How to Choose a Bank and What to Look For in One
Are you wondering how to choose a bank and what to look for in an account? Read this guide for tips on selecting the best options.
Around 7.1 million people still don’t have a bank account. That’s a lot of unbanked people, and you might be one of them.
Whether or not you have a bank, you might want a new bank account. Fortunately, you can choose from thousands of banks when you’re ready to open an account.
However, you might have questions about choosing one. So if you’re wondering how to choose a bank, we’ve got you covered.
Here are the primary things you should look for as you search for the right bank.
One factor you might want to begin with is the location. A bank’s location matters if you want to use a facility that you can visit.
For example, do you want to stop by the bank to deposit or withdraw money? If so, you’ll need a bank with a physical building nearby. You might want to find one within a specific mileage radius from your home.
Many people don’t care about physical locations anymore. Instead, they handle all the banking matters online through electronic options.
You can decide which is right for you. So if you decide that you want to visit a physical bank, you can determine how far you’re willing to travel as you search for a bank.
On the other hand, if you choose to use an online bank, you can look for banks anywhere.
Make Sure the Bank Is FDIC-Insured
Another key factor in choosing a bank is finding one that offers FDIC insurance. Banks advertise that they’re FDIC-insured, so this is easy to spot as you browse through your options.
FDIC insurance protects you. If the banks go out of business, you won’t lose your money. However, the FDIC has limits on this coverage, which change annually. As of 2022, the amount is $250,000 per depositor.
If you have more money in the bank than this amount, you’ll only lose the amount above the limit.
Most traditional bank accounts have FDIC insurance. But, of course, you can also find bank accounts that don’t have it.
Consider the Products They Offer vs. What You Want
One of the most important factors when choosing a bank is considering the products and services they offer versus what you want. So, you can start by evaluating the account type you need.
For example, are you looking for the best kid’s bank account? Or, maybe you need the best bank for a business account.
Banks generally offer multiple types of bank accounts, but you’ll need to limit your search to a bank that offers the kind you need. Therefore, you might want to review the types a bank offers before picking a bank.
The most common types of accounts are savings accounts and checking accounts. You can generally get these for personal use or business purposes.
If you’re looking for a loan, you might want to find a bank that offers installment loans, such as car loans and mortgages. If you need to borrow money from your home’s equity, you’ll need a home equity loan.
Evaluate the Fees
Next, you should evaluate the fees the bank charges for their accounts. If you want to avoid paying fees, you might want to stick with free bank accounts.
Many banks provide free accounts, but the accounts might have stipulations. For example, some banks offer free accounts with minimum balance requirements. To avoid paying fees, you’d need to keep a certain balance.
You can also review their fee structures for other things, such as insufficient fund charges and money orders.
Additionally, you might want to ask about the fees for loans. For example, how much on average does it cost to get a mortgage? You can compare the average costs of several banks to find the one with the lowest rates.
Determine if They Offer Local ATMs
Another question to ask is about their ATMs. This question is especially important if you choose an online bank, but it’s also important for local banks.
If you open a new account, they might offer a debit card. You can use this debit card for purchases, but you can also use it at ATMs to withdraw cash when you need it.
Unfortunately, most ATMs are for specific banks, which means people pay fees to use them if they don’t have an account with certain banks.
If you want to avoid ATM fees, you’ll need to use your debit card in your bank’s machines. If you plan on using your debit card for cash withdrawals, you should find out which ATMs you can use for free in your area.
Ask About Their Mobile Services
Another vital thing to evaluate is the bank’s mobile services. Most people use mobile banking services for their convenience. After all, it allows you to check your balance whenever you want.
You can also use it to deposit checks, pay bills, and transfer money. Most banks offer mobile apps, but mobile apps might not let you do everything you want.
Therefore, you should research a bank’s mobile services before choosing them. Naturally, you’ll want to find one that offers the services you need. You may also want a bank with a high-quality mobile app.
You can check a bank’s website to learn more about the mobile services. You can also contact a bank to ask questions.
It’s also interesting to know that 89% of all bank account holders use mobile banking services. Therefore, it’s extremely popular.
Learn How to Choose a Bank Before Selecting One
After reading these tips, you should know how to choose a bank now. Having a bank account is important, especially if you like handling your financial matters electronically.
You can check out our website if you’d like to learn more about our services. At ParkeBank, we offer various banking services and can help you choose the right account for your needs.