Despite the fact that online banks tend to offer more competitive rates of interest than “brick and mortar” banks, you may prefer — or may also have need for — a physical bank that has “real” people that can help you with your financial needs.
Here are some important factors to consider:
Accessibility: Is the financial institution close to your home, school, work, etc.? How convenient are its hours? Other accessibility factors could include: ample parking, a drive-up window, automated teller machines (ATMs), outlying branches, internet banking, bill paying services and mobile banking.
Annual Percentage Rate (APR): When shopping for consumer loans for the purchase of items like cars, boats, and homes, it pays to find the lender offering the lowest APR. The difference of ½ of one percent on a mortgage loan can equal thousands of dollars of savings over the term of that loan.
Annual Percentage Yield (APY): The term Annual Percentage Yield (APY) represents the, percentage rate reflecting the total amount of interest paid on an account, based on the interest rate, and the frequency of compounding for a 365 day period. APYs make comparison shopping for savings accounts and CD’s much easier. Simply select the highest yield or APY.
Service: If you already have an account ask yourself, “Are the employees of the financial institution friendly? Professional? Knowledgeable? Accurate? Do I waste too much time in long teller lines?” For comparisons, ask friends and relatives about the service quality at their financial institution.
Service Charges: These fees vary widely from institution to institution! Savings accounts can have minimum balance requirements, monthly fees for not keeping that balance, or no fees/balance requirements at all! Checking accounts may have monthly fees, per check fees for items both written and deposited, overdraft charges for “bouncing” checks, etc. There may be fees for ATM transaction, bill paying services or mobile banking transactions.