What Kind of Bank Should I Choose?
Banking and Commercial banks
There are a lot of great choices out there for your banking needs. Its good to know the benefits of the choices available, as well as the down side if any. The more you know, the more you are informed and can keep more of your money.
Commercial banks are everywhere it seems, and they serve both individuals and businesses alike. You can usually find multiple branches in easy to find locations. They offer the full range of banking services. There are often fees for checking account services and other fees as well. Sometimes these fees are among the highest in banking institutions but have come down in recent years. Ask around for what you will be using the most at your local commercial bank. Sometimes, the service can be impersonal, but this too, has had to change in recent years because people still like personal service. Your deposits will be FDIC insured most likely for up to 100,000 dollars. The biggest help I have found is to ask any and all questions up front, and ask for recommendations from friends and family too. Do your research, as I know our family has found some great banks offering great deals on their checking accounts, for instance.
I would highly recommend Credit Unions to anyone that has access to one. Because Credit Unions are usually not for profit, they can pass on those savings to you. Therefore, their fees may be lower than at commercial banks, and their interest rates are sometimes better as well. I was part of a credit union with my first checking account, and loved that experience while I was with that company. (It was Nordstrom, I worked in the Corporate Offices and they had a credit union on site.) They helped me to finance my first car, and automatic deposits, gave great advice, etc. Credit Unions have been given a great name over the years, and I think it is just due to how they conduct their business.
Savings and Loans or S&Ls
My very first savings account was at a Savings and Loan. I was just a little girl when my grandmother took me down to open it up, and I was very proud to have my very own record of deposits and interest earned, etc. I love the whole idea, and it made me feel very grown up. To this day, I appreciate a bank that is friendly to kids and encourages them to be wise with their money and make banking a pleasurable first experience.
The fees at a Savings and Loan may be lower than at commercial banks which is a plus. The smaller banks especially, tend to have great service. Most are FDIC insured, of course. It used to be they required a notification of certain withdrawals, so you might ask about this. Since some branches aren't as plentiful as commercial banks, the ATM machines may be a bit more scattered, but some don't need the use of ATM machines hardly ever, so it may not be a big deal.
Mutual Funds, Brokerage Firms, etc.
Whether Insurance Subsidiaries, brokerage firms, or mutual funds, you will find they offer limited banking services. The checking is usually low cost to free, and is linked to interest paying money market funds. Brokerage firms sometimes provide for loans against investment balances, etc. You need to know they often require larger minimum balances than other financial institutions. While many are not FDIC insured, they may have private insurance instead so that is something to ask about.
Private banks often provide a full range of individualized financial services and banking for their clients. Sometimes they are referred to as private banking departments and a personal representative often handles all your banking needs. This includes authorization for loans, etc. The services can vary of course from bank to bank, and you often need to be rather "well to do" to even qualify for the full range of services. Often there is a minimum annual fee and an expectation to generate a certain amount of business.
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