How to Choose a Bank: 9 Most Important Things to Consider

Choosing a bank is one of the most important financial decisions you’ll make. The right fit depends on how you manage your money day to day and what you value most—convenience, savings potential, or personalized service.

This guide walks through nine practical factors to help you find a bank that meets your goals. From digital tools and safety features to fees and customer experience, you’ll learn what to look for so your money works as efficiently as you do.

Table of Contents

1. What to look for in a bank: 9 factors
   1. 1. How you plan to use your money
   2. 2. Types of transactions you’ll make
   3. 3. Importance of in-person services
   4. 4. Tools and digital features that make banking easier
   5. 5. Interest rates, fees, and account requirements
   6. 6. Types of financial institutions
   7. 7. Deposit protection and account security
   8. 8. Customer service and relationship quality
   9. 9. Value-added perks and features
2. How to compare banks
3. How to pick a bank for you
4. FAQ
   1. How do I choose a checking account?
   2. How to choose the right bank accounts?
   3. What’s the transfer process look like once I find a new bank?
   4. What are the best banks for young professionals?

What to look for in a bank: 9 factors

Finding the right bank starts with knowing what matters most to you. The best choice depends on how you use your money, the features you rely on, and what kind of service you prefer. Use these nine factors as a guide to compare banks and find the best fit for your needs.

1. How you plan to use your money

Start by thinking about your financial goals and how you’ll access your money. Do you mostly use your account for everyday spending, or are you setting aside cash for savings or long-term goals? Your answer shapes which types of accounts make sense.

Different types of deposit accounts serve different purposes. Knowing how each works can help you decide where your money belongs:

• Checking account: Used for daily spending and payments. Ideal for direct deposits, debit card purchases, and paying bills.
• Savings account: Designed for short-term savings you might need to access easily.
• Certificate of deposit (CD): For funds you don’t need right away. CDs typically offer higher, fixed returns in exchange for keeping your money locked in for a set term.

Once you know which account types fit your needs, you can start comparing financial institutions. For instance, some banks, such as Capital One and SoFi, offer high-yield savings accounts with competitive rates and user-friendly digital tools.

2. Types of transactions you’ll make

Think about how you use your bank on a typical day. The right account setup depends on the types of deposit account transactions you make most often—whether that’s direct deposits, paying bills, or even withdrawing cash.

Common bank account transactions include:

• Direct deposits from your employer or government benefits.
• Online bill payments for utilities, credit cards, or subscriptions.
• Debit card purchases in stores or online.
• ATM withdrawals or deposits for cash access.
• Wire transfers or peer-to-peer payments for sending money.

If you often use ATMs or make frequent transfers, look for a bank that offers broad ATM access and low transaction fees. For digital users, features like mobile check deposit and instant transfers can make everyday banking faster and easier.

3. Importance of in-person services

Even with online banking’s convenience, some services are still easier face-to-face. Tasks like depositing cash, getting documents notarized, or accessing a safe deposit box often require visiting a branch.

If you handle cash regularly or prefer personal guidance, look for a bank with nearby branches and flexible hours. A strong local presence can also help if you ever need to resolve an issue quickly.

For others, branch access may not be essential. Online-only banks typically offer higher interest rates and lower fees, trading in-person convenience for digital efficiency. The best choice depends on how much you value direct interaction and local service.

4. Tools and digital features that make banking easier

Strong digital tools can make managing your money much more convenient. Most banks now offer mobile deposits, online bill pay, and direct deposit setup, but the quality and ease of use can vary widely.

Before opening an account, explore the bank’s mobile app and online dashboard. Look for features like real-time transaction alerts, budgeting tools, and credit monitoring. These extras can help you stay on top of your finances without extra effort.

If you often travel or manage multiple accounts, check whether the bank integrates with digital wallets or personal finance apps. Good technology shouldn’t just make banking faster—it should make it smarter.

5. Interest rates, fees, and account requirements

Interest rates and fees can make a bigger difference than you might think. Small percentage changes or recurring charges add up over time, affecting how much you actually earn—or keep.

Compare account fees and options carefully. Look at maintenance fees, overdraft charges, ATM fees, and foreign transaction costs. Some banks waive fees if you meet a minimum balance or set up direct deposit.

Also review interest rates for both checking and savings accounts. While traditional banks may offer lower rates, online banks often provide higher yields with fewer restrictions. The goal is to balance cost, flexibility, and return.

6. Types of financial institutions

Before opening an account, it helps to understand the types of financial institutions. Each offers different strengths—from technology and convenience to personal relationships and community focus. 

Knowing the differences can help you choose the kind of banking experience that fits your lifestyle. Some of the most common types of financial institutions include the following: 

• Large national banks: These banks operate across multiple states and serve millions of customers. Some of the largest banks in the world—like Wells Fargo, JPMorgan Chase, and Bank of America—fall into this category. They provide a full range of products with widespread ATM and branch access.
• Regional and community banks: You can find regional and community banks across the country. They generally focus on local customers and may offer more personalized service. They can be a strong choice if you value relationships, community involvement, and local decision-making.
• Credit unions: Member-owned and not-for-profit, credit unions usually offer lower loan rates and fewer fees. Membership may be limited to specific groups, employers, or geographic areas.
• Online-only banks: These operate entirely digitally, often providing higher interest rates and fewer fees since they don’t maintain physical branches. They appeal to customers who prefer managing finances through mobile apps or online platforms.
• Neobanks: These organizations are digital, nonbank entities that offer financial services similar to a traditional bank. They provide features like checking accounts, debit cards, and mobile payments through user-friendly apps. Some may partner with chartered banks to offer FDIC-insured deposits. Chime is one example.

Each type of financial institution has trade-offs, so think about what matters most—personal service, accessibility, or cost—before choosing where to bank.

If you value one-on-one support and local decision-making, a community bank or credit union might be the best fit. If you prefer advanced technology, nationwide access, or a full range of financial products, a national bank could serve you well. 

And, if low fees and convenience are your priorities, an online bank or neobank might be right for you.

7. Deposit protection and account security

Keeping your money safe should be a top priority when choosing a bank. Your protection comes from two main areas: federal deposit insurance and digital security measures that guard your personal information.

Banks and credit unions typically offer:

• Deposit insurance: Generally provides insurance up to $250,000 per depositor, per institution. This coverage protects your money even if the bank fails. The FDIC insures banks, and the NCUA insures credit unions. Before opening an account, confirm that your deposits are insured.
• Strong account security: You can expect reputable financial institutions to use security features such as multifactor authentication, encryption, and fraud monitoring to detect and prevent unauthorized activity.

When comparing banks, review both their financial health and their approach to customer protection. Choose trusted and financially sound banks that maintain transparent safety and performance records. 

Reputable financial institutions like Capital One and Barclays are known for robust security systems and regulatory oversight, helping you bank with greater confidence and peace of mind.

8. Customer service and relationship quality

Good customer service can make a big difference in your banking experience. Look for banks that are easy to reach, responsive, and transparent when problems arise. 

Building a relationship with your bank can also pay off over time, especially if you need help with loans or financial planning. Strong service builds trust and ensures you’re supported when you need it most.

9. Value-added perks and features

Beyond standard account options, some banks and credit unions offer features that add extra value. These may include cashback rewards, sign-up bonuses, or early access to direct deposits.

Many institutions also provide budgeting tools, credit monitoring, or special lending programs like payday alternative loans, which can help borrowers avoid costly short-term debt.

When comparing these extras, focus on lasting benefits that align with your goals rather than limited-time offers. The best perks make banking easier and more rewarding over the long term.

How to compare banks

No single bank excels in every category, so the best choice of bank depends on what you value most. Use the nine factors in this guide to compare convenience, cost, and trust side by side.

As you narrow your options, weigh the pros and cons of each institution’s features, fees, and accessibility. Sometimes a smaller bank offers better service, while a larger one provides broader tools and reach.

Evaluating your banking options thoughtfully can help you find the right balance between technology, security, and personal connection.

How to pick a bank for you

The right bank should fit your financial habits, goals, and comfort level. As your life changes, your banking needs may change too, so it’s worth reviewing your accounts periodically to ensure they still align with how you manage your money.

If your current bank no longer meets your expectations, exploring other banking options can lead to better rates, lower fees, or improved service. Choosing a bank isn’t just about where you store your money—it’s about finding a trusted financial partner that supports your goals over time.

FAQ

How do I choose a checking account?

Start by looking at how you’ll use the account day to day. If you like digital banking, look for a bank with a strong mobile app and easy online transfers. Compare monthly maintenance fees, minimum balance requirements, and ATM access. It’s also smart to check for perks like early direct deposit, overdraft protection, and fee-free networks.

How to choose the right bank accounts?

Think about your short- and long-term goals. A checking account is best for everyday spending, while a savings account helps you build an emergency fund or reach specific goals. Compare interest rates, fees, and how easy it is to move money between accounts. If you prefer all-in-one management, look for a bank that offers both with linked transfers and a single login.

What’s the transfer process look like once I find a new bank?

After opening your new account, update your direct deposits and recurring payments to the new bank. Most banks make it easy to move money with online transfers or by linking your old account. Keep both accounts open for at least one or two billing cycles to make sure all automatic payments clear correctly before closing the old account.

What are the best banks for young professionals?

The best banks for young professionals usually offer low fees, mobile-first tools, and features that support growing finances. Online banks like Ally or SoFi are known for convenience and high savings rates, while traditional banks like Chase or Bank of America may be better if you need in-person service. Credit unions can also be great options for competitive rates and personal service.