Start with what you actually use your bank for

The best bank for you is the one that handles the things you do most often without charging you for them. Before you compare banks, write down what you need: Do you deposit checks by phone? Do you need to withdraw cash three times a week? Do you send money to other people regularly? Do you keep a small balance or a large one? Do you want to talk to a human, or do you handle everything online?

Most people pick a bank because it has a branch near their house or because a friend uses it. That works fine if the bank's fees and features match how you actually move money. It fails quickly if you're paying $3 every time you use an out-of-network ATM, or if you can't deposit a check without driving to a branch.

The specific features that matter to you are the ones that will save you money or time every single month. Everything else is noise.

Key Takeaways

  • List the banking tasks you do most often—ATM withdrawals, check deposits, transfers, customer service calls—before you compare banks, because fees vary wildly by how you bank.
  • Monthly maintenance fees, overdraft fees, and ATM fees are the three places banks make money from regular customers; check what each bank charges for all three.
  • A large national bank offers more branches and ATMs but often charges higher fees; a credit union or online bank usually charges less but may have fewer physical locations.
  • Call the bank's customer service line and ask about fees before you open an account, because fee schedules change and what's posted online may not match what you're told.
  • You can move your money to a different bank later, so starting with one that seems reasonable is better than spending weeks researching the perfect one.

Compare the three fees that affect you most

Monthly maintenance fees are what the bank charges just to have an account open. Some banks charge nothing. Others charge $10 to $15 a month unless you keep a minimum balance—often $500 to $2,500—or set up direct deposit. If you can't meet the minimum, that fee comes out of your account every month whether you use the bank or not.

Overdraft fees are what the bank charges when you spend more than you have. The fee itself is usually $25 to $35 per overdraft, and some banks charge it multiple times a day. A few banks will decline the transaction instead of charging a fee. Others offer overdraft protection, which means they'll pull money from a savings account or credit line to cover the gap—sometimes for free, sometimes for a smaller fee.

ATM fees are what you pay when you withdraw cash from an ATM that doesn't belong to your bank. Out-of-network ATM fees range from $2 to $4 per withdrawal. If you use ATMs frequently, this adds up fast. Some banks reimburse out-of-network fees up to a certain amount per month. Others have large ATM networks so you rarely pay the fee at all.

Write down these three numbers for each bank you're considering. Add them up over a year based on how you actually bank. That number is what the bank will cost you.

Understand the difference between bank types

National banks like Chase, Bank of America, and Wells Fargo have thousands of branches and ATMs across the country. If you travel a lot or move frequently, that network is valuable. The trade-off is that they typically charge higher monthly fees and overdraft fees than smaller banks. They also tend to have higher minimum balance requirements.

Regional banks operate in specific parts of the country—for example, PNC in the Northeast and Midwest, or U.S. Bank in the Upper Midwest and West. They usually have fewer branches than national banks but more than a credit union. Their fees fall somewhere in the middle: higher than credit unions, lower than the largest national banks.

Credit unions are member-owned, not shareholder-owned, so they return profits to members instead of to investors. They typically charge lower monthly fees and overdraft fees than banks. The catch is that they have fewer branches and ATMs, though many credit unions belong to shared branching networks that let you use other credit unions' locations. You have to be a member to use one, which usually means living or working in a specific area or belonging to a specific group.

Online banks have no physical branches. They offer the lowest fees because they have no buildings to maintain. You deposit checks by taking a photo with your phone, and you withdraw cash at ATMs or by transferring money to another bank. If you never need to talk to someone in person, an online bank can save you significant money.

Check what happens when you need customer service

Call the bank's customer service number and ask a real question—something like "What happens if I overdraft?" or "Can I deposit a check by phone?" Listen to how long you wait, whether you reach a human or a robot, and whether the person answers your question clearly. If you hate the experience on a test call, you'll hate it when you actually need help.

Ask specifically about their hours. Some banks offer 24/7 phone support. Others are only available during business hours. If you work nights or weekends, that matters.

Also ask whether they have a physical branch near you, and what you can do there. Some banks have branches but they're only for deposits and withdrawals. Others let you sit down with someone to discuss accounts or get help with problems. If you think you'll ever want to talk to a human face-to-face, confirm that's possible before you open an account.

Look at what the bank offers beyond basic checking

Most banks offer a savings account alongside checking. Compare the interest rate they pay on savings—it varies from nearly zero to around 4 or 5 percent at online banks, depending on the current market. If you're saving money, that rate matters. A savings account at an online bank earning 4 percent will grow faster than one at a national bank earning 0.01 percent.

Some banks offer tools to help you budget or track spending. Some let you set up automatic transfers to savings on payday. Some offer overdraft protection or allow you to link multiple accounts. None of these are essential, but if one matches how you want to manage money, it's a bonus.

Don't let these extras drive your decision, though. A bank with great budgeting tools but $35 overdraft fees is still expensive.

Test the bank's website and app before you commit

Most banks let you look around their website and app without opening an account. Spend 10 minutes trying to find information: Can you see what fees you'd pay? Can you find the interest rate on savings? Can you figure out how to deposit a check or transfer money? If the website is confusing or the information is buried, that's a sign the bank doesn't prioritize making things easy for customers.

Download the app if you'll use it regularly. Try logging in, moving money between accounts, and checking your balance. Does it work smoothly? Does it crash? Is it fast? You'll use this app dozens of times a month, so it should feel natural to you.

Make your choice and move on

You don't need to find the perfect bank. You need to find one that costs you less than your current bank and doesn't frustrate you when you use it. Open an account, set up direct deposit if you have it, and move your money over. You can always switch later if this bank doesn't work out.

If you're switching from another bank, ask your new bank about their process for moving automatic payments and deposits. Some banks have tools to help you redirect these. Others require you to update them yourself. Either way, it takes a few days to a week, so plan ahead if you're switching around payday.

Frequently Asked Questions

Does it matter which bank I choose if I barely use it?

Yes, because even a small monthly fee adds up. If you keep $100 in checking and never touch it, a $12 annual maintenance fee is 12 percent of your balance. An online bank with no monthly fee costs you nothing. The less you use an account, the more important it is that the bank doesn't charge you just to have it open.

What if I want to use multiple banks?

Many people keep a checking account at one bank and a savings account at an online bank that pays higher interest. You can also keep a second checking account for a specific purpose—like a side business or shared household expenses. Just track which fees apply to each account and make sure you're not paying maintenance fees on accounts you're not using.

Can I switch banks without losing money?

Yes. Your money stays yours the entire time. When you move to a new bank, you transfer your balance, set up direct deposit at the new place, and update any automatic payments. The old account closes once you've moved everything. There's no penalty for switching, though it takes a few days for transfers to clear.

What if my bank starts charging fees I didn't know about?

Banks do change their fees, and they're required to notify you in advance—usually 30 days. If you get a notice about a new fee you don't want to pay, you can close the account and move to a different bank. You're not locked in.

Is a credit union better than a bank?

Credit unions usually charge lower fees and pay higher interest on savings. The trade-off is fewer locations and ATMs. If you can access a credit union and you rarely need a physical branch, a credit union is often the cheaper choice. If you need lots of branches or ATMs, a bank might be more convenient even if it costs more.