free checks if you have a checking account or a favorable rate on a checking account if you keep a minimum balance. Also many online banks make it easy to link other accounts so you can transfer money around fairly easily between accounts. If you choose an online bank, please make sure it is FDIC insured.
When choosing a bank, you are the person who ultimately decides which bank meets your needs. For me, it is a combination of an internet bank and a local bank. There is still value in being able to walk into a bank and deposit a check or cash a check. So I have my paycheck deposited to an internet bank that pays interest on the account, offers a free unlimited bill pay service, and reimburses me each month for any ATM fees I incur from using another bank’s ATMs. I keep a free checking account at a bank about a mile from my office. I keep around $500 in the account. It pays no interest but they are friendly and courteous and know me by name. I can walk in and cash a check, use a notary public service, or get free ice cream on Fridays during the summer. It would be hard to do that at a bank that had no branches.