Choosing a bank account is a big deal. After all, you will probably give most of your money to the institution for safekeeping. You want to make sure it's safe.
You also need to be able to access this cash for all your daily operations, such as paying bills or coughing for your share of the pizza.
In addition to selecting from multiple financial institutions, Banking will mean another important decision from 2019: Do you use one of the many purely digital online banking options or do you keep the old school by opening an account at brick-and-mortar facility?
Are online banks safe?
In a recent survey conducted by The Penny Hoarder, more than 50% of respondents said they did not consider using an online bank and more than 19% were not sure if they would use one. Given that much of our lives are being led online these days, we found this data point surprising.
On the other hand, we understand that we have reservations about money matters. When you enter a stately brick-built bench, it can be less frightening to make your hard-earned money.
Are online banks safe? The truth is that there are a growing number of online banking alternatives that are indeed legitimate and secure. Online banks such as Chime and Simple, like Bank of America and Chase, are FDIC insured for deposits up to $ 250,000.
And thanks to the magic of technology, with your money you can do just about anything you need without ever having to personally visit a cashier: deposit checks on your mobile phone, withdraw cash from an ATM on the network or transfer money to a family member or Friend. You can even issue paper checks … if you really need them.
However, it is true that you are unable to enter a bank and talk to a cashier in person. What are the other important differences between these two banking methods?
Brick-and-mortar banking: pros and cons
Since almost 72% of our respondents said they had visited a stationary bank last year, we would like to call this option. Here are the disadvantages and benefits of an old school bank that you can get into to open an account.
Traditional bank professionals
Larger banks may offer one-stop shopping for your financial needs: They often make it easy to take out a mortgage, open a credit card, or apply for a personal loan from the same bank. (However, these products may incur higher fees than you would pay to purchase from independent lenders.)
Some users find it easier to go to a bank and ask for the service they need. This may be a better option for you if you do not want to figure out how to get what you need through an online banking portal or an online banking app.
Depending on the bank you choose, you may be supporting a local (or local) business, or at least a nationwide company providing jobs in your area. In particular, credit unions are often community-focused institutions that participate in local events and provide account holders with friendly, personalized customer service.
Traditional Banking Cons
Depending on the bank selected, you may only be able to access your bank locally. This can be a problem for those who travel or at some point plan to move out of the state.
Large banks often have higher account maintenance fees and other associated costs. After all, they have to stop the light in a personal banking facility. In addition, the amount you can earn with interest income and checking accounts may be lower than what you receive from a pure digital bank.
You are probably already doing most of your banking business online. In fact, more than half of our respondents said they do most of their banking business online or through a mobile app. And in a personal bank, especially a small or local one, the online banking portal or mobile app is not quite as elegant as the technical tools you find in a bank where these tools are the main access and access method Interact with your money.
Advantages and disadvantages of online banking
What about banks that only work digitally? What incentives can they offer to outweigh the disadvantage of not having a physical location – and what other drawbacks are there?
Online banking professionals
Since they do not have as much overhead as physical institutions, online banks often offer more cost-effective banking options. Many have no monthly maintenance or account balance requirements.
With an online bank, you have your money everywhere. You are not tied to the physical location of your bank. Many online banks allow you to access your cash through a toll-free network of ATMs, not just across the country but also overseas. In addition, you always have access to the tools available on your computer and smartphone.
Some online banks and alternatives offer other financial products, such as mortgages and student loan refinancing. For example, take a look at Ally and SoFi, which also offer investment products, educational resources, and more.
Many online banks offer a range of digital tools that allow you to take control of your finances. These include built-in budget trackers, automatic savings, and integration with popular third-party apps like PayPal or Venmo. While stationary banks also use and supplement these extras, fully digital banks are usually ahead of the pack in these forward-looking extras.
Online banking Cons
No personal bank account. If you commit yourself in your own way and do not have to go through the learning curve to discover the tools of a digital bank, a stationary bank may be easier. (That is, even large chains install pimped-in ATMs and channel much of the queue to the machine rather than letting them interact with the cashiers, so in the end, you may not have a real choice!)
What to keep in mind when looking for a bank account?
Regardless of which banking option suits you best, remember that not all banks are created equal, whether they are in real space or in cyberspace. It is important to thoroughly review all features and policies of your potential bank account before you sign the documentation.
Are you looking for a new home for your money? Learn about the best checking accounts and savings accounts in the market today.
Jamie Cattanach's work has been featured on Fodor, Yahoo, SELF, The Huffington Post, The Motley Fool and other outlets. Learn more at www.jamiecattanach.com.
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