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How to Choose a Bank: From Someone Who's Been There, Tried That

Updated
Brooklyn Sprunger
Author: Brooklyn Sprunger
Brooklyn Sprunger
Brooklyn Sprunger
Content Manager

Brooklyn Sprunger is a full-time Content Manager and Personal Finance Writer at Motley Fool Money, where she oversees product reviews and ratings while also writing about credit cards, bank accounts, investing, auto insurance, and other personal finance topics. She has worked in financial content since 2018, including more than four years at The Motley Fool. When she’s not writing or editing, Brooklyn is likely hiking and watching the Tennessee Vols.

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Many or all of the products here are from our partners that compensate us. It’s how we make money. But our editorial integrity ensures that our product ratings are not influenced by compensation. APY = Annual Percentage Yield.

Choosing a bank can feel overwhelming. They all kind of blend together, right? But the truth is, it's less about the brand name and more about what fits your life. Picking the right bank is about knowing what matters most to you -- whether that's low fees, easy access, or better interest rates.

I've been through a few types myself. Growing up, I banked with a local credit union -- loved the personal touch and low fees. Then I switched to Chase because of convenience and all the branch locations. Now, I mostly use LendingClub, an online-only bank, because of the higher savings rates and fewer fees. Different stages, different needs.

Below, I'll walk you through how to find a bank that fits your needs.

Step 1: Figure out what kind of bank fits your style

Banks come in all shapes and sizes. Here are the main types, each with their own vibe:

  • Online banks: No physical branches, just apps and websites. Usually better rates and lower fees, but cash access can be trickier.
  • Regional or local banks: Smaller footprint but more personal service. Great if you like talking to a teller face to face.
  • Big national banks: Tons of locations and services, but can feel impersonal and sometimes hit you with extra fees.
  • Credit unions: Member-owned and nonprofit. Often friendlier with better rates -- but you might need to qualify for membership.

Pick the type that fits how you like to bank. If you're comfortable doing everything on your phone and want high interest, online banks usually win. If you want in-person help and easy ATM access, regional banks or credit unions might be better.

Keep reading: A Beginner's Guide to Opening and Managing Your Account

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Step 2: Think about how you'll actually use the account

Ask yourself: What will I do most with this bank? Are you:

  • Getting direct deposits like paychecks or government benefits?
  • Using ATMs often for cash withdrawals?
  • Paying bills online regularly?
  • Saving money and wanting a decent interest rate?
  • Looking for perks like budgeting tools or rewards on your debit card?

Knowing what you need helps you zero in on accounts designed for your habits. For example, some banks waive fees if you have direct deposit, and others refund ATM fees when you travel.

Step 3: Shop around for account features that matter to you

Not all checking or savings accounts are created equal. Look for:

  • Fees: Monthly fees, overdraft fees, ATM fees -- these can quietly drain your balance.
  • Minimum balance requirements: Some accounts ask for a lot to avoid fees; others don't.
  • Interest rates: Especially for savings accounts, a higher APY means your money grows faster.
  • Extra perks: Overdraft protection, cash back on debit cards, budgeting tools, early direct deposit, or fee-free cashier's checks.

Compare the fine print. The best accounts fit your goals and save you money.

Step 4: Confirm the bank is insured and safe

This one's non-negotiable: The safest banks are FDIC insured (or NCUA insured if it's a credit union). This insurance protects your deposits up to $250,000 if the bank fails.

It's easy to check for FDIC insurance on the official FDIC website. Credit unions have similar protections via the NCUA.

Step 5: Check the mobile app and online banking experience

If you're banking digitally (and most of us are), a slick app can make a big difference. Can you:

  • Deposit checks with your phone?
  • Transfer money easily?
  • Get alerts for suspicious activity?
  • Chat with customer service in the app?

Read reviews on the App Store or Google Play to get a feel for real user experiences. A frustrating app can make banking annoying, so this is worth a few minutes of research.

Step 6: Decide, apply, and get started

Once you've done your homework, pick the bank and account that match your priorities. Most banks let you apply online and fund your account with a transfer or deposit.

Decide if you want a personal account, joint account, or a business account, then follow their instructions. From there, set up direct deposit, link any apps you use, and start managing your money.

Final thoughts

Choosing a bank isn't a forever commitment. If your bank doesn't work out, you can switch. But starting with a clear idea of what you want -- and doing a little research -- makes a huge difference.

You don't have to chase the flashiest perks or the biggest bank. Pick the one that fits your money habits and makes banking feel easy. Then, keep an eye on your account and fees, and you're good.

Our favorite banks offer some of the highest savings rates out there. Check out our best high-yield savings accounts for the top picks that help your money grow faster -- without the hassle.

FAQs

  • Check that the bank is FDIC insured (or NCUA insured for credit unions). This protects your deposits up to $250,000 if the bank fails.

  • It depends on your needs. Local banks and credit unions offer personal service and easy ATM access, while online banks usually offer better rates and lower fees.

  • Look for monthly maintenance fees, overdraft fees, ATM fees, and paper statement fees. Many banks waive fees if you meet certain requirements.

  • Absolutely! You can open different accounts for different purposes, like a high-yield savings account at one bank and a checking account at another.