Is a Big Bank The Right Choice for You?

by Jason Unger

It’s incredibly easy to dislike (and make fun of) the biggest banks in the country — and often for very good reasons.

They don’t care about you – they just care about their profits. They don’t make it easy for you to save money – they just want you to spend money and take out loans. We could go on and on.

But there are some legitimate reasons why you may want to bank with a big bank. For as much as we talk about everything wrong with Bank of America, I still have an account there — simply opened because they had the most ATMs where we lived.

That’s one of the few reasons why banking with a big bank may make sense for you, says GoBankingRates:

You need access to ATM locations wherever you go
The big difference between the big banks and your local community bank is the geographic footprint. Bank of America has thousands of ATM locations all across the nation. Your local community bank probably has a dozen. A much larger regional bank might have a thousand.

You are reliant on top-of-the-line banking technology
When it comes to online banking , your local credit union or community bank usually has trouble keeping up with the offerings of online banks and national banks. It’s simply a matter of scale — your community bank won’t serve nearly as many customers as online or national banks, so it’s unable to devote as many resources to building a sophisticated online or mobile banking experience.

Interest rates are a big concern
Here’s where picking the right “big guy” matters. Online banks are run by the big boys and these low-overhead banks might offer much higher interest rates than even your local credit union. It’s a matter of scale and overhead — online banks don’t need to operate branches, which are often expensive, and cut expenses in other ways (all electronic, fewer staff) so they can offer you a more competitive rate.

So here’s my caveat for this. Just because you have an account with a big national bank doesn’t mean you should do all of your banking there — in fact, it’s just the opposite.

You’ll be peppered with incentives for using multiple bank products, but it’s rarely worth it. Keep you checking account at a big bank for easy access to money, work with a local credit union or community bank, get a mortgage from the best available offer, and track it all with an account aggregator.

Having an account with a big bank may make sense for you — but not doing all of your banking there does.

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