Everyone should have a checking account. But not all are created equally.
There are many factors to look at when choosing a bank for your checking needs. Monthly maintenance fees, minimum balance requirements, and other costs of a checking account will need consideration, as well as interest rates and rewards.
We reviewed 45 banks — both online and brick-and-mortar — to find the best ones for your daily money management needs.
Best Checking Accounts of November 2021
Alliant is a Chicago-based, online-only credit union. It’s one of the largest credit unions in the country, with deposits up to $250,000 insured by the National Credit Union Administration (NCUA). As nonprofit institutions, credit unions are often able to offer more competitive account terms than banks. Still, the downside is you have to meet particular criteria to become a member of the credit union.
In the case of Alliant, you have to be a current or retired employee of a company Alliant partners with, a family member of an Alliant member, live or work in the Chicago area, be a member of a qualifying organization, or become a member of Foster Care to Success (FC2S), a non-profit offering educational support to foster teens.
As of October 20, 2020, Alliant offers an interest-bearing checking account with an APY of 0.25%. At this time, it is the highest base interest rate of any checking account we reviewed, excluding the requirements to become a credit union member. To receive this interest rate, you must opt into electronic bank statements over paper statements and set up at least one monthly electronic deposit (e.g., direct deposit, ATM deposit, mobile deposit, transfers from another bank account).
$20 monthly ATM reimbursement
Alliant offers access to more than 80,000 fee-free ATMs in the U.S. The credit union also covers you to use the out-of-network ATMs by reimbursing up to $20 in ATM fees per month. The rebate shows up in your account at the end of each day, so you won’t have to wait too long for reimbursement.
No customer service live chat
If you have any questions, Alliant allows you to contact customer service via phone call, email, and Twitter. It’s not a dealbreaker, but our other picks do have live chat options for customer service allowing you to communicate with an Alliant employee via online messaging system.
Ally is an online-only bank founded in 2009 offering high-yield savings accounts, money market accounts, CDs, loans, and fee-free brokerage accounts. Ally’s interest-bearing checking account is a solid option for those looking to switch their checking to an online bank. The interest rates offered are not at the top of the pack compared to Alliant or AXOS Bank, but they are competitive versus traditional brick-and-mortar banks.
Tiered interest rates
As of October 20, 2020, Ally offers two tiers of interest rates for its checking account: 0.10% APY if your daily minimum balance is below $15,000 and 0.25% APY if it’s above. The APYs are not the highest we’ve seen from online banks, but they are about 10 times higher than what you’d find with a more traditional bank.
$10 monthly ATM fee reimbursement
You can make transactions with your Ally checking account through more than 43,000 AllPoint ATMs across the U.S. and not get charged any ATM fees. However, if you go out of network, Ally will reimburse up to $10 per month in ATM fees.
No cash deposits
Ally offers a generous ATM fee reimbursement policy but unfortunately does not accept cash deposits through ATMs. You can only make deposits through check, online transfers and direct deposit, and wire transfers. If you don’t deal in cash often (for example, if you don’t earn wages in cash), this may not be an issue, but it is a major inconvenience for those who want an Ally checking account to be their primary bank account.
Founded in 1987, Radius Bank is an online-only bank providing checking, savings, money market accounts, CDs, credit cards, loans, and insurance. The Rewards Checking account allows you to earn both interest and cashback and comes with other perks, like early direct deposit and ATM fee rebates.
Radius Bank offers 1% unlimited cash back on all debit card transactions, allowing you to earn rewards on regular everyday purchases. Until December 30, 2020, the cashback rate increases to 1.5% for purchases in particular spending categories, such as drugstores, pharmacies, restaurants, grocery stores, entertainment, and charitable donations.
Early direct deposit
If you work for an employer using weekly, biweekly, or monthly direct deposit, you typically receive your paycheck in your bank account on Fridays. With Radius Bank, you can receive your wages as early as two days before, on Wednesday. This has been a relatively new and popular feature for online banks, such as Chime, Varo, and Simple. While it isn’t a must-have bank feature, it is a nice-to-have, alongside high APYs and cashback rewards.
Minimum balance for interest
To earn interest on your checking account funds, you must have a minimum of $2,500 in your account to qualify for a 0.10% APY as of October 20, 2020. On balances of $100,000 and above, you can earn 0.15% APY. While these are solid interest rates for online checking accounts, these do present a high barrier to entry. None of our other picks require minimum balances to receive interest.
High minimum opening deposit
Similarly, the minimum opening deposit of $100 is another barrier to entry, as not everyone has $100 to start out. If you’re looking for an online checking account with $0 to open, we suggest looking at Alliant or Ally as options.
AXOS Rewards Checking – Best High-Yield Checking Account
AXOS Bank is one of the oldest online-only banks in the U.S. Originally known as Bank of Internet USA, it’s grown to include checking and savings accounts, CDs, mortgages, loans, and managed portfolios among its product assortment. AXOS’s Rewards Checking account stands out in particular because of its higher APY (rivaling even the best high-yield savings accounts), generous ATM reimbursement policy, and lack of fees.
Competitive interest rates
The Rewards Checking account from AXOS offers stacking tiers of interest rates that are the most competitive on the market. As of October 20, 2020, you can earn an APY of up to 1.25%, provided you meet certain account use criteria. To earn interest on the account, AXOS requires you to:
- Receive monthly direct deposits of $1,000 or more
- Make at least 10 transactions per month (min $3 per transaction) using the debit card that comes with the Rewards Checking account
- Make five more purchases per month, for a total of 15 monthly transactions (min $3 per transaction)
Unlimited domestic ATM fee reimbursements
With most banks, you get charged a fee (typically around $3) for using ATMs outside the approved network of ATMs. AXOS’s Rewards Checking Account is one of only a few online-only checking accounts offering unlimited reimbursement of ATM fees within the U.S. Plus, AXOS allows you to deposit cash into your account via ATMs that offer this function. Many popular online banks, like Ally, do not allow cash deposits, so this is beneficial for people who earn wages in cash.
Interest rates not accessible to everyone
AXOS offers strong interest rates on its Rewards Checking account that rival even the best high-yield savings accounts. However, those rates are not offered to everyone. To receive the highest APY, you must be earning at least $1,000 in monthly income (via direct deposit) and putting at least $45 in purchases on your debit card per month. This criteria boxes out people who don’t have jobs that offer direct deposit or who may be unemployed, so consider whether or not you can meet the criteria for these tiers before opening a Rewards Checking account with AXOS.
How We Chose the Best Checking Accounts
Checking accounts are bank accounts that let you pay bills, make purchases with a debit card, write and cash checks, and transfer money. Along the way, you can earn rewards for everyday purchases. Most checking accounts don’t offer rewards the way many credit cards and savings accounts do, but there are a lot of great options among online banks.
NextAdvisor surveyed 1,202 U.S. adults in August 2020 to identify how people were thinking about and using bank accounts in their daily lives. We found that while 89% of banked adults have checking accounts, only 33% of them have accounts with online banks — which are more likely to have competitive rates, lower or no fees, and friendlier account terms.
To help you find your best checking account, we started with a list of the top 25 banks in the U.S. by total assets, as determined by the Federal Deposit Insurance Corporation (FDIC), and added 20 other emerging and established online banks. All banks evaluated are insured for up to $250,000 by either the FDIC or the National Credit Union Administration (NCUA). We then evaluated them based on 13 different factors, including APY (annual percentage yield), rewards offerings, minimum opening deposit, minimum balance requirement, ATM fee policies, and customer service options and availability.
None of the banks we recommend charge any monthly service or maintenance fees. We believe it shouldn’t cost you money to simply have a checking account, so we have only recommended banks that don’t charge such fees. We used an APY of 0.1% as the cutoff for what we consider a high-yield checking account, based on the current rate environment; all picks will have rates higher than 0.1%, though some checking accounts have eligibility requirements for their rates.
The Case For an Online Bank
According to a survey conducted by NextAdvisor, only about 30% of U.S. adults have an account with an online bank. While they’re not as ubiquitous as your most well-known brick-and-mortar banks (think Bank of America and Wells Fargo), online banks offer many benefits. The lack of physical locations means they’re able to pass on the savings to you, the customer, and offer more competitive interest rates and lower (or no) fees. With an online bank, you still get access to wide networks of ATMs, feature-rich mobile apps, and reliable customer service, as well as perks like early direct deposit and ATM reimbursement.
All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 1,202 adults. Fieldwork was undertaken between Aug. 6-7, 2020. The survey was carried out online. The figures have been weighted and are representative of all U.S. adults (aged 18+).
* U.S. adults who have checking, saving, MMA, or CD bank accounts.
Checking accounts are the cornerstone of your daily financial health. Read on for more of our checking account and banking coverage:
- How to Open a Bank Account
- Banking Basics: Why You Need Both a Checking and Savings Account
- What You Should Know if You Are Unbanked Right Now