Checking Accounts

Late last year the bank I had my personal checking account with was taken over by the FDIC and sold to another bank.  FYI, the transition from a customer perspective was seamless.  The new bank is now changing the terms of the account prompting me to shop around again.

I thought I would share some of my findings. First there are the features you might care about

• interest rate
• free checks
• atm reimbursement
• nearby full service branch (e.g., notary)
• remote deposit (scan check at your computer)
• online bill pay
• download into Quicken
• minimal hold times for deposits
• fees

As you might expect, no institution excels at all of these.

A new form a checking that has arrived in the last few years is reward checking.  These often have requirements of direct deposit, electronic statements, a certain number of debit card transactions each month (e.g., 10-15/mo) and sometimes a HELOC.  In return for meeting these requirements they will pay 3% to 5% interest on your checking.  They typically have a limit of $25K to $50K that you can deposit and earn this interest.  For example, locally we have Aloha Pacific FCU which offers 4.5% on checking balances up to $50K if you have all of the following (direct deposit, estatements, HELOC, and 10 debit transactions each month).  For very disciplined souls who can keep close to the maximum balance in the account, these can be a good deal.  Tracking the 10 debit transactions each month is the deal breaker for me, making it too high maintenance.