As banks and credit unions introduce new technology to help you manage your money, fewer people are interested in walking into a branch. In fact, nearly 70 percent of millennials use mobile banking, according to a study by the Federal Reserve.
Compared to traditional banks, the best online banks usually offer better annual percentage yields (APYs) or interest rates on account balances as well as lower fees. If you’re looking for the best online bank account for you, consider our top five favorites.
Ally Bank makes the list of best online banks because of its low fees, high APYs, and available customer service.
Interest: Ally’s savings account has a flat 1.05% APY for all balances.
However, the amount you earn on your checking account balance depends on how much you have deposited. Balances of up to $14,999.99 will get a 0.10% APY, and balances of $15,000 or more will get a 0.60% APY.
Fees: Ally Bank’s checking and savings accounts are largely fee-free.
You won’t pay a monthly fee or fees on Automated Clearing House (ACH) transfers to other banks. Ally also doesn’t charge for standard check orders or cashier’s checks.
Ally will even reimburse you up to $10 a month for ATM fees from ATMs outside the Allpoint network.
If you opt for Ally’s overdraft transfer service, which pulls money from a savings account if you overdraw, there’s no overdraft fee. Otherwise, you’ll pay $25 per overdrawn transaction, with a maximum of one fee per day.
Transfers: If you’re not sure you want to give up your traditional bank entirely, Ally allows you to make ACH transfers to and from other banks for free. ACH transfers typically take three business days, but some are eligible for a one-day transfer.
Although you won’t pay a fee for incoming wire transfers, it will cost you $20 to send a domestic wire transfer (international wire transfers aren’t available).
Deposits: You can deposit checks via Ally’s mobile app only. The bank doesn’t allow cash deposits, but you can set up direct deposit for your paychecks.
Customer service: Ally’s customer service team is available 24/7, and you can even speak with a representative via live chat.
Multiple savings accounts: If you’d like to have a separate savings account for each of your money goals, Ally allows you to create as many as you want.
The Aspiration Summit checking account has some perks that are hard to beat, making it one of the best online banking options out there.
Interest: What makes the Aspiration Summit checking account stand out is its APY, which is high for this type of account. You’ll earn a 0.25% APY on balances up to $2,499.99 and a 1.00% APY on balances of $2,500 or more.
Fees: For basic usage, you’ll likely avoid fees altogether. Aspiration charges no monthly fee, and the bank will reimburse you for any ATM fees you incur. That means you can use any ATM worldwide fee-free.
Aspiration does charge fees for other services, though. For example, wire transfers, money orders, and overdrafts over $5 all incur fees. You also will be charged a $5 daily overdraft fee for every day your account is overdrawn.
There is, however, a five-day grace period, which means you have five days to get your account in the positive again before the daily overdraft fee starts.
Make sure to review Aspiration’s fee schedule before applying for a checking account.
Transfers: Aspiration allows you to do ACH transfers, which usually clear within two business days.
Deposits: You can deposit cash or checks to your Summit account at specific ATMs in the NYCE ATM network. You also can deposit checks via Aspiration’s mobile app and set up direct deposit.
Customer service: If you have general questions, you can peruse Aspiration’s support page to find answers. If you’re still stuck, you can reach the customer service team via live chat, email, or phone or by submitting a request.
If you’re looking to keep your checking and savings accounts with one bank, Bank5 Connect may be your best online banking option.
Interest: Bank5 Connect offers high interest rates on its checking and savings accounts. You’ll get a 0.76% APY with the checking account and a 0.90% APY with the savings account.
The minimum balance of $100 per account isn’t hard to meet, either.
Fees: For basic services, you don’t need to worry about fees. Bank5 Connect doesn’t charge a monthly fee or fees for cashier’s checks, incoming wire transfers, or overdraft transfers from savings. Also, its $15 overdraft fee is well below the average of $30.
Transfers: Bank5 Connect allows you to transfer money to and from other banks via ACH transfers. Transfers typically take three business days.
Deposits: To add money to your Bank5 Connect account, you can deposit checks via your mobile app, send checks to deposit via snail mail, or use direct deposit.
Customer service: If you need help with your account or have a general question, you can reach Bank5 Connect by phone or live chat or by submitting a request via a contact form.
Capital One 360
Formerly ING Direct, Capital One 360 offers an impressive array of features, easily making it one of the best online banks.
Interest: This is one area where Capital One 360 lags behind some of the others. Unless you deposit a boatload of money, you won’t get much from the checking account.
- 0.20% APY on balances up to $49,999.99
- 0.75% APY on balances from $50,000 to $99,999.99
- 0.90% APY on balances of $100,000 or more
The bank’s savings account APY is more impressive at 0.75%, and there is no minimum balance required.
Fees: Like most of the other best online banks, Capital One 360 doesn’t charge fees for most everyday uses. There’s no monthly fee or ATM fee for withdrawals from ATMs in the Allpoint network.
You will, however, pay a whopping $20 for a cashier’s check and $5 for checks after your first order, among other fees.
Transfers: Capital One 360 allows you to transfer to and from other banks for free. Transfers usually take two business days. The bank doesn’t charge a fee for incoming wire transfers, but outgoing domestic wire transfers cost $30. You can’t send international wire transfers.
Deposits: Capital One offers more options for deposits than any other online bank listed here. Of course, you can deposit checks via your mobile app. Plus, if you live near a Capital One 360 Cafe or bank branch, you can deposit checks or cash via a teller. You also can set up direct deposit.
Customer service: Unlike other online banks, Capital One 360 doesn’t offer live chat. You can reach its customer service team by phone only.
Multiple accounts: Like Ally Bank, Capital One 360 believes in using multiple savings accounts to work toward different savings goals. You can have up to 25 savings, money market, and business savings accounts with the bank at a time. You also can have up to three checking accounts.
Referral program: If you like what you see, Capital One 360 rewards you for sharing it with your friends. You’ll earn $20 per referral when someone opens a checking or savings account as a new customer. You can receive up to $1,000 total.
Overdraft protection: If you want to avoid getting charged a fee every time you overdraw your account, you can opt for an overdraft line of credit. That way, you’ll be charged interest on the overdrawn amount until you bring the balance above zero again.
In most cases, you’re paying pennies. And if you replenish your account the day it’s overdrawn, you won’t pay any interest at all.
If you don’t want this option, you can have Capital One 360 automatically transfer money from a savings account to cover an overdraft.
Discover offers great products across the board, so it’s no wonder it offers some of the best online bank accounts.
Interest: Discover’s savings account offers a 1.10% APY, with no minimum balance required. Discover’s checking account doesn’t offer any interest earnings, but it does offer rewards. More on that below.
Fees: There is no monthly fee for the checking account. The bank also has more than 60,000 fee-free ATMs in its network. You won’t pay anything for standard check orders, either.
Discover’s overdraft fee is $30, but the bank limits the fee to once per day.
Transfers: You can move money to and from your Discover account via ACH transfers. Transfers usually take four business days.
You can receive incoming wire transfers to your Discover account for free, but there’s a $30 fee for outgoing wire transfers.
Deposits: You can deposit checks into your checking or savings account via the Discover mobile app. You also can add money to your account via direct deposit.
Customer service: Discover is well-known for its outstanding customer service. For example, J.D. Power has ranked the bank highest in customer satisfaction with credit card companies three years in a row. You can reach Discover by phone or live chat or through a secure message.
Rewards: Checking account rewards are hard to find, but Discover is impressive in this regard. You’ll earn 10 cents for every qualifying transaction you make – up to 100 transactions per month. Eligible transactions include debit card purchases, online bill pay, and cleared checks.
If you max out the rewards cap every month, you can earn $120 a year in rewards.
Which of the best online banks should you choose?
The best online bank account for you will depend on a few things.
For starters, ask yourself what you plan to do with the account. For example, if you travel a lot, the fact that Aspiration Summit offers unlimited ATM fee reimbursements is appealing.
Next, consider how much money you plan to keep in the account. If it’s not much, the APY may not matter as much as other features. If you plan to use one of these online banks for your main checking and savings accounts, though, you may want to go with one that offers higher checking and savings APYs.
Compare each of these accounts with other checking and savings accounts to make sure you’re getting the best features for your needs. Getting the right one the first time can save you time and money later.
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