Choosing a Bank: 5 Items to Consider
Updated: Aug 17
Choosing your bank is an important decision that can impact your financial health in the future. There are many factors to consider before selecting a bank. You’ll want to evaluate fees, rates, security, and customer support accessibility. When choosing your bank, you should select an option that suits your personal financial situation. Assess your financial needs, including the type of account you require, prior to selecting a bank. In this guide, we will address the top items to look out for.
Banking security features can help protect your money from fraud, identity theft, or bank closures. Many banks offer federal insurance through the FDIC. This means that your money (up to $250,000) is protected if your financial institution goes bankrupt. Additionally, some banks offer fraud-monitoring on debit and credit cards to protect your account from criminal activity. You should also consider security features associated with online banking. Two-factor authentication, as well as encryption can safeguard your account from hackers.
Customer service varies from bank to bank. Some institutions offer 24/7 support, while some only offer support during business hours. Consider whether you prefer support over the phone or in-person. If you prefer the latter, make sure to select a bank with a physical location that is accessible for you. Customer reviews are a helpful resource to get an idea of a bank’s customer support experience.
Bank accounts typically have a variety of fees attached to them. You may be charged an ATM fee for using an ATM from a different institution. You may incur overdraft fees if your account falls below the minimum balance. Maintenance fees are usually drawn from your account on a monthly basis. When fees add up, they can significantly impact your savings, so do your research. Keep your financial habits in mind, and select a bank with a policy that is advantageous to you. If you need a low-fee credit card, this site can help you compare options.
Check if your desired bank has minimum deposit requirements. Larger, traditional banks usually require a deposit of at least $100.00 to get started. As stated previously, you could incur fees if you dip below the threshold. Ensure that you can meet requirements to avoid a headache down the road. If you can’t, you might want to opt for an online bank where requirements are typically more relaxed.
If you’re seeking a savings account or an investment account, you should compare rates to see who will give you the highest return on your investment. Don’t neglect rewards programs like cash back on credit card purchases. While these may seem insignificant, they can provide a substantial boost to your savings over time.