Want Free Checking? Ditch the Big Banks
Big banks are axing free checking, but consumers can still find value at non-traditional institutions
Is there such thing as free checking anymore? Well, that all depends on how you define "free."
An increasing number of big banks such as
Technically free? Yes. But what happens if customers don't meet the conditions? Well, then they'll have to pony up cash for monthly fees that could be in the
But just because the banking industry heavyweights are phasing out affordable checking doesn't mean your only choice is to start stashing your cash under your mattress. A host of other banking options exist for consumers if they're wiling to break ties with the big banks, experts say.
"Free checking will certainly exist, but no longer at big banks," says
"Elsewhere" is credit unions, community banks, and online banking institutions, Wei and O'Malley say, all of which are expected to see tremendous growth over the next decade.
Nine of the top 10 credit unions with open membership ranked by NerdWallet offered free checking according to Wei. Online institutions, which don't have costly branches or other related overhead costs, can pass savings along to consumers, in some cases actually paying customers to use their checking accounts instead of charging them.
"Online institutions have far lower costs," O'Malley says, adding that banks spend nearly
But making the jump to completely online banking might be daunting to some Americans, who might be used to the convenience of nationwide locations and accessible ATMs. Nevertheless, more Americans are coming around to the idea of banking with smaller banks or online institutions, O'Malley says.
"Remember that 10 years ago, people used to wonder if they bought something on
O'Malley says about 18 percent of Americans currently bank with a so-called "direct bank" -- an institution without branches -- but he expects that figure to jump to more than 50 percent over the next 10 years as the traditional big banks begin pulling back on the perks they offer to customers. O'Malley has already seen interest spike up at PerkStreet just over the past 6 months.
Interested in what the best options are for free checking? Check out this post for more details.
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Personal Finance - Want Free Checking? Ditch the Big Banks
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