Essential Factors to Consider Before Choosing an Online Checking Account
Discover critical factors to assess before opening an online checking account, including interest rates, fees, security, and deposit options. Learn about top banks and potential challenges to make an informed decision for hassle-free banking from home.
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Key Considerations Before Opening Your Online Checking Account
Important questions to ask before selecting an online checking bank account
Are frequent trips to a physical bank branch inconvenient for you? Many people prefer managing their finances from home through online accounts. Online checking and savings accounts offer quick, secure access to transactions with just a few clicks. However, before opening an online checking account, it's crucial to evaluate certain factors. The following questions and insights will guide you in choosing an account that provides seamless access and meets your needs.
How do you pick the ideal online checking bank account?
Consider these aspects to identify the best online checking or savings account:
Interest rates and rewards – Seek banks offering high interest rates and rewards for each transaction. Online banks tend to have lower operating costs, enabling them to offer better rates.
Fees and charges – Opt for banks that have minimal or no monthly maintenance, overdraft, ATM, or wire transfer fees.
FDIC insurance – Ensure the bank is insured by the Federal Deposit Insurance Corporation (FDIC), safeguarding your deposits if the bank faces insolvency.
Ease of deposits – Look for banks offering convenient deposit methods, such as mobile check deposits through an app, and low transaction fees. Features that facilitate quick and simple deposits make managing your account more straightforward.
Top online checking accounts of 2018
Some prominent options to consider include:
Ally Bank – Known for competitive interest rates and a user-friendly digital experience. It provides ATM fee rebates of up to $10 monthly for out-of-network ATMs, along with easy online transfer options.
Discover Bank – Celebrated for its cashback rewards on online purchases and debit card transactions, with potential annual earning of up to $360.
Capital One 360 – Offers no monthly maintenance fees and access to over 39,000 fee-free ATMs nationwide, making it a top choice for online checking.
Common challenges when opening online checking accounts
Age restrictions – Minors under 18 usually need a parent or guardian to open an account at a branch, as online account opening may not be available for underage applicants.
Credit history – A lack of credit history can require visiting a branch with valid ID for verification. Banks often check credit before account approval.
Citizenship status – Permanent residents might need to visit a branch to verify documentation, whereas citizens can often open accounts online more easily.
Drawbacks of online checking accounts
Security concerns – Trusting online services with large sums raises risks like identity theft. It’s essential to select secure, reputable banks.
Technical issues – Downtime or connectivity problems can hinder quick access to your account, especially during urgent transactions.
Deposit challenges – Some banks may require in-person visits for deposits if mobile or online deposit options are unavailable, which can be inconvenient.
