My 5 Favorite Bank Accounts

December 11, 2014

Last week, I wrote about my favorite credit cards for rewards. This week, let’s take on another unpopular financial institution: the bank. With typically poor customer service, rock bottom interest rates, and an endless stream of fees, most people probably look at their bank as a necessary evil. But if you’re willing to look beyond the local branch, there are some good banking accounts out there. Here are my personal favorites: (for the sake of avoiding repetition, all of these banks charge no maintenance or minimum balance fees)

Consumers Credit Union Free Rewards Checking account

Interest rate: as high as 5.09% on up to $20k

Pros: As long as you meet certain requirements, this accounts pays the highest interest rate and even reimburses ATM fees.

Cons: To get the highest interest rate each month, you have to jump through a lot of hoops, including using your debit card 12 times and spending at least $1k on the credit union’s credit card (featured as one of my favorite rewards credit cards). They also only have branches in the Chicago area.

Lake Michigan Credit Union Max Checking account

Interest rate: as high as 3% on up to $15k

Pros: This interest rate is much easier to qualify for since it requires only 10 debit card purchases (plus direct deposit, 4 online banking logins, and eStatements) each month. If you qualify, you also get up to $15 in ATM reimbursements.

Cons: You still have to use your debit card 10 times and their branches are all in Michigan. (What is it with these Midwestern credit unions?)

Smartypig Online Savings account

Interest rate: 1%

Pros: You can create designated savings accounts for goals like a vacation or holiday shopping and get a bonus of up to 11% if you redeem the cash with one of their gift cards.

Cons: It can be cumbersome to withdraw money before you reach your designated goal. You have to either transfer money to the debit card (once per month), transfer it to a different goal or close out the goal completely.

Ally Interest Checking and Online Savings accounts

Interest rate: .9% in the savings accounts

Pros: They reimburse ATM fees in their checking account. Like Smartypig, you can nickname the savings accounts for designated goals but unlike Smartypig, you can instantly transfer savings to your other Ally accounts anytime. You can access customer service 24/7 by phone or via chat on their web site.

Cons: There are no branches.

Capital One 360 Checking and Savings accounts

Interest rate: .75% in the savings accounts

Pros: Like Smartypig and Ally, you can create hassle-free designated savings accounts for goals. There are also no foreign transaction fees and they charge interest rather than  a fee on overdrafts, which is much cheaper. For example, a $30 overdraft for 10 days would only cost 9 cents vs. $31 that other banks could typically charge per overdraft.

Cons: You can’t use Capital One branches and they don’t reimburse ATM fees.

As you can see by my selections, I hate fees, want to earn as much interest on my money as possible, and don’t care much for branches. Do you have a bank account you really like that’s not on this list? Share your favorite(s) in the comments section below.