Finance
Fact Checked

How do I Choose the Best Online Bank Account?

Haven Esme
Haven Esme

Increasingly, individuals are choosing online bank accounts to provide them with checking and savings accounts to better manage their finances. There are numerous online bank accounts available. People must be careful to choose a banking institution that will cater to their personal and financial needs.

The first sign of a reputable bank is a user-friendly banking platform. The easier the banking process is, the better. An online bank account should be something that is convenient and simple.

Online banks are increasingly replacing local banks due to convenience.
Online banks are increasingly replacing local banks due to convenience.

One very important aspect to consider when choosing an online banking institution is to ensure that the bank is FDIC insured if possible. It's essential to know that only banks in the United States are covered by federal insurance, however, some international banks with US banking subsidiaries are also covered. There is always the possibility of a potential bank failure. Choosing a bank that is FDIC insured allows a person the comfort of knowing that their money won’t be lost if the bank fails.

Banking transactions may be processed through the Internet via online banking.
Banking transactions may be processed through the Internet via online banking.

Another factor that an individual may want to consider when choosing the best online bank account includes the fees that the bank charges. There are a few banks that do not charge any fees whatsoever, while other banks may have numerous fees attached to the account. Some common fees to look for include balance fees, transfer fees, ATM fees, annual fees, and overdraft fees.

When selecting an online bank, check to ensure that the banking institution is FDIC insured.
When selecting an online bank, check to ensure that the banking institution is FDIC insured.

In addition to fees, individuals should also take a look at the online bank account's interest rates. Some banks simply offer more competitive rates than other banking institutions. This is especially useful for an individual that is looking for the best online savings or money market accounts. People work very hard for their money, and it isn't unreasonable to expect a favorable return.

Many online banks will mail payments to creditors so customers don't have to mail paper checks.
Many online banks will mail payments to creditors so customers don't have to mail paper checks.

Brick-and-mortar locations that can be easily accessed should also be taken into account. Banks with a broad geographic presence are more desirable in cases where the institution’s online banking is not accessible. When choosing a bank account, an individual should determine whether or not the bank has a physical location near their home.

One final consideration that a person who's looking for the best online bank account should think about is whether or not the bank has minimum balance requirements. This is especially true for individuals that do not have a lot of money to put into the bank. Some banks will charge fees unless a certain amount of money is kept in the accounts.

You might also Like

Discuss this Article

Post your comments
Login:
Forgot password?
Register:
    • Online banks are increasingly replacing local banks due to convenience.
      By: Pefkos
      Online banks are increasingly replacing local banks due to convenience.
    • Banking transactions may be processed through the Internet via online banking.
      By: bloomua
      Banking transactions may be processed through the Internet via online banking.
    • When selecting an online bank, check to ensure that the banking institution is FDIC insured.
      By: DragonImages
      When selecting an online bank, check to ensure that the banking institution is FDIC insured.
    • Many online banks will mail payments to creditors so customers don't have to mail paper checks.
      By: oneblink1
      Many online banks will mail payments to creditors so customers don't have to mail paper checks.
    • Look for online banks that invest in user-friendly software and applications to make online transactions easy.
      By: tashka2000
      Look for online banks that invest in user-friendly software and applications to make online transactions easy.