How to pick the best checking account: 6 questions to ask

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You probably already have a checking account — but is it really your best option? Chances are you can find a better-suited option elsewhere.

The best checking accounts come with minimal fees, accessibility, and easy account management. By choosing the right account, you can save money, enjoy added perks, and more easily manage your finances.

Here are 6 questions to help you pick the best checking account.

1. What features do I need?

The first thing you need to do when choosing a checking account is figure out what features you need. Every checking account comes with the basic service of keeping your money safe but easily accessible. Beyond that, features can vary.

Consider what’s most important to you when it comes to banking. Some banks prioritize ATM access and a high number of physical branches. Others devote themselves to offering a high-quality online experience.

Considering your needs also helps you avoid unnecessary fees. Knowing your transaction habits lets you choose a checking account that aligns with your spending behavior. Some accounts have minimum balance requirements or charge fees for certain services. By selecting an account that suits your needs, you can avoid paying for features or services you won't use.

For example, if you're a frequent traveler, having a checking account with no foreign transaction fees and a vast ATM network can be helpful. If you’re focused on earning interest, you may want to consider an account that offers interest or the option to link it to a high-yield savings account.

2. Do I want to bank in person or online?

You can break most banks into two categories: online banks and brick-and-mortar banks.

Online banks don’t have physical locations. Instead, all banking is done online. Because these banks don’t pay to maintain a physical branch, they may offer higher interest rates.

Brick-and-mortar banks have networks of physical branches in a region or across the country. It’s often easier to deposit or withdraw cash with an in-person bank at a branch or ATM. You’ll also get more access to services like lending, investing, or commercial banking.

An online bank is ideal for those who don’t mind managing their accounts online and don’t often make cash withdrawals or deposits. In exchange, you may earn more interest on your accounts and avoid fees.

If you prefer in-person interaction, select a bank with local branches nearby. The same goes if you regularly make cash deposits or withdrawals.

3. What are the fees?

Once you’ve narrowed down your options, look at the fees different banks charge. This can help you avoid unpleasant surprises down the road.

Different banks have different fees, and specific account activities may incur charges. Common bank fees include:

• Monthly maintenance fees
• Overdraft fees
• Out-of-network ATM fees
• Insufficient funds fees
• Wire transfer fees
• Paper statement fees
• Inactivity fees

You can avoid some fees if you avoid certain actions. For example, overdraft fees and ATM fees aren't an issue if you don’t spend past your balance and only use the bank’s ATMs. Maintenance fees can be harder to avoid. Usually, you’ll have to maintain a certain balance or sign up for direct deposits to avoid these fees.

When comparing fee structures, look at the fees you’re most likely to pay. Choose a checking account with no monthly maintenance fees or fees you can easily avoid.

4. Are there minimum balance requirements?

Some checking accounts require you to always maintain a set balance to avoid fees or enjoy certain benefits.

For example, if an account has a $100 minimum balance requirement, you’ll need to deposit at least $100 to open the account. If your account balance falls below that, you’ll have to pay a regular fee until it moves back up.

Minimum balances vary between banks, from a few hundred dollars to thousands of dollars. Some banks, especially online banks, have no minimum balance requirements. Other banks may offer specific benefits — like a higher interest rate — if you maintain a certain balance.

If you typically keep a lot of money in your checking account, a minimum balance requirement may not matter. It may even be worth the added perks, like higher interest rates. But if your checking account balance fluctuates or you want more flexibility, you may opt for an account with no or low balance requirements.

5. Can I earn interest?

Most checking accounts earn no interest or at a very low rate. But some accounts — high-yield checking accounts — offer the added benefit of earning interest. These accounts help you grow your money over time, even if it's at a lower rate compared to other savings options.

To benefit from a high-yield checking account, you'll typically need to maintain a minimum balance, receive direct deposit, or perform a minimum monthly transaction amount.

If you can follow these rules, it may be worth earning a modest return on your checking funds.

6. Is there ATM access?

Having ATM access allows you to withdraw cash conveniently. ATMs are widely available and provide access to cash 24/7, even outside regular banking hours.

Most branched banks have a network of ATMs with fee-free cash withdrawals. While most online banks don’t have their ATMs, they allow you to withdraw cash from an out-of-network ATM (which may incur a fee).

You can also often deposit cash or checks through ATMs. This is a useful feature if you deposit funds frequently.

Picking the right checking account for you

Picking the right checking account is all about finding one that matches how you manage your money.

Determine how often you make transactions, whether you prefer in-person or online banking, and what type of services you use. If you use ATMs, look for an account with a wide ATM network to avoid excessive fees. If you prefer online banking, ensure the bank offers robust digital banking services.

Evaluate the fee structure of different checking accounts to avoid unnecessary charges. Look for accounts with minimal or waived fees. Review the minimum balance requirements and determine if you can maintain the required amount.

If earning interest is important, look for accounts that offer a solid interest rate. Consider any added benefits or rewards programs, such as cash back on debit card purchases or ATM fee reimbursements. These perks can add value to your banking experience.

How to open a checking account

You’ve researched banks and found the right checking account for you. Actually opening the account is a pretty straightforward process. Depending on the type of bank you choose, you can open an account online or in person at a branch.

First, gather your documents. Typically, you'll need a valid form of identification, such as a driver's license or passport, and proof of address, such as a utility bill or lease agreement.

Once your application is approved, you'll need to deposit funds into your new checking account. You can do this by transferring money from an existing account, depositing cash or a check, or setting up direct deposit. Consider setting up additional services, including online banking, mobile banking, and debit card issuance.

Before finalizing the process, understand the fees, transaction limits, and other vital details to ensure you know how the account works.

Remember to keep track of your account, review your bank statements regularly, and use the account features that align with your financial goals and spending habits.

Editorial disclaimer: Opinions expressed are author's alone, not those of any bank, credit card issuer, or other entity. This content has not been reviewed, approved, or otherwise endorsed by any of the entities included in the post.