What makes for a good checking account?
Banks advertise them in many creative ways, but the essential goal for a consumer should be to minimize costs. Thus, MoneyRates.com used cost as its primary criteria in choosing the best checking accounts for 2018. In priority order, the following are the criteria used to compare checking accounts:
1. No monthly maintenance fees - These fees can eat away at your account month after month, so avoiding them should be a top priority.
2. Low overdraft fees - These fees are a big-ticket item. They should be avoided if possible; but in case you incur one or two, it is good to choose a bank that will minimize the damage.
3. Low minimum to start - It is especially important for customers with low balances to minimize fees, so MoneyRates.com looked for banks that had the above two characteristics and accepted new accounts with relatively low opening deposits.
Based on these criteria, we first list the top ten best checking accounts for 2018 overall, and then the top three in each of these specific categories:
- Best online checking
- Best branch-based checking
- Best checking with no opening minimum
As the chart below shows, some of the top-ten-rated banks overall also ranked in these other categories.
Best checking accounts overall
Excluding accounts that are only offered to limited customer segments (students, large accounts, additional product relationships), the following were the ten most cost-effective checking accounts MoneyRates.com identified. None of them charge a monthly maintenance fee.
1. Capital One 360 Checking
With no monthly maintenance fee and no minimum deposit requirement, this account met two of the basic criteria MoneyRates.com was looking for -- but what really made it stand out was the low $9 overdraft fee. With the average overdraft fee at $32.63, this represents a clear savings.
In addition to earning the top spot for best checking account overall, Capital One 360 ranked number one in these categories as well, making it the best online checking account with no deposit:
- #1 - Best online checking account
- #1 - Best checking account with no opening minimum
2. Arvest Bank Free Blue
This account has no monthly maintenance fee and, at $17, one of the lower overdraft fees you'll find. It does require a $50 deposit to open; but realistically, you'd have a hard time operating a checking account with much less than that.
Runner-up for best checking account overall, Arvest Bank also ranked number one in this category:
- #1 - Best branch-based checking account
3. Texas Capital Bank Smart Checking
This account requires a minimum opening deposit of $100; but with no monthly minimum and a $20 overdraft fee, the pricing would be attractive to many customers.
4. The Huntington National Bank Asterisk Free Checking
The $23 overdraft fee may not be the lowest, but it is still well below the industry average. With no monthly maintenance fee and no minimum opening deposit, this could be an ideal account for customers with small balances.
5. Ally Bank Interest Checking
Checking account interest doesn't amount to much these days, but it is an added perk on top of freedom from monthly fees and a reasonable $25 overdraft fee. Ally gets an added edge by capping overdraft fees at one per day.
6. Amalgamated Bank Affordable Checking
No monthly maintenance fee, no minimum opening deposit, and a below-average overdraft fee of $25 per occurrence put the Amalgamated Bank Affordable Checking solidly in the top ten checking accounts overall.
7. (tie). State Farm Checking
No monthly maintenance fee and a $25 overdraft fee. The minimum deposit to open an account is also $25, which shouldn't be a problem for the vast majority of customers.
8. (tie). USAA Bank Classic Checking
This account earned a tie for seventh with the same fee and minimum deposit features and benefits as State Farm offers.
9. TIAA Direct Interest Checking
This account requires a $100 deposit to open, but otherwise the terms are very good -- no monthly fee and a $25 overdraft fee with a maximum of three overdraft charges per day. On top of that, they pay a respectable interest rate, ranging from 0.25 percent to 0.71 percent depending on your balance.
10. UFB Airline Rewards Checking
Offering the same terms as the TIAA account above regarding opening deposit, monthly fees, and overdraft charges, this account does not pay interest -- although they do allow you the opportunity to earn airline miles based on your debit card activity.
|BEST OVERALL||BANK NAME||ACCOUNT NAME||OVERDRAFT FEE||MINIMUM DEPOSIT TO OPEN||BEST ONLINE||BEST BRANCH-BASED||BEST WITH NO OPENING MINIMUM|
Capital One 360
Texas Capital Bank
The Huntington National Bank
Asterisk Free Checking
(tie) State Farm
(tie) USAA Bank
UFB Airline Rewards Checking
Best online checking accounts
If you are specifically interested in online checking, here are some of the best accounts in that category:
1. Capital One 360 Checking
2. Ally Bank Interest Checking
3. State Farm Checking
Best branch-based checking accounts
If you are lucky enough to live in an area where they are offered, the following rated as the best branch-based checking accounts. You can read the details about each account in the overall section above.
1. Arvest Bank Free Blue -
- Ranked second in the overall category, this bank has 268 branches located in Arkansas, Kansas, Missouri and Oklahoma.
2. Texas Capital Bank Smart Checking -
- Ranked third overall, this bank has only 14 branches, all located in Texas.
3. The Huntington National Bank Asterisk Free Checking -
- Ranked fourth overall, Huntington National Bank is a good branch-based option because of its extensive network of over 1100 locations across nine states, mostly in the Midwest.
Best checking accounts with no opening minimum
Finally, if you are starting from zero, here are the best three checking accounts requiring no opening minimum. All made the overall top ten, so you can see details on these accounts in that section of this article.
1. Capital One 360 Checking
2. The Huntington National Bank Asterisk Free Checking
3. Ally Bank Interest Checking
ATM fees and interest checking
There are many individual features that the best free checking accounts may offer, and the significance of these features depends on how you intend to use the account. However, there are two frequently recurring issues that you should also consider:
1. ATM locations
- ATM fees are usually higher if you use a machine that is not owned by your bank or part of a network to which your bank belongs. So, if you are a frequent ATM user, choose a bank with ATM locations that are convenient to your usual movements.
2. Interest checking
- You may be attracted by the idea of earning interest on your account, but be advised -- for most balances, today's interest rates typically will not come close to making up for the monthly fee if one is charged. So the priority remains to find an account without a monthly fee. After that, earning interest is a nice plus if you can get it.
Finding an account that minimizes cost and is welcoming to smaller balances is a good start. After that, using that account responsibly by avoiding overdrafts is the way you can get the most use out of your account for the least cost.