Checking accounts are about as basic as financial products get. You probably already have one, and if you don’t, you probably should: you need one to access most other services. Just because they’re basic, though, doesn’t make them all equal. Odds are that if you’ve had the same checking account your whole life, you’re getting a sub-par best interest rate, paying too many fees, or dealing with outdated technology. There are a lot of options for checking accounts out there, though, so what should you look for to make sure you get the best one?

Comparison shop: cast a wide net, but read the fine print

When you’re looking for a checking account, look at as many options as you have time for, then narrow it down from there. Don’t pick the first product you see, and don’t trust recommendations from just one source. Just because a bank shows up first on Google or gets a positive mention in a blog post isn’t a guarantee that they’re the best. Good marketing doesn’t equal good products, and might even be covering up some unfavorable conditions hiding in the fine print. Before you settle on an account, make sure you’re really getting the best deal.
Since there are so many options available now, looking through all of them and deciding on the best one can be a time-consuming process.

Fees: don’t pay them

Checking accounts are not complex financial products and they don’t pay great interest rates, so an account with high fees really isn’t worth it when there are so many free and low-fee options. Fees to watch out for in the large and fine print include:

  • Account maintenance: Some banks charge you a maintenance fee for managing your account, usually per month. This is getting less common, though, and unless you have a good reason, it’s best to avoid these types of accounts.
  • Minimum balance: This fee is meant to ensure you keep a certain minimum amount of money in your account to justify the expense the bank incurs by having you as a customer. If you fall below the minimum, they can charge you some pretty steep fees.
  • Overdraft: Most banks will automatically approve purchases you make, even if you don’t have enough money in your account to cover the purchase. This service comes with a pretty steep fee, though, so if this could potentially be an issue for you, look for a bank with a favorable overdraft policy.
  • ATM fees: At minimum, your checking account should offer free access to a network of ATMs. If you often find yourself travelling and in need of cash, though, try to find a bank that will refund any out-of-network ATM fees you may incur. Some banks even offer this service to international travelers.
  • Foreign transaction fees: If you don’t spend much money internationally, this won’t be a problem for you, but if you do travel, be aware that many banks charge flat fees or percentages for foreign transactions.

Having a low-interest but fee-free checking account is often a better option than a fee-heavy account with higher interest. This will depend on your personal needs, of course, but there are a lot of fee-free options out there, so unless you’re certain it will save you more money than it costs in fees, your default should be a simple, free checking account.

Interest Rates: don’t expect much, but aim high

First of all, you shouldn’t keep all your money in checking. That’s because:

  • checking accounts pay some of the lowest interest rates of any financial product, and
  • if your debit card information gets stolen, the thief can take the money right out of your account, potentially leaving you liable for up to $500 if you don’t report the theft within two days.

That said, you should have enough money in checking to cover your regular expenditures, as well as some extra just to make sure that you don’t go into a negative balance and incur overdraft fees. As long as your money is sitting somewhere, it might as well be accruing interest, so finding the highest possible APY is a good place to start looking for accounts. Just watch out for any hidden drawbacks, like high fees, and make sure that the high interest rate isn’t just a temporary promotion.

Convenience/Technology

Depending on your needs, your standards for what makes a bank “convenient” will vary. If you routinely handle cash and checks or you prefer in-person customer service and transactions, a bank with a lot of physical locations and/or ATMs will probably be important for you.

Traditional brick-and-mortar banks typically have lower interest rates and higher fees, though, and might not offer the best tech experience. If most of your transactions take place on cards or over the internet and you’re comfortable dealing primarily with an online interface, you’ll probably find online banks more attractive.

If you’re looking for money management features, like special saving tools and spending trackers, online banks are more likely to offer them. “Neobanks,” a new breed of mobile-only, low-interest, low-fee banks are especially active in this sector, offering a minimalistic range of products with powerful interfaces.

Steps for choosing your account

  1. Think about your banking needs. Do you primarily bank online, or do you handle lots of cash and checks? Are you a frequent traveler? A small-business owner? Do you need help saving?
  2. Check on the bank’s fee structure. Most people will be best served by a free checking account, and lower fees are always better. Finding low or no-fee accounts can often save you more than you might gain from a high-fee, high-APY account.
  3. Find the banks offering the highest interest rates. Check to make sure it’s not just a promotion. The rates on checking accounts are quite low, so any money you don’t need for your regular expenditures should be in a higher-interest account.
  4. Decide if an online-only bank is right for you. They generally offer better interest rates and lower fees. Brick and mortar banks, credit unions, and neobanks can also be good options.

There are plenty of tools online to help you compare bank offers. Using them is a great way to find new products, but back up their results with your own research. Also, keep in mind that opening a new checking account is generally easy. As long as you have a decent financial history, you’re unlikely to be denied. If you see a better deal on an account than the one you currently have, signing up for it and moving your money over is a fairly straightforward process. Opening a checking account is most often just a soft pull on your credit, so it most likely won’t affect your credit score. A good checking account keeps your money safe, gives you easy access, doesn’t charge high fees, and ideally earns you a little return on your deposit.