Online banking is becoming increasingly popular in this digital age we live in. From shopping for groceries to paying our monthly bills, it seems like most things we do are done online. So, why shouldn’t our banking be done online, too?
There are plenty of benefits to online banking. From higher-than-average rates on bank accounts and CDs to low or no account fees and user-friendly technology, it seems there are many reasons why online banking makes sense for so many Americans. And the benefits are getting bigger and better every day.
But finding the right online bank isn’t always easy. There are dozens of online banking options to select from, and many of them offer a lot of the same things. With so many choices, how can you really be sure you are managing your money with the best bank for you and your financial goals?
Financial situations change, just like the seasons do. You won’t always be in your current financial position, which is why it is wise to look to the future when making decisions about online banking.
10 Best Online Banks
Whether you are new to the online banking game or have already enjoyed the benefits and are looking to explore other options, carefully weighing the pros and cons of each bank will help you make an educated decision. Here is a list of the 10 best online banks to help you manage your money, get your spending in order, and even introduce you to the art of investing.
Formerly known as Commercial Investment Trust Bank, CIT Bank offers a broad variety of custodial and retirement account options. This makes CIT Bank a sensible choice for multi-general families and long-term clients hoping to maximize their investment in their future. Deposit accounts like the bank’s Premier High-Yield Savings account require a minimum $100 opening deposit and minimum balance, while others, like its Jumbo CDs, require $100,000 for a minimum opening deposit. If you’re ready to get serious about saving, CIT Bank may be a wise bet.
Good customer service is crucial when dealing with online banking. Whether your card has been stolen or you are dealing with unauthorized charges, it’s important that your bank be able to provide the assistance you need at the time you need it. There are few things more frustrating than dealing with the run-around when you’ve got pressing issues, particularly relating to money. Axos Bank doesn’t have a problem in this regard. Formerly known as Bank of Internet USA, Axos Bank offers a range of customer service options to deliver prompt help, from 24/7 phone chat to online messaging and secure communication through Twitter. But aside from good customer service, Axos offers plenty of other perks, too. For one, Axos Bank customers will pay no monthly maintenance fees for checking or savings accounts. The bank also offers great checking rates and a range of other rewards and benefits, like domestic ATM fee reimbursements. Peer-to-peer payments make sending money to friends and family easy, while Axos’ referral plan makes it possible to get cash when you get someone to sign on.
Chime has built a reputation as a reliable platform in the sprawling universe of online banking. This platform prides itself on an aversion to fees, which is a great benefit for customers in and of itself. In addition to no overdraft fees, Chime users also enjoy no monthly service fees, no minimum balance requirements, no foreign transaction fees, and no transfer fees…period. Given that fees are one of the biggest determining factors for customers on the fence about online banking, Chime has a leg up here. Another big perk Chime customers enjoy is early access to paychecks. By setting up Direct Deposit with Chime, customers can receive payment two days earlier than their colleagues. This is a valuable perk for so many Americans currently living paycheck-to-paycheck, particularly during times of widespread financial stress. For users who want a laid-back approach to online banking, Chime is a safe way to go.
Ally is one of the very best in the online banking game because it’s got a little something for everyone, it seems. In a market of ever-growing possibilities, one with new options growing by the day, online banks must diversify and keep up with the times or risk losing their customers to the next best thing. Ally is quite good at this, as they offer a variety of benefits across their services. Customers interested in savings, for instance, will get more for their money with a 0.80% Annual Percentage Yield and no monthly maintenance fees. But that’s not all. Ally’s online platform simplifies the savings process through the use of “buckets” which act as digital envelopes to help you prioritize your spending and savings goals. And with 43,000 Allpoint ATMs, you can be sure your money is never too far away.
Part of choosing the right online bank includes planning for the future. Many online bank users will begin their investment journeys in the years to come, and so a platform that allows for trading can be highly convenient. Ally, as it turns out, is also a great choice for customers hoping to dive right into the world of investing. Ally users can trade commission-free with the online bank’s Invest Self-Directed Trading. And it won’t cost an arm and a leg, either. In fact, Ally customers can start investing for as little as $100. Other perks include a $500 discount for Ally customers that use the bank to refinance or purchase a home. This is a nice bonus for families hoping to simplify their finances.
There’s no denying the sense of security that comes with dealing with an online bank like BBVA. The bank’s mobile app was named one of 2019’s leaders in mobile banking by Javelin Strategy & Research, which is no small feat. And it’s earned plenty of customer loyalty over the years, too. BBVA employs several full service banking options. Some of these include checking accounts, savings accounts, money market, IRAs, and CDs, among others. What’s more, BBVA’s Simple Cash Back program makes it possible for customers with online checking and free savings accounts to earn cashback rewards on debit card purchases. And there’s no shortage of BBVA ATMs – the bank currently has over 64,000. Plus, opening an account is easy. All you’ll need is a $25 initial deposit to get started.
Credit unions are the first choice for many borrowers because they often offer better interest rates than traditional banks. Alliant Credit Union is no exception. Not only does Alliant offer great rates, but they also have a less strict membership criteria, which may accept customers traditional banks may not. Alliant also treats its young customers well, with separate checking and savings accounts accessible to minors. One of the perks is a relatively high interest rate. Another is the ability of parents to maintain joint ownership of the account. This allows children a great opportunity to begin learning about money management at an early age. Alliant also lets members operate up to 19 separate, unique accounts for targeted savings. In addition to an above-average rate on savings accounts, you also won’t pay monthly fees if you sign up for e-statements. And there are plenty of ways to withdraw your money, with Alliant’s over 80,000 ATMs across the U.S. Better yet, they’ll even reimburse up to $20 each month for fees associated with out-of-network ATMs. And while Alliant doesn’t require customers to keep a minimum balance for checking accounts, savings account customers must keep a daily average of $100 in their accounts over the month in order to earn interest.
Capital One 360
Capital One 360 offers customers more than your typical online-only bank. In addition to savings accounts, checking accounts, and CDs, Capital One 360 also employs a robust investing platform that allows customers to build a portfolio of stocks, mutual funds, and ETFs with ease. With Capital One 360, customers can also gain access to offers like fixed or adjustable-rate mortgages, and if you need auto loans or any other type of extensive business or commercial banking, Capital One 360’s parent company, Capital One, can help. And when it comes to security, Capital One 360 has you covered. Deposits are protected by the Federal Deposit Insurance Corporation, while data is fully encrypted and subject to security features like intrusion detection, firewalls, and multi-factor authentication. You can never be too careful where security is concerned, and Capital One 360 knows this well. Convenience is also a player here, as users can schedule automatic deposits and track progress through the app’s My Savings Goal feature. Online banking has never been easier than it is with Capital One 360. It’s one of the many impressive options on this list.
Charles Schwab is a hybrid of brick-and-mortar and online banks, and it does the latter quite well. The Schwab Mobile banking app allows users to seamlessly transfer between their Charles Schwab accounts, make deposits, and get a birds-eye view of their finances through the bank. Other benefits include no monthly fees or foreign transaction fees, and customers can also enjoy a good APY on checking accounts. Charles Schwab doesn’t have its own ATMs, but then again, it doesn’t need them. The bank will refund all ATM fees so users can withdraw from anywhere, any time.
Simple is an online bank that makes saving easy. How? This mobile-first bank automatically segments your funds into buckets, consisting of recurring expenses, long-term savings goals, and liquid funds. And it also rewards savings. Its Protected Goal Accounts, for example, offer yields as good as other popular online savings accounts. Other perks include no fees on ATM withdrawals from over 40,000 locations nationwide, as well as budgeting app integrations to make managing your finances, well… simple.
Discover’s online banking experience is a great choice for a wide range of customers. With offerings from savings and checking accounts to CDs and credit cards, Discover doesn’t cater to just one type of user. Not only does Discover shun fees for online checking accounts, but they also employ a balance transfer card with no annual fee and a promotional 0% APR for customers hoping to consolidate debt. Users can also invest in a money market account with a solid APY. All in all, Discover makes good on its commitment to deliver reliable online banking services, and it does it with loyal followers growing by the day.
Things to consider when searching for an online bank
Several factors come into play when you’re shopping for an online bank. Knowing what to look for before you begin can help you make wise decisions for your financial future. From security software to fees and smartphone apps, the best app for you will depend on your unique financial standing and your goals for the future. Here are a few key factors to keep in mind when searching for an online-based bank to do business with.
Protection is everything when managing your money online. You work hard for your money and you want to make sure that your assets are always safe and secure. You wouldn’t take a gamble with your home’s security, so you shouldn’t take risks with your financial security, either. And there’s ample data to suggest that there’s plenty to be concerned about. Millions of consumers fall victim to internet hackers every year, making banking security a potential roadblock for consumers hoping to take their money management strictly online. Choosing an online bank that prioritizes security and protection for customers will give you peace of mind and help you remain confident in the way you manage your money.
Ease of use
Life is complicated, but that doesn’t mean online banking has to be. Given that the vast majority of your dealings with an online bank will be conducted through your computer or smartphone, ease of use is important and something you shouldn’t have to compromise on. Before selecting an online bank, be sure their computer and smartphone apps are easy to understand and navigate. Figuring this out early will save you a lot of frustration in the long run. Anyone who’s dealt with a lost or stolen debit card can attest to the importance of ease-of-use in the realm of online banking.
High fees are something that can definitely stand in the way of you and your ideal online bank. Just like regular banks, online banking platforms often carry fees for monthly use. Some online banks don’t carry any fees at all. Whether it’s a monthly fee or a minimum account balance, it’s wise to read the fine print in order to gauge exactly how much you’ll be paying to do business with any particular online bank. You don’t want to sign up with a bank only to find out years later you’ve been paying hidden fees all along. Consider how much you plan on making in the future and let this help you determine which fees are manageable.
While interest rates aren’t the only thing you should consider when shopping for online banks, they certainly carry weight and shouldn’t be overlooked. Carefully evaluating the benefits of high interest rates will give you an advantage. If you plan on carrying a large amount of money in savings, for instance, high-interest savings accounts may serve you well. Weighing these options early on will make deciding on future investments that much more clear.
Long gone are the days of waking up early to head to the bank and conduct your business. Today’s array of trusted online banks makes money management easier than ever, without the long lines and human contact. Not only is it convenient but online banking is a great option if you’re hoping to manage your money on-the-go. With smartphone apps becoming more user friendly by the day, there’s no reason not to always keep track of your spending.
From lower fees to excellent customer service, online banking may be just what you need in order to make your financial health a top priority. If you’ve been on the fence about online banking, know that there are plenty of great options to explore along the way.