Student or Standard Checking…and Other Considerations When Choosing an Account
Thursday, 01 December 2011 20:35 | Written by Alex Matjanec
Probably the biggest change students need to consider when opening a checking account is that the market has drastically changed and depending on your banking habits, a student checking account may not always be the best fit. Though many banks offer some form of "student" checking, these days it is worth checking out standard checking accounts as they may meet more of your needs.
Therefore you should:
• Keep ATM fees low (or non-existent) by choosing a bank that has branches both in your home and college town (most likely a national bank)
• If you are actively doing online banking, consider an online only bank (i.e. ING Direct or Ally)
• Choose an account with no minimums
• Consider the interest rate. If you are able to earn interest on any money you save, it is a huge plus.
You should avoid:
• Account bonus offers that carry qualifications to earn the deal. These accounts usually carry higher fees
• Choose a local bank that is not part of a larger ATM network
• Overdraft protection and any other security services—they usually carry monthly fees
Other things to consider:
Students need to really look closely at their banking habits to decide which account is best for them. Questions such as; "How often do I take out cash," "Do I need checks," OR "Is a local branch necessary?" will really influence the choices made when choosing the right account.
As an example, regarding the question around cash, if you take out money often, then your options for a student checking account decrease, but some student checking accounts do offer free access to out-of-network ATMs to accommodate for the active college lifestyle. Examples include Citibank's Student Account which offers free use of non-Citibank ATMs. U.S. Bank offers four non-U.S. Bank ATM fee refunds.
If a branch is not necessary, online banks are a great option as well. They come with almost all the same perks, and they are easier into standard accounts once you graduate. Examples include: Ally Bank, ING Direct, or Capital One (if you are on the west coast).
Whatever you choose, make sure you read the fine print! Don’t let any bank—branch or online—swindle you out of your hard earned dough.
Alex Matjanec is co-founder of MyBankTracker.com.