I second credit unions. I’ve been with mine for years, and I love it. However, something major to consider is if you want a big national bank, such as BofA, or if you don’t mind having a smaller, more local bank or credit union. I’ve generally found I like working with the smaller banks better because it’s easier to get ahold if someone if there’s an issue, but if you travel often and feel like you need/want the convenience of a large bank, that’s something to consider too.
Here are some things to look for from a bank/credit union. Not ALL credit unions are automatically better than banks, so keep the following in mind. You should be able to find all of this information on a bank/credit union’s website. If not, I’d call the bank and ask.
-Is there a minimum balance? If there is, are there ways to get around it? For instance, some banks forgo the minimum balance if you have certain features, such as direct deposit over a certain dollar amount, or using a debit card X times in a month. In that case, the minimum balance isn’t really a big deal. Always be sure to explicitly ask the banker if those features exist, because I’ve found sometimes they aren’t very forthcoming with that information.
-Do they charge you to have a debit card? You should never have to pay to have a debit card, but some banks are starting to tack on a small fee each month if you have one.
-Does your bank/CU charge you if you use your debit card over X times in a month? Again, some banks do, and this shouldn’t be something you should be charged for.
-What is the minimum balance on a savings account? My credit union has a minimum balance of $5, but some banks have minimum balances of $100 or even $500. Something to consider.
-Online Banking should always be free. Do NOT pay for it! Again, some banks charge for this. Total rip off. The exception is if you have a business account; many banks do charge a small fee for this if you have a business account, but I still think it’s kind of a rip off.
-Are you able to set up overdraft protection for free? Again, something you may never need, but a nice feature to have just in case. If you are super responsible and don’t feel like you will ever need it, do not pay for this feature. Some banks will charge you monthly to have it. Some banks will only charge you if you use it (say $10/transfer, which is theoretically better than an overdraft).
-If you are someone who overdrafts even occasionally, what are the bank’s fees? Some banks charge $25/overdraft, and some charge $40.
-How long after I deposit a check is it available? Direct deposit should always be available for you to use immediately. If you are depositing a physical check, some banks hold the funds for one business day, and some hold them anywhere from 3-5 business days. Business days are Monday-Friday, not counting holidays. So, those funds are in your account, but you get charged if you use them before they’re available. If you are living paycheck to paycheck, this is a big deal.
-If you use ATM’s frequently, do they charge you to do an ATM withdrawal at a competitor’s ATM? You might get sacked with a fee from your bank AND from the competitor. HOWEVER, this one isn’t that big of a deal as long as you aren’t charged for your regular debit transactions. I always advise people to simply go to a store and buy something small, like a pack of gum, and get cash back. That way you avoid the fee.
I know that looking for banks and comparing features can be confusing. I used to be in banking, so I’m pretty familiar with what is standard. Feel free to PM me if you have any more questions.