What matters more than the bank's name
The "best" bank is the one that matches how you actually move money, not the one with the most branches or the biggest marketing budget. A bank that charges you $15 every time you overdraft is worse than a smaller bank that doesn't, even if the first one has a branch on every corner. The real question is: what do you do with your money, and which bank charges you the least to do it?
Start by listing what you actually need. Do you deposit checks by phone? Do you need to withdraw cash three times a week? Do you keep a low balance most months? Do you send money to other people regularly? Do you travel and need ATM access everywhere? Once you know what you do, you can stop looking at marketing and start looking at fees.
Key Takeaways
- Monthly maintenance fees, overdraft fees, and ATM fees vary wildly between banks—a bank that charges $12 a month in fees costs you $144 a year for nothing.
- Online banks typically have no monthly fees and no minimum balance, but you cannot deposit cash or get a debit card instantly.
- Traditional banks charge fees but offer in-person service, cash deposit, and faster debit card issuance if you need them.
- Credit unions often have lower fees and better customer service than national banks, but membership is limited to specific groups or employers.
- The best account for you depends on your deposit method, how often you need cash, and how much you typically keep in the account.
Online banks versus traditional banks: what you actually trade
Online banks (like Ally, Charles Schwab, or Discover) typically charge zero monthly fees, have no minimum balance requirement, and pay higher interest on savings. They do this because they have no physical branches and no tellers to pay. The trade: you cannot walk in and deposit cash, you cannot get a debit card the same day, and if something goes wrong, you call or email instead of talking to someone in person.
Traditional banks (like Chase, Bank of America, or Wells Fargo) have branches where you can deposit cash, withdraw large amounts, and speak to a person. They also charge monthly fees—often $12 to $15—unless you meet conditions like keeping a minimum balance or setting up direct deposit. Some waive fees for students or seniors. If you need cash regularly or deposit checks by hand, a traditional bank may cost less in time and frustration, even with the monthly fee.
A middle ground: some traditional banks offer both online and in-person service. You pay a monthly fee but get the branch access. Whether that trade is worth it depends on how often you actually use the branch.
Credit unions: membership, fees, and when they make sense
A credit union is a member-owned bank, not a corporation. They typically charge lower fees than national banks, offer better customer service, and pay higher interest on savings. The catch: you have to be a member, and membership is limited. You might be may be able to access through your employer, your school, your union, your military service, or your geographic location. Some credit unions let you join if a family member is already a member.
To find credit unions you can join, search the CO-OP Network or Alliant Credit Union's database. If you may have access to for one, compare their checking account fees, overdraft policies, and ATM network to the banks you are considering. Many credit unions participate in shared branching networks, so you can use another credit union's branch to deposit cash even if your own credit union has no local branch.
Credit unions are often the cheapest option if you may have access to, but only if one exists near you or serves your area online. If the nearest branch is an hour away and you need to deposit cash weekly, the savings on fees may not be worth the drive.
Fees that actually cost you money
Monthly maintenance fees range from zero to $15 per month. Some banks waive them if you maintain a minimum balance (often $500 to $1,500), set up direct deposit, or use their debit card a certain number of times per month. If you cannot meet these conditions, pick a bank with no monthly fee.
Overdraft fees are charged when you spend more than you have. They typically cost $25 to $35 per overdraft, and a single purchase can trigger multiple fees if several transactions post on the same day. Some banks charge overdraft fees; others decline the transaction instead. Some let you link a savings account to cover overdrafts without a fee. If you run a tight budget, overdraft protection matters more than a low monthly fee.
ATM fees are charged when you withdraw cash from an ATM that is not owned by your bank. They typically cost $2 to $3 per withdrawal. If you withdraw cash twice a week from out-of-network ATMs, that is $400 to $600 a year. Online banks often reimburse out-of-network ATM fees, or they partner with networks like Allpoint or MoneyPass that have thousands of free ATMs. If you need cash regularly, this fee matters.
Foreign transaction fees apply if you use your debit card abroad. They typically cost 1 to 3 percent of the purchase. If you travel internationally, this fee adds up fast. Some banks waive it; others charge it on every transaction.
How to compare accounts side by side
Create a simple table with the banks you are considering and list these numbers for each:
| Fee or Feature | Bank A | Bank B | Bank C |
|---|---|---|---|
| Monthly maintenance fee | |||
| Minimum balance to waive fee | |||
| Overdraft fee | |||
| Out-of-network ATM fee | |||
| Foreign transaction fee | |||
| Can deposit cash in person | |||
| Can deposit checks by phone | |||
| Interest rate on savings |
Now multiply the monthly fee by 12 and add the fees you expect to pay based on your habits. If you withdraw cash from out-of-network ATMs twice a week, multiply the ATM fee by 104. If you overdraft once a month, multiply the overdraft fee by 12. The bank with the lowest total is the one that costs you the least.
Special accounts for specific situations
If you are under 18, many banks offer student checking accounts with no monthly fee and no minimum balance. If you are over 62, some banks offer senior accounts with waived fees. If you receive Social Security, some banks waive fees if you set up direct deposit. If you are in the military, some banks offer military-specific accounts with better terms. Ask each bank whether you may have access to for a special account before you open a regular one.
If you are unbanked or have a history of overdrafts or fraud, some banks and credit unions offer second-chance accounts. These accounts have higher fees but will accept you when mainstream banks will not. Once you have built a clean history for six months to a year, you can switch to a regular account.
What to do before you open an account
Check your ChexSystems report before you apply. ChexSystems is a database that banks use to screen applicants. If you have unpaid overdrafts, fraud, or other issues on your report, some banks will deny you. You can request a free copy of your report at www.chexsystems.com. If there is an error, dispute it before you apply.
Read the fee schedule and account agreement for any bank you are considering. Do not rely on the website summary—the full agreement is where banks hide the details. Look specifically for overdraft policies, ATM fees, and conditions that waive monthly fees. If something is unclear, call and ask.
Open the account online or in person only after you have decided. Do not let a bank employee talk you into a premium account with higher fees. The basic checking account is usually the right choice.
Frequently Asked Questions
Can I have accounts at multiple banks?
Yes. Many people keep a checking account at one bank and a savings account at another, or maintain accounts at both a traditional bank and an online bank. This gives you backup access to cash and lets you take advantage of different interest rates. Just track which account is which so you do not overdraft by mistake.
What if a bank charges me a fee I did not expect?
Call the bank and ask them to reverse it, especially if it is your first time. Many banks will remove one overdraft fee or monthly fee as a courtesy if you have been a customer for a while. If they refuse, you can switch banks—that is the only leverage you have.
Do I need a minimum balance to open an account?
Most banks require $0 to $25 to open, but some require $500 or more. Online banks typically require nothing. If you do not have much money right now, start with an online bank or a credit union that has no minimum.
How long does it take to open an account?
Online accounts usually open in minutes. In-person accounts at a traditional bank take 15 to 30 minutes. You will need a government ID and proof of address (a utility bill or lease). Your debit card arrives by mail in 7 to 10 business days, though some banks can issue a temporary card the same day.
What if I want to close my account later?
Call the bank and ask to close it. Withdraw or transfer any remaining balance, and make sure all pending transactions have cleared. Some banks charge a fee to close an account within a certain period (usually 90 days to a year), so read the agreement before you open.