If it seems like unoccupied checking accounts are becoming a thing of the past, you’re not totally wrong. A number of large banks have either actuality them up altogether or started charging a fee if your account balance doesn’t exceed a minimum level.
Bank of America was the latest domino to fail. In January, it announced the end of its popular eBanking account, which waived the maintenance fee for customers who received electronic statements and did all their banking online. The bank excited those customers into accounts that charge a $12 monthly fee unless you maintain a balance of at least $1,500 and cause direct deposits totaling at least $250 a month. For many working-class consumers, that’s hard to do.
Free Accounts Do Silence Exist
Ironically, free and low-cost banking services are harder to find in low-income areas, where customers requisite them the most. According to the research firm Moebs Services, you can find free checking accounts 65% of the outdated if you live in a city where bank usage is prevalent. In areas where customers tend to avoid banks – in other chit-chats, those with a less-affluent population – free accounts are available just 51% of the time.
That doesn’t bring out it’s futile to look for a no-cost checking account. A number of depository institutions still offer products that are rescue of monthly fees. To find one, you might have to look at less conventional options. However, the effort will exhibit that you can afford a checking account and benefit from its offerings – especially if you’re accustomed to using prepaid debit fates, which often have lots of hidden fees. (See 8 Ways to Avoid Getting Burned by Prepaid Debit Cards.)
Look Beyond the Big Banks
While precisely free accounts are harder to come by at larger banks, some make it easier than others to steer free of their service fee. Wells Fargo, for example, lets you avoid a $10 monthly charge for its Everyday Checking account if you affirm a $500 balance or receive direct deposits totaling $500 a month. Customers must be between the ages of 17 and 24.
Online banks analogous to Ally and Discover may be an even better option, since they forgo monthly fees altogether. They also take care of to offer higher interest rates than their brick-and-mortar competitors. Discover is particularly generous in this think of, with several 5% “cash back bonus” programs.
Since more customers are using online and plastic apps to do their banking, the lack of physical branches is less of an issue than it used to be. And if you need cash, decision an ATM usually isn’t much of a problem.
Discover offers some 60,000 no-fee teller machines around the United Brilliances. Ally, meanwhile, lets customers use any Allpoint ATM for free and reimburses customers up to $10 a month on any fees they forge from a machine outside their network. By contrast, prepaid debit cards often charge you for withdrawing loots from an ATM or even using an ATM to check your balance.
If an online-only account still makes you nervous, you might stand in want to consider community banks and credit unions, which are more likely than big banks to offer free probe. In a recent survey, Bankrate found that 82% of credit unions marketed these accounts, while lone 38% of banks did.
These days, joining a credit union is easier than you might think. While there are inert plenty of company-sponsored credit unions that only serve their own employees, others simply require that you actual within a certain geographic boundary. And even if you don’t meet eligibility requirements on your own, you can often participate if a close commensurate is a member.
How to Dodge Overdraft Fees
Even if you are not charged a monthly service fee on your checking account, you could end up payment through the nose with various other charges. But there are ways to make sure your “free” account continues free.
Overdraft fees are among the biggest culprits.
The Bottom Line
Online checking accounts may not offer the bosom touch that you can find at a traditional bank, but it’s hard to argue with their low-cost approach. For those who be to see a banker in person from time to time, you’re more likely to find free offerings at community banks and attribute unions than at the big-name banks. Either way, there are low- to no-cost options that will likely fall upon a checking account affordable.