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For many college students, their default banking option while in school is a student checking account, which is typically free. Unfortunately, when you graduate you lose those benefits. Many student checking accounts will begin to charge you monthly maintenance fees unless you meet certain requirements.
So, where do you go from there?
Few young adults would turn to their parents for fashion or dating advice and, yet, one of the most common ways we’ve found young people choose their bank account is by going with whichever bank their parents already use. This could be a bigger faux pas than stealing your dad’s old pair of parachute pants.
The bank your parents use may carry fees or have requirements that don’t meet your lifestyle or budget, and make accounts expensive to use.
But where do you even begin to choose the right checking account?
When you’re nearing graduation, start planning your bank transition.
Many banks send a letter in the mail a few months prior to your expected graduation date informing you that your student checking account is going transition to a non-student account. If you’re not careful and you disregard the letter, you may be transitioned into an account that charges a fee if you don’t meet certain requirements.
You can always call the bank and ask to switch to a different account or you can choose a new account that offers more benefits, like interest and ATM fee refunds.
Minimum Monthly Balance
Amount to Open
ATM Fee Refunds
|Empower Checking Account||$0||$0||One out-of-network ATM withdrawal per month||1.65%|
|Aspiration Spend and Save Account||$0||$10||Unlimited||1.00% APY|
|TAB Bank Kasasa Cash Rewards Checking||$0||$0||Up to $15 in ATM fees reimbursed||4.00% APY (applies to balances up to $50,000)|
|Orion Federal Credit Union Premium Checking||$0||$0||$10 per month||4.00% (applies to balances up to $30,000)|
|La Capitol Federal Credit Union Choice Plus Checking||$0||$50||Up to $25 per month||4.25% APY on balances up to $3,000|
2.00% APY on balances $3,000-$10,000
The 5 key things you should look for in a checking account
When you’re shopping around for a new checking account, there are several things you should look for to ensure you’re getting the most value from your account:
- A $0 monthly fee: Sometimes banks may say they don’t charge a monthly fee but read the fine print — they may require a minimum monthly balance in order to avoid it. There are plenty of free checking accounts available for you to open, so there’s no reason to stay stuck with an account that charges a monthly fee. Take note, as some accounts may require you to meet certain criteria to maintain a free account like using a debit card, enrolling in eStatements or maintaining a minimum daily balance.
- No minimum daily balance: Accounts without minimum daily balances mean you can have a $0 balance at any given time. This may allow you to have a free account without meeting balance requirements — although other terms may apply to maintain a free account.
- Annual Percentage Yield: APY is the total amount of interest you will earn on balances in your account. Opening an account that earns you interest on your balance is an easy way to be rewarded for money that would typically sit without earning anything. You should definitely aim to earn a decent APY on your savings account.
- ATM fee refunds: You may not be able to access an in-network ATM at all times, so accounts providing ATM fee refunds can reimburse you for ATM fees you may incur while using out-of-network ATMs. Those $3 or $5 charges add up!
- No or low overdraft fees: Most banks charge you an overdraft fee of around $35 if you spend more money than you have available in your account. Therefore, it’s a good idea to choose an account that has no or low overdraft fees.
Top overall checking accounts for college grads
For the top overall checking accounts, we chose accounts that have no monthly service fees, no ATM fees, refunds for ATM fees from other banks, interest earned on your deposited balances and with strong mobile banking apps. While there is no all-inclusive account that contains every benefit, the accounts below are sure to provide value whether you want a high interest rate, unlimited ATM fee refunds or 24/7 live customer support.
1. SoFi Money
Better known for its personal loan products, SoFi has recently launched a cash management account product that offers an attractive yield of 1.80% APY. Unlike some other cash management accounts, the rate applies to the entire balance, with no need to shift funds between checking and spending sub-accounts. Among it’s best perks are unlimited reimbursement of third-party ATM fees, even from overseas withdrawals.
2. Empower Checking Account
Empower is the mobile banking division of Evolve Bank & Trust. The Empower Checking Account currently offers a very attractive 1.65% APY on your full checking account balance, with neither a minimum deposit to open nor any need to maintain a minimum balance. Empower gives you access to over 25,000 fee-free ATMs nationwide, however you’ll only get one out-of-network ATM fee reimbursed per month. One other drawback: There are no check-writing capabilities with this account.
3. Aspiration Spend and Save Account
The Aspiration Spend and Save Account offers a wide range of benefits for account holders and has few fees. The $10 amount to open is fairly low, and once you open your account there is no minimum monthly balance to maintain.
Aspiration charges no fees for withdrawals outside its ATM network, plus it refunds an unlimited amount of third-party ATM fees.
As the account name suggests, there are two sides to the account: a spending sub-account and a savings sub-account. The spending side yields no interest, while the savings side earns 1.00% APY. To earn this APY, you must deposit at least $1,000 in the combined account monthly, or maintain a balance of $10,000.
Top high-yield checking accounts for college grads
Since most checking accounts offer little to no interest, high-yield checking accounts are a great way for you to maximize the money that typically would just sit in your account without earning interest. These accounts often offer interest rates that fluctuate depending on how much money you have in the account. However, in order to earn interest, there are some requirements that you may have to meet such as making a certain number of debit card transactions and enrolling in eStatements.
1. TAB Bank Kasasa Cash Rewards Checking Account
Based in Ogden, UT, TAB Bank’s Kasasa Cash Checking account is a great choice for recent graduates. You can earn a very competitive 4.00% APY by meeting a few simple requirements: Have at least one direct deposit, ACH payment, or bill pay transaction posted to the account during each billing cycle; and make at least 15 debit card purchases. Even better, the bank will reimburse up to $15 in ATM fees per month from making withdrawals outside their ATM network.
2. Orion Federal Credit Union Premium Checking
An excellent choice for recent graduates looking for a high-yield checking account is Orion Federal Credit Union’s Premium Checking account, which promises customers 4.00% APY on balances up to $30,000.
You also need to keep in mind that because Orion FCU is a credit union, you have to jump through some additional hoops to access the high APY:
- Pay $10 to one of five organizations approved by Orion to become eligible for membership in the credit union
- Deposit $25 in a special savings account with Orion to officially become a member
- Make an electronic deposit of at least $500 every month into your Premium Checking account
- Make at least 8 signature based debit card transactions — not PIN-code based debit transactions — each month.
3. La Capitol Federal Credit Union Choice Plus Checking
This checking account has a $2 monthly service fee, which can easily be waived if you enroll in eStatements.
*While the terms state a minimum balance requirement of $1,000 and a low balance fee of $8, the fee can be waived if you make 15 or more posted non-ATM debit card transactions per month.
To earn the top interest rate on your checking balance, you just need to make at least 15 or more posted non-ATM debit card transactions per month. There are numerous surcharge-free La Capitol ATMs for you to use, and after signing up for eStatements you can receive up to $25 per month in ATM fee refunds when you use out-of-network ATMs.