With the Federal Reserve raising interest rates from historical lows and the stock market regularly flirting with record highs, it’s fair to wonder what we should do with our cash. In the hope of answering that pressing question and providing strategic guidance to frugal consumers, WalletHub analyzed the rates, fees and features associated with more than 2,300 checking accounts, savings accounts, money market accounts and CDs from banks and credit unions of all shapes and sizes from across the country.
You can check out our findings below. Hopefully, the trends and tidbits that we unearth will help you make the smartest possible financial decisions moving forward.
With certain checking accounts charging close to 50 different fees, it’s nearly impossible to keep track of the growing structural complexity of this supposedly basic banking tool. As a result, the cost of everyday checking can vary by hundreds of dollars per year based on what account you have and the way in which you use it.
In order to more accurately assess the extent of the problem, WalletHub compared the annual cost of each traditional checking account offered by 35 of the largest consumer-facing U.S. banks and credit unions, using five theoretical consumer profiles as our test cases. This report, together with WalletHub’s corresponding Checking Account Transparency Report, will therefore help give consumers a holistic view of both the good and the bad aspects of the checking market.
Checking accounts have become a staple in the average consumer’s financial arsenal, with more than 100 million such accounts in use today, according to the FDIC. Their popularity is unsurprising, given the versatility of this banking version of a Swiss Army knife, which allows consumers to make everyday purchases, directly deposit their earnings, withdraw cash as needed and pay bills online – all with a single account.
But while one might expect a certain amount of uniformity from the market for such a ubiquitous financial instrument – particularly when it comes to account terms and fee disclosures – that’s unfortunately not the case. The opposite actually is true, as consumers face disclosure practices that resemble the Wild West. As a result, the country’s three biggest banks earned more than $6 billion in 2015 from ATM-withdrawal and account-overdraft fees alone, according to SNL Financial.
Online statements provide both convenience and security. They’re available sooner than paper statements, they can be accessed anywhere there’s an Internet location, and they simplify long-term record keeping. Plus, online statements help the environment.
Consumers are thus proving to be increasingly receptive to online statements, especially as mobile banking functionality continues to improve. Nearly 29% of banking customers had opted-in for online statements as of 2013, according to DigitalMailer research, which represents an 11% increase from the year before.
With that being said, the primary goal of this report was to determine the online record-keeping policies of the nation’s largest banks and credit unions – including the length of time records are available for immediate download, what types of historical records are maintained, and the cost associated with accessing them.
It’s no secret the nature of personal finance has shifted considerably in recent years. Technology has closed the door on the era of neighborhood banking, bringing consumers simultaneously closer to and farther away from their financial institutions of choice. Widespread economic woes have unearthed a number of unsavory practices and institutional failures, while also saddling us with an uphill financial battle. Even the new regulations designed to cure the ills of years past have taken some getting used to.
Most people expect small community banks to operate a bit differently than big national banks. There’s certainly rhyme to that reason, but we also tend to assume those mega-banks offer standardized national rates, regardless of where their customers happen to live. That part, interestingly enough, isn't quite true.
WalletHub analyzed savings accounts from the 10 largest U.S. banks in order to determine which institutions price their products geographically as well as how local competition among national banks impacts consumer rates. We found that 3 out of 10 banks offer different rates to consumers based on where they live, whether through disproportionately priced promotions or standard operating procedure. Perhaps more importantly, however, is the fact that interest rates vary by as much as 550% from city to city depending on whichever 2-4 major banks happen to have a significant presence in given area.
Editorial Disclaimer: Editorial content is not provided or commissioned by financial institutions. Opinions expressed here are the author’s alone and have not been approved or otherwise endorsed by any financial institution, including those that are WalletHub advertising partners. Our content is intended for informational purposes only.
Ad Disclosure: Offers originating from paying advertisers are noted as “Sponsored” on the offer's details page. Advertising may impact how and where offers appear on this site (including, for example, the order in which they appear). At WalletHub we try to list as many offers as possible but we don't make any representation of listing all available offers.