EP 108: Smart + Frugal Banking | Best Online Banks + How to Choose One

EP 108: Smart + Frugal Banking | Best Online Banks + How to Choose One

We all have to put our money somewhere, but how do we decide the best banking solutions? On this episode we explore whether an online bank is right for you, if credit unions live up to all the hype, and if you do choose multiple accounts how you should organize your money in them. We’ll also go through our recommendations for the best banks with no or low fees!

Sponsors: 

  • Current: is a mobile bank with an awesome user interface, no overdraft fees and no minimum balance requirements. Its app has a free built in budgeting tool, that gives you purchase notifications, and insight to your spending. Premium users can even break up their savings account into different pods which is super helpful if you’re saving for multiple things at once. And when you set up direct deposit you can get paid up to two days early! So, if you’re looking for another bank account to hold your emergency fund or something big you’re saving for then you’re definitely gonna want to try Current because we’re giving $10 to the first 10 people who sign up using our promo code “FRUGALFRIENDS” for each episode. That’s FRUGALFRIENDS, all one word.
  • Being Uncomfortable: that feeling of slight awkwardness and uncertainty about what’s happening next. Sort of how talking about things I am not an expert on makes me feel! Eleanor Roosevelt is quoted to have said ‘do something everyday that scares you’ well – for some of us that’s talking about and/or learning about intricate financial details so you can check that box for the day. Being uncomfortable: it’s less scary when you have your friends with you!

Notable Notes:

What the Internet has to say:

This article comes from Credit Karma and outlines what you need to look for when choosing a bank

What Jen + Jill have to say:

Consider the following:

  1. What is your current financial situation?
  2. What are your current banking habits?
  3. What do you anticipate your future needs to be?

Put your money in one of the following:

  1. Traditional, brick and mortar bank: great for getting lots of financial products, interact with tellers, great for depositing  cash, access to ATM’s
  2. Online Bank: many of the same products as traditional banks, not as easy to deposit cash, free ATM use (sometimes internationally), often offer high yield savings/checking accounts
  3. Credit Union: non-profit, member-owned organizations, lots of financial products

Pay attention to:

  • Make sure the bank is either FDIC or NCUA insured! If it’s not insured you are at risk of losing that money.
  • Insurance rates; check out the APY rates
  • Minimum balances, services fees, overdraft fees, etc.
  • ATM fees
  • ATM location

More from the Internet:

This article is from The Balance and provides a list of the best no-fee checking accounts for 2020

More from Jen + Jill:

What makes for a good checking account:

  • minimal fees
  • deposit insurance
  • easy access to cash
  • mobile deposit
  • online bill pay

Recommended Banks:

  • Ally – high yield savings and checking, don’t need high balance to get good APY
  • Discover – can earn cash back rewards with debit card
  • Radius – also provides rewards for debit card use
  • Simple – has a great (free!) app for budgeting and money management
  • Schwabb – unlimited rebates on ATM fees, high yield investor checking account (great for traveling internationally)

BILL OF THE WEEK: Thank you Jocelyn for sharing your bill with us about Bill Pullman from Independence Day, AND Billy Bob Thornton from Love Actually!! AND congratulations on your debt off (again :))

Lightning Round:

Accounts you can have in addition to your checking + savings accounts

  • Bonds – invest more sustainably; try Worthy
  • Taxable Account – after tax account, you will be taxed later on the interest earned. There IS risk, it’s best to use a taxable account if you can wait for the money to grow; try Vanguard or Fidelity
  • CD’s (certificates of deposit) – commitment for a period of time to keep money with a financial institution and for that commitment you can earn higher than average APY
  • High yield money market accounts – similar to high yield savings

Wrap-Up:

Thanks so much for listening! Keep leaving us reviews on iTunes or Stitcher, and sending the screenshot to frugalfriendspodcast@gmail.com. AND share our most recent episode on social for a chance to win a $10 Amazon gift card!

Thanks for listening! See you next week!

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