One might consider an article talking about choosing the best bank account in this modern day and age rather absurd. But knowing your individual spending habits and money needs might help you choose the correct bank account. In today’s fast evolving economic world no two products are the same and neither are bank accounts. Bank accounts offer different features. Some pay higher interest than others, while some don’t. Some are catered for the needs of senior citizens while some are tailored exclusively for students. Despite their various options, one thing in common to all bank accounts is the fact that they all charge fees. However, this fee can be waived if certain privileges are given up. Listed below are certain considerations which consumers should keep in mind while choosing the best bank account:
Bank Account Information For Choosing The Right One
- The Amount Of Money You Are Planning To Deposit can be a big determinant in choosing the best bank account. While the default way to go would be to determine which account pays the highest interest or APY (annual percentage yield), bank fees can also be a major determinant. An annual study by bankrate.com shows that for an account to get interest while not having to pay any monthly fees with a check facility, the minimum balance required is $3,460. On the other hand for an account to have a check facility but not earn any interest the minimum balance to not incur any additional fees is a little below $110.
- Using Your Check-Book: Certain consumers are not going to write too many checks and are not going to exceed the maximum number of allowed free check transactions by their bank accounts. In this case it may be beneficial for consumers to opt for a flat fee checking account. However, if you are in the habit of writing several checks it may be beneficial to talk to a banking representative and work out the best bank account option for yourself so that you do not get charged a high penalty fee for exceeding the number of allowed free banking transactions.
- Economies Of Scale are what consumers get when they have several bank accounts with the same bank. If you have been using several products offered by the same bank, make sure you get your fees aggregated or ask for discounts on your current facilities. Most banks nowadays have consumer loyalty programs.
Basic Bank Accounts To Choose From
In addition to the above mentioned considerations, consumers may also want to consider some of the accounts mentioned below to ensure that their funds are in the right place:
- Savings Account: When placing your funds consumers are often concerned with security. In this case bank offered savings accounts are the safest option, although they may not pay as high interest as some of the other available option they make up for the same by offering great security. In addition these bank accounts are backed by what is known as FDIC (Federal Deposit Insurance Corporation) insurance.
- Certificates of Deposit And Money Market Accounts: CDs require consumers to lock in their money for a period of 3 months up to five years. Another option may be investing your money in the money market during a bull market as the returns which the money market would generate would far surpass your interest rates offered by your banks.
These are some of the considerations consumers should keep in mind while choosing the best bank account.
References:
- Pick the right account – CNN Money
- Savings Account Overview – Money Instructor
