The Best Checking Account
How We Found The Best Checking Account
32 banks evaluated
8 common fees compared
3 top picks
The Best Checking Accounts
We looked at 35 nationwide banks or online checking services, digging into the numbers and fine print to uncover the best checking account for every lifestyle. We dinged banks with less-than-stellar customer service and unnecessary fines hidden within the fine print (like maintenance costs and dormancy fees). Our top picks make it easy to access your money and reach a human when you need assistance.
How We Chose the Best Checking Accounts
Our search for the best checking account began with a list of the 20 online banks we evaluated when we reviewed the best bank. We then added the 15 largest brick-and-mortar banks in the U.S. to compare services between the two categories. Brick-and-mortar banks have the advantage of allowing you to meet in person with a representative to set up an account or resolve issues. Online banks typically offer the same services but don’t have physical locations — and because they have clients across the country, they’re more likely to offer 24/7 live customer support. We thought most people would prefer not having to weave around normal business hours to find answers to pressing financial questions. Online banks also offer much more competitive rates if you’re opening a savings account.
FDIC or NCUA backing
If your bank ever were to go under, the last thing you would want is your money to go down with it. The Federal Deposit Insurance Corporation (FDIC) guarantees that if a bank fails, its depositors see some of their money back. TheNational Credit Union Administration (NCUA) is another federally-monitored program that insures credit unions - so if your bank or credit union fails, you want to make sure your money is covered. In this case, “covered” means you will receive up to $250,000 back per account from the FDIC or NCUA.
No unreasonable fees
We focused on the banks that didn’t add caveats to “free checking.” If you only have a couple hundred dollars in your account before payday, or if something happens to your payroll deposit, you shouldn’t have to worry about being hit with an unnecessary fine. Do be aware, however, that checking accounts with low balances can cost banks money — so these fines aren’t totally unavoidable. Brick-and-mortar banks are more prone to charging these servicing fees, which is another reason why we leaned toward online banks.
We dug into each bank’s fee schedules and disclosures to find providers offering long-term value — we nixed banks that seemed hungry for any extra penny they could snatch out of your pocket.
Solid customer support
Regardless of the time of day, you should be able to seek support when it comes to your money. We looked for banks with the best, friendliest customer support by also evaluating means of communication, ease of use when it comes to mobile banking tools, and overall transparency. We favored banks with several modes of customer support — email, telephone, live chat, and social media — and gave bonus points to those open around the clock. If you’re banking online, you should be able to make transactions from your thumbs without having to wait or reboot a faulty app. And if a bank plans on slapping you with fees for various reasons, it should have them all listed in plain sight before you decide to sign anything.
The Three Best Checking Accounts
Ally Interest Checking Account
Why we chose it
We weren’t surprised when Ally Bank, our top pick for the best bank, also clinched the top spot for checking accounts - and a lot of its success has to do with its customer service. With representatives available 24/7, you can choose to contact customer support via phone, email, or live chat. When we called late at night with a customer service request, Ally reps sound surprisingly pleasant and eager to help.
The Ally mobile app also makes it easy to deposit checks, transfer funds, or check your balance from anywhere and at any time. For reference, just take a look at the app’s 4.8 ratings on the App Store and 3.5 ratings on Google Play — it’s safe to say most people agree on Ally’s reliable app and customer service.
Most banks only offer interest accrual on savings accounts, but Ally stands out as an exception. You can earn 0.1% back in interest on daily checking balances under $15,000 and 0.6% on balances over $15,000. This means you could earn $10 for carrying a daily balance of $10,000 and $120 for a $20,000 balance over 12 months.
Low monthly fees
On top of not making you worry about a monthly maintenance fee, Ally bank also has the lowest fines of our top picks. If you overdraw your account and haven’t connected an Ally Online Savings or Money Market account from which to draw, you’ll be charged $25 no more than once per day (versus the $30-$35 charged by Discover and Capital One). Ally Bank’s domestic outgoing wire transfer fee is also just $20, as opposed to Discover and Capital One’s $30 charges. And if you make a lot of withdrawals on the go, Ally offers $10 per statement cycle to reimburse any out-of-network ATM fees you might incur (although it does have over 43,000 fee-free ATMs in the U.S.)
Points to consider
International transaction limitations
Ally Bank is a strong choice for domestic banking, but if you travel frequently or have financial obligations in other countries, you should be aware of a couple drawbacks. To start, Ally doesn’t allow outgoing international wire transfers — you’ll need to use a different bank to send money abroad. Additionally, Ally charges a 1% fee on all transactions and withdrawals made abroad with your debit card, and this is on top of any currency conversion fee that might occur. If you’re looking for a checking account you can use globally, we recommend taking a look at Capital One’s 360 account or the Discover Cashback Debit account instead.
Capital One 360
Why we chose it
Unlike other banks, Capital One automatically defaults to “auto-decline” if you overdraw your account. This means that if you’re about to spend more than you have in your checking account, Capital One simply won’t let the transaction complete. It sounds harsh, but it could actually save you some money over time. However, this is just one option of four — you can choose to have funds automatically withdrawn from your savings, pull a line of credit (on which you’ll pay interest), or you can opt for its next-day grace program, which gives you a full 24 hours to pay your debt before Capital One hits you with a $35 fee.
We appreciate how Capital One caters to frequent travelers — you can use your debit card anywhere you see the MasterCard logo without having to worry about a foreign transaction fee. To compare, Ally charges you 1% of the foreign transaction, even when you use it at an Allpoint ATM. Discover, on the other hand, doesn’t have restrictions on use at participating locations in Canada, Mexico, and the Caribbean — but it might charge you in other areas.
Like Ally, Capital One offers interest earnings with its checking account, although the rates vary. The APY varies based on your balance: 0.20% if it’s $49,999.99 or less; 0.75% if it’s between $50,000 and $99,999.99; and 1.00% if its $100,000 or more. Not sure which benefits you? Ally’s interest rates are best for checking accounts with balances between $15,000 and $49,999 — if your account has less than $15,000 or more than $50,000, you’ll get better interest rates from Capital One.
Capital One did well in our customer service test, but it also offers a unique approach to your average brick-and-mortar experience on top of its online services and highly-rated app. For those of you who prefer physically speaking to someone as opposed to virtually or by phone, Capital One gives you a casual platform to do so with its “Capital One Cafe.” While there, you can seek representatives to answer all of your financial questions or just enjoy a cup of coffee — regardless of whether you’re a customer. Do note, though, that these locations are currently only in major cities.
Points to consider
Our other top picks issue cashier checks for free and also give you new boxes of checks for free – Capital One charges you $20 and $5, respectively. Additionally, Capital One’s fines tend to be higher. If you do have a check bounce ($9), or make frequent wire transfers (outgoing domestic: $30), you’ll spend more in fees with Capital One than with Ally or Discover.
Discover Cashback Debit
Earning Cash Back
Why we chose it
Cash back perks
Discover Bank offers checking customers a cashback rewards system rather than the interest-bearing accounts of Ally and Capital One. With a Discover debit card, you can earn 1% cash back each month on up to $3,000 in qualifying purchases. You’ll be able to earn up to $360 per year. By comparison, at Ally’s highest interest rate, you’d need $60,000 in your checking account to earn $360 annually (and you’d need at least $50,000 with Capital One).
Foreign transactions and transfers
Discover won’t charge you a foreign transaction fee if you use your card at a participating location in Canada, Mexico, and the Caribbean. Like Capital One and Ally, Discover doesn’t charge a fee if you receive a wire transfer in U.S. currency from a bank overseas — but Discover also doesn’t limit you to incoming international wire transfers — it actually allows you to initiate them (for a $30 price tag). So if you have financial obligations overseas, Discover has you covered.
There’s no need to fret over your first experience overdrawing your account or needing a stop payment — Discover will waive your first fee. Plus, if you happen to lose your debit card or need more checks, Discover won’t charge you for those either. Knowing you have a slight buffer after opening your account might help incentivize healthy account behaviors for the future, and we appreciate the leniency.
Points to consider
Overdraft protection limitations
The great thing about Discover’s overdraft protection service is that as of June 16, 2019, it's free — you'll never be charged a fee for insufficient funds (if your linked savings or money market account doesn't have enough funds to cover a purchase, either, the payment will just be declined). But Discover will only transfer funds if an externally-initiated transfer or bill payment causes the overdraft. If you set your bills to auto-pay and one of them causes an overdraft, for example, that overdraft will be covered. However, if you go to an ATM or use your debit card and cause an overdraft, Discover’s overdraft protection service won't kick in (instead of pulling from your linked account, the transaction will just be declined). If you don’t normally keep a lot of cash in your checking account, this means you might have to keep a closer eye on your checking account after bills have been processed.
Guide to Checking Accounts
Know where you want to put your money
It’s best to plan financial decisions in advance and strategically place your money into your checking, savings, or elsewhere, before spending haphazardly. Deciding how much to keep in your checking account versus your savings account depends on your spending habits and risk tolerances. But it’s largely a question of where your money will do you the most good in the long run.
Be aware of account upkeep
As previously stated, some banks will charge you for inactivity. And “inactivity” can have different meanings for different banks. We did the vetting for you — all of our top picks come without the extra baggage of monthly maintenance fees and entrance deposits. Some banks, like Bank of America, however, have restrictions on how much money you keep in your account every month — if you fall below the limit or don’t meet the mark one month, you’ll be hit with a $12 charge.
Think about your savings
Being able to financially prepare for the future helps boost an overall sense of wellbeing, but it can be difficult to know exactly how much should go into your savings. Experts recommend three to six months’ worth of expenses for your emergency stash, but for retirement and other long-term planning, consider consulting a financial advisor.
Consider linking your checking and savings
While it certainly isn’t required to place your checking and savings money into the same hands, it could be more convenient, especially when it comes to making transfers and overdrawing on your checking. If you have your checking in one place and savings in another, you will have to wire money between banks to make transfers, and this could take more time. But, if you like the APY offering of one savings account (Ally is now at 1.90%) and the overdraft options of another (Capital One), for example — the choice is yours to bank with both.
If you can predict how much you’ll make and spend for the next few months with confidence, you have a stable job and consistent spending, you might only need three months’ expenses in a savings account. This might also give you some room to invest the rest of your earnings in higher interest accounts like 401ks, mutual funds, IRA accounts, or investments with stock markets and lending clubs. But if you have children or are saving for a large goal like a house or car, your savings account might swell beyond this initial three to six months of net pay because the future isn’t so certain or you need to have cash funds more readily available.
Checking Accounts FAQ
What is the difference between APR and APY?
Both your annual percentage rate (APR) and annual percentage yield (APY) calculate interest. APR measures the interest a bank will charge you for borrowing its money, and APY is the amount of interest you can earn on your investments.
What should I consider before opening a checking account?
Before devising a plan on where to place your money, you first need to have a clear idea of how much you actually spend in a month and compare it to your income. You should account for major expenses like rent, bills, and loans. Then take a look at what you spend on food, gym memberships, monthly subscription services, and any other funds you use to simply enjoy your life. After unearthing this number, you then need to add a little more as a buffer for any extra expenses.
Is there a limit to how much I should keep in my bank account?
At the end of the day, this is really up to you. Having more than that little extra in your checking account means you’re leaving money on the table. Checking accounts generally earn less interest than savings accounts (check out our best savings account review for reference). The more money you leave in your checking as opposed to your savings means the less money you’ll earn back in interest savings over time.
The Best Checking Accounts: Summed Up
Other Banking Reviews
We’ve covered all the bases for you when it comes to saving, spending, and earning. Read on: