The Best Checking Account
Best for Frequent Travelers
Best for Earning Cash Back
With outstanding customer service and low fees, Ally Bank makes it easy to keep money close and accessible — while earning a modest APY.
With access to more than 2 million ATMs globally and no fees for using your debit card abroad, Capital One is ready to go wherever you travel.
If you keep your checking account lean (under $50,000) Discover’s rewards program can help you earn more money than our other top picks offer.
The Best Checking Accounts
- Ally Interest Checking Account -
- Capital One 360 -
Best for Frequent Travelers
- Discover Cashback Checking -
Best for Earning Cash Back
The best checking accounts should keep your money easy to access while providing great customer service. It also won’t strain your finances with unnecessary fines like maintenance costs and dormancy fees.
Out of 32 banks offering nationwide or online checking services, Ally Bank’s Interest Checking Account won out for its combination of excellent customer service plus low fees. You can reach a customer service rep around the clock, so you don’t have to wait for standard banking hours if you have questions about your account. We also loved Ally's ATM reimbursement policy: If you use an out-of-network ATM, you can be refunded up to $10 per month. The bank also minimizes the fees it charges customers, and even offers a very low amount of interest for the money you keep in your account (a perk usually reserved for savings accounts). Our only complaint is that Ally Bank isn't great for international banking: It doesn’t offer outbound international wire transfers, and it charges a 1% flat fee across all international transactions.
If either of those sound like deal-breakers, we also loved Capital One's 360 Checking Account. Unlike Ally Bank, Capital One offers international wire transfers ($40), and you'll still be charged a currency conversion fee, Capital One doesn’t charge a fee for using your card abroad. We also love that you can skip the overdraft fees entirely by using Capital One’s auto-decline service. If you don’t have enough money in your account, the transaction will simply decline, without fees for trying.
We like Discover Bank's Cashback Checking Account primarily for its rewards program: you can earn 1% back on qualifying debit card purchases, with the potential to earn $360 in rewards every year. Unless you keep a lot of money in your checking account ($50,000 or more), you’ll earn more money with Discover than our other top picks. It’s also another good option for travelers. If you travel abroad, it might take a bit more legwork to find a Discover-compatible ATM, but like Capital One, you won't be charged foreign transaction fees.
How We Found the Best Checking Accounts
To find the best checking account, we started with a list of the 20 online banks we assessed when we reviewed the best bank. We also added the 15 largest brick-and-mortar banks in the US to our list. We wanted to compare services between these categories. Brick-and-mortar banks have the advantage of allowing you to meet in person with a rep 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. (They also offer much more competitive rates if you're opening a savings account.)
Every checking account needs to have FDIC or NCUA backing.
In the rare event a bank goes under, we wanted to be sure our money wouldn't go down with it. The Federal Deposit Insurance Corporation (FDIC) guarantees that if a bank fails, its depositors see some of their money back. The National Credit Union Administration (NCUA) is another federally monitored program which insures credit unions. If your bank or credit union fails, but is insured by either the FDIC or NCUA, you’ll be paid out by one of these insurance agencies — up to $250,000 per account.
It should also avoid monthly service fees.
As Forbes explains, checking accounts with low balances cost banks money. So many banks charge fees simply for letting you have a checking account. If you want to avoid those fees, you have to jump through hoops: Bank of America, for instance, requires you to link a recurring direct deposit of $250 or more to your account or maintain a daily minimum balance of at least $1,500 if you want to avoid their $12 monthly charge.
Brick-and-mortar banks were the most prone to charging service fees. Of the 15 on our list, the only one that didn't was Consumers Credit Union. Chase Bank charges a $12 monthly fee for their Total Checking Account, which is waived only if you set up a direct deposit of $500 or more, or maintain a daily minimum balance of at least $1,500. PNC has a similar policy but with even higher balance requirements — and an even higher $25 monthly fee.
We focused on the banks that didn't add caveats to "free checking." If you've only got 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.
We looked for banks with 24/7 customer service and multiple channels of support.
The best checking account will be able to help us in our hour of need – no matter what hour of the day that is. To find the most customer-friendly banks, we used a methodology similar to the criteria we used to find the best bank, looking for:
- Customer Support: We gave points to banks offering a variety of support methods (telephone, email, chat, and social media) and gave extra points to those available at any hour. If you lose your debit card, you shouldn’t need to wait until business hours to report the loss or request a new one.
- Mobile Banking Tools: We also gave points to banks which allowed us to connect via mobile app, making transfers and deposits the work of a few finger swipes. We particularly liked Ally Bank’s Card Control app, which lets you suspend your debit card for a few days if you lose it – as well as reactivate it if you find it in your couch cushions.
- Easy-to-find Fee Schedules: Even banks with no monthly service charge are likely to fine you for things like overdrafting your account. Banks are required to disclose those fees, but some provide this information front and center in large font, and others bury it in fine print. We wanted banks that made fees easy to find and compare.
We cut eleven banks for having sub-par customer support services (including our sole remaining brick-and-mortar bank, Consumers Credit Union). For many, contact meant adhering to their particular business hours, regardless of whether we lived in Florida or Alaska.
We compared fines and fees to find the most lenient provider.
This left us with five online checking account providers, all with excellent customer service.
- Alliant Credit Union
- Ally Bank
- Capital One 360
- Discover Bank
- First Internet Bank
From here, we dug into each bank’s fee schedule and disclosures. We wanted to find the providers that offered the best long-term value, avoiding those that would unnecessarily nickel-and-dime our balances. We checked for five common fees.
- Dormancy and Inactivity Fees: Both First Internet Bank and Alliant Credit Union charge dormancy fees — if they determine that your account isn’t active enough, they’ll charge $5 or $10 monthly fines (respectively) for you to keep your account open.
- Returned Item Fee: Except for Discover, all of our finalists charge a fee if you write a manual check and it bounces. The fees ranged from $7.50 (Ally Bank) to $20 (First Internet Bank).
- Check and Debit Card Replacements: All of our banks give you a debit card and a box of checks for free upon signing up. But Ally, Capital One, and Discover also offer free debit card replacements if you lose yours. And Ally and Discover go the extra mile by continuing to offer free checks even after sign-up.
- Wire Transfer Fees: None of our banks charge a fee for incoming wire transfers, but they universally charge fees for outgoing wire transfers. For a domestic destinations, expect to pay between $20 and $30. Ally Bank doesn’t allow outbound international wire transfers, but for our other banks, the fees range a little higher, from $30 to $50.
- We took a particularly close look at Non-Sufficient Funds (NSF) Fees. Every bank charges NSF fees of some type: If you overdraw your account, the bank will allow the transaction to go through but will charge you a fine. Alliant Credit Union and First Internet Bank again stood out for the wrong reasons, charging $25 - $30 fines for every single NSF transaction. Ally and Discover also charge $25 and $30 fines, but you’ll only be fined once per day, no matter how many overdrawn transactions hit your account. Capital One stood out as the only bank with the option to avoid this fee – if you don't opt into the NSF charge, Capital One will simply refuse transactions for which you don't have the funds.
After comparing fees, we eliminated both Alliant Credit Union and First Internet Bank for consistently charging more than our other finalists. (Alliant even charges a $5 fee for writing paper checks.) This left us with three top picks, representing the cheapest, most accessible checking accounts we could find.
Our Favorite Checking Accounts
Our Picks for the Best Checking Accounts
We weren’t surprised when Ally Bank – our top pick for the best bank – also earned our award for best checking account. Ally has impressive customer service to help you get set up, with representatives available 24/7 whether you choose to contact them by phone, email, or live chat. Its mobile app also makes it easy to deposit checks, transfer funds, or check your balance from anywhere.
On top of no monthly maintenance fee, Ally Bank 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 to draw upon, you’ll be charged $25 no more than once per day (versus the $30-$35 charged by Discover and Capital One). Ally Bank's fee outgoing wire transfers is also just $20, as opposed to Discover and Capital One's $30 charge.
You get two additional perks, as well. Ally offers $10 monthly to reimburse any out-of-network ATM fees you might incur (although they do have 38,00 in-network ATMs). Its checking account also accrues interest. The interest is modest — either a base 0.10%, or 0.60% if you maintain a balance of $15,000. But since most banks only offer interest on savings accounts, we appreciated the ability to earn anything at all via our checking accounts.
Ally Bank is excellent for domestic banking, but if you travel frequently or have financial obligations in other countries, 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 — 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 below at Capital One’s 360 account or Discover Bank’s Cashback Checking Account instead.
Capital One did well in our customer service evaluation and fee assessment, with excellent customer support and a relatively low number of fees. Of note, Capital One’s Overdraft Policy defaults to “Auto-Decline,” so if you don’t have enough money in your checking account to cover the transaction, it simply won’t go through. Most banks either charge you NSF fees or require you to open up a savings account with them to protect against overdrafts.
Capital One offers four different overdraft options.If you don’t want to “auto-decline,” you can opt into free transfers from a linked savings account, use a pre-approved overdraft line of credit (which charges interest), or enroll in its next day grace program (with a $35 fee per transaction).
Like Ally, Capital One also offers interest rates for funds kept in a checking account. The annual percentage yield (APY) varies depending 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 it’s over $100,000. This marginal benefit is offset, however, by Capital One’s increased fees. Our other top picks issue Cashier Checks for free and give you new boxes of checks for free – Capital One charges for both. Additionally, Capital One’s fines tend to be higher. If you do have a check bounce, or make frequent wire transfers, you’ll spend more in fees with Capital One than with Ally or Discover.
Capital One really stands out with its international services. Unlike Ally, Capital One offers international outgoing wire transfers in addition to domestic ones – so if you do business or relatives overseas, Capital One will make your life easier than Ally.
Capital One's debit cards are also backed either by MasterCard or Visa. This makes it easy to find one of Mastercard’s 1.8 million ATMs or one of Visa’s 2 million ATMs through their locator tools, no matter where in the world you go. And unlike Ally, Capital One doesn’t charge a fee for using an international ATM. (Although note that Visa and Mastercard do get to determine the exchange rate of your transactions.)
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% cashback on up to $3,000 in qualifying purchases. You won't be able to earn more than $360 per year, but you'll still be earning more money faster than you would with Ally: Even 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).
Discover is also a solid option for international travelers. Its outgoing wire transfers are cheaper than Capital One's ($30 versus $40), and like Capital One, Discover doesn't charge foreign transaction fees when you use your debit card at a restaurant, shop, or in-network ATM abroad. Discover comes with one strong caveat, though: you might have a harder time finding a compatible ATM.
Discover is accepted at roughly the same number of ATMs as Visa or MasterCard – around 1.9 million – through a network of partner banks. But actually locating those ATMs can be a struggle. You can check Discover Bank’s ATM Locator, but to find the ATMs of partner banks, you'll need to use those partner bank's ATM locators (or the Diners Club International ATM Locator, another partner). Discover Bank gives you a map of ATM locations, but Diners Club does not, and the offerings of local partner banks will vary. This translates to a lot more legwork on your part if you're in a foreign city trying to track down an ATM. And if you do end up resorting to an out-of-network ATM, Discover charges higher fees compared to Ally and Capital One – $10 or 5% of the transaction total, whichever is greater.
We’d add one final caveat about Discover Bank: even though Discover’s NSF fee is only slightly more expensive than Ally’s – $30 compared to $25 – Discover Bank’s greatest downside is its Overdraft Protection Policy. If you opt into Overdraft Protection, you’ll need to have a linked savings or money market account to transfer available funds. 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 Protection Policy will not help, and you will be charged an NSF fee. 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.
How Much Money Should I Keep in My Checking Account vs Savings Account?
Deciding how much money 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 – by earning the most money.
For checking, the answer is pretty straightforward. You should keep at least one month’s worth of expenditures in your checking account. This should cover your monthly expenses that you calculate for in your budget like rent, utilities, transportation, and groceries – as well as your planned “fun” spending money. Having a little extra — as Business Insider writes, at least one month’s net pay — means that if you have to make an unexpected trip to the doctor or you decide to go outside your budget for a new video game, you have enough money in your checking account to cover your credit payments and your debit card withdrawals.
Having more than that little extra, however, means you’re leaving money on the table. Checking accounts generally earn less interest than savings accounts (check out our best savings account review to read more). Keeping more money in checking means earning less interest in savings – so it’s good to make sure your checking account isn’t overfull.
It’s more difficult to say how much should be in your savings account. Forbes recommends three to six months of expenses while Business insider recommends three to six months of net pay. As CNN notes, it again comes down to the level of risk you’re willing to take. 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 savings account, letting you 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 have children, or are saving up for a larger 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 immediately available.
The important thing is to be aware of your financial decisions and plan out where you intend to put your money – whether checking, savings, or elsewhere – so you can make sure that your money is in the best place for you.