As a soon-to-be college student, you can be so focused on selecting your classes, messaging your new roommate, and buying dorm supplies that you forget about some of the new responsibilities heading your way.
One of the big ones is banking. If you haven’t found a bank and opened a checking account yet, you should plan to do both before you head to campus. Your first instinct may be to open an account with a bank you are familiar with or to keep your hometown bank account, but that might not be the right fit for you as a college student. Having an accessible physical bank branch may be important to you if you anticipate needing to do in-person banking—for example, if you’re receiving cash for rideshare tips or tutoring gigs regularly. If you don’t use a physical branch now and don’t see that changing once you’re on campus, then that is less of a requirement. Knowing your goals and how you’ll use your bank can be the first step in assessing which bank is right for you.
What to Look for in a Bank
Positive Online Reviews
You might assume it’s better to go into a bank and speak with someone directly, but online reviews can be beneficial in comparing details about different bank options. Check out J.D. Power’s rankings on banking satisfaction. You can also use Google or Yelp to find customer service reviews of different banks. It can be helpful to talk to your peers too. Who do they bank with? What do they like and not like about the bank they are using? What bank branches or ATMs are conveniently located on or near campus? This initial research can help guide you to the best bank for your needs.
Digital Capabilities
You do everything else online, so it only makes sense to do your banking online too. Think about whether you want a brick-and-mortar experience, an online experience, or a bit of both, and check out what account tools are available for the banks you’re considering. A couple things to look for:
- Automatic bill payments.
- Digital transfer capabilities.
- The ability to deposit checks online.
- An app that allows you to perform account maintenance, including turning off your debit card if it’s lost or misplaced.
The student lifestyle isn’t traditionally amenable to typical banking hours, which makes it especially important to find a bank that lets you access your money on your schedule.
FDIC Insured
Make sure any bank you choose is FDIC insured. The FDIC (Federal Deposit Insurance Corporation) provides deposit insurance so in the unlikely event your bank fails, you won’t lose the money you’ve invested with them, up to the maximum allowed by law. This is a non-negotiable feature and solid advice for banking decisions throughout your life—not just when you’re a student. If a bank is FDIC insured, then it will be indicated on the bank’s website or at a branch.
What to Look for in a Checking Account
Student Checking Account Options
Some banks offer promotions for college students as well as the option to open a student checking account. This may include a welcome bonus, provided you follow certain guidelines, such as keeping a monthly minimum. While welcome bonuses can be enticing, be sure that the bank makes sense for your overall financial goals.
And just because you’re a student doesn’t necessarily mean you need to open a student checking account. While some student checking accounts have perks, such as no fees, you may have more options and services with a “traditional” bank account, like cash back rewards or deposit availability that gives you quicker access to your money. Thinking about your needs can help you assess which type of account is right for you.
No Balance Minimums
Some banks require that you maintain a minimum balance in your checking account, which is the lowest dollar amount you must keep in the account to avoid a fee. If you have trouble maintaining the balance, you will be charged and some banks may even close your account after too many violations. But some banks offer checking accounts designed for college students—these usually don’t have minimum balance requirements and may have additional benefits, such as overdraft protection. Research your options. Even if you open an account with money you’ve saved, keep in mind that plans can change and unexpected costs may come up, which can make maintaining a minimum balance a burden.
No Costly Fees
Checking accounts can come with a variety of fees that can really add up. Fees include charges for monthly account maintenance, ATM withdrawals, overdrafts, transfers, and sometimes even paper statements. You should understand what fees are associated with the accounts you’re considering and if it’s possible to avoid them.
It can also be helpful to learn what will happen to your account when you graduate from college. If you have a student account, will it change to a traditional checking account? Will that also change the terms of your account such as fees or minimum balance requirements? Looking at what traditional checking accounts offer can also help you inform your decision once you graduate.
Convenience and Location
You may rarely use cash nowadays, but access to cash is still important. Some banks charge fees for ATM withdrawals when you use locations that aren’t associated with that bank. Finding a bank with accessible ATMs to your campus, where you travel, and where you spend your school breaks will help you avoid regular (and costly) withdrawal fees. If study abroad plans are in your future, you also may want to compare international transaction fees, and find a bank that has low or no charges if you take out money or use your debit card to make a purchase.
Ultimately, the bank you choose for checking and savings should make your life as simple as possible. Getting recommendations, knowing your needs, and opening an account that makes sense for your college life not only can make your life less stressful, but it can also save you money in the long run. Taking the time to do some research before you get to college can be a smart step toward good money habits in the future, too.
