Sick of being Charged to Death at your BanK? Try a Free Online Checking Account
It's like that time I went to buy my daughter a bicycle; it was advertised at $1500. But when it came time to actually paying the bill, it came to more than $1800. They said that when I first asked for a bicycle, did I say I needed a seat and pedals? Didn't everyone know that those were optional extras? Free checking accounts seem to have been around forever. But as we all know, what they call "free" is only believable usually, if you're hopped up and sky high. Most people have a normal banking life; at one time or another, they've been to a real physical bank, and they opened a checking account that was claimed, to be free of fees and add-ons. How misleading that turned out to be! Apparently, "free" has a very limited definition with the banks, and after people got hit with all kinds of new rates and fees, and offhand treatment, people are beginning to wonder if the advertisements that promise a free online checking account with a nonphysical bank, a place like an online bank or brokerage, may bemay be the same thing all over again.
They really could make sense; physical banks bleed you for ATM withdrawal fees, low balance penalties and maintenance charges around the clock that it has to be refreshing to have an account with ING Direct, or Charles Schwab or Fidelity investments - any of the online majors. They have no low balance restrictions, there are no maintenance fees, checkbook fees, or fees for ATM use - even in another country. And if you overdraw your account, again there is nothing they can do to you. If you look at the traditional banking setup, hitting you with overdraft charges - as much as $35 for going overboard by as little as $2 - appears to be their main business model. They look over your expense list, and rearrange everything so that they can make it look like you've overdrawn your account as many times as possible. The ATM fee is the worst - about $2 each time you withdraw your own money. It's not like you would be losing much by way of interest with a free online checking account either. They offer less than 1% on balances lower than $15,000, but the physical banks are no prize either.
Online entities that offer free online checking accounts like ING Direct, try to persuade people to try the new way in banking, promising you that you speak to a real live bank representative in less than 20 seconds of picking up the phone. And people are listening. They have had twice as many customers this month, as in the last. Still, there are a couple of hassles with going the free online checking account route. Where would you deposit a check for instance? You can only go mail your check in, and wait for the inevitable postal delay. They are thinking up new ways for these over time. You could scan to check and send the image if you have an iPhone, for instance. You get a better deal with an online one, than with a physical one. The traditional bank is certainly going to have to up its game.