About Ken Tumin

Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

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Free Checking Accounts Requiring More Work at the Mega Banks


Readers have been reporting that they have been seeing new fees on their checking accounts from the mega banks. I've reviewed the new checking account options at some of the mega banks. It is harder to stay free of monthly fees. In the past a common way to have monthly fees waived was to maintain a certain balance or direct deposit. A new way that is growing in popularity is performing certain account activities. Two examples of the checking activity requirement to avoid a monthly fee are from Citibank and Chase.

Citibank has discontinued their EZ Checking account. The checking account that's now the easiest to avoid a monthly fee is the Citibank Basic Checking. To avoid a $8 monthly fee requires performing 5 qualifying transactions each month. These include direct deposit, debit card purchases, certain bill payments, ACH payments, checks paid and ATM cash withdrawals.

Chase Bank has a checking account with similar ways to avoid a monthly fee. Chase Checking requires either 5 debit card purchases or a direct deposit of at least $500 to avoid a monthly fee of $6.

Easy Free Checking Accounts

This activity requirement to avoid a monthly fee reminds me a little of high-yield reward checking accounts. However, with reward checking accounts, you're not hit with monthly service fees if you fail to meet the monthly requirements. You just won't receive the high interest rate and the ATM fee reimbursements. There are hundreds of community banks and credit unions around the nation offering free reward checking accounts. You can find these in our reward checking account tables.

If you don't want to worry about monthly account activity requirements, an internet checking account can be a good choice. Two popular ones are the checking accounts at Ally Bank and ING Direct. I compared these two in this post.

If you feel you need a local brick-and-mortar office, you might want to consider having two banks. One is an internet bank and the other is a local bank or credit union. I described this approach in my post on choosing a new bank. You can find regular checking accounts at both internet banks and from brick-and-mortar banks in our checking account tables.

Related Pages: checking account

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  |     |   Comment #1
The large banks are clearly the more egregious in terms of trying to hit their customers with fees.  Smaller banks treat their customers better, at least in my area.  When enough customers vote with their feet and leave the big banks, perhaps this will change. 
  |     |   Comment #2
TD Bank offers "convenience checking" for free for one year, then you only need a $100 minimum balance to avoid the fee.  For a minimum-balance account, this is by far the lowest I've found.  TD Bank is also somewhat great when it comes to the big banks--open 7 days a week, 24-hour customer service number where someone answers the phone immediately (no computer), etc.  I just switched to them from BofA (got a new account promotion gift) and despite the smaller number of branches, I'm quite pleased so far.  It feels as though TD actually wants customers, whereas BofA (and Citizens as of late) are shooing them away.
  |     |   Comment #3
My local credit union added on a ton of service charges like a dormant acccount charge to a charge for using a branch office more than three times in a month.  They charge for online bill pay if you don't accept e-statements and if you exceed 15 in one month.
  |     |   Comment #4

Anonymous 3  Seriously, I think you should look into a membership in Alliant Credit Union. Unless there's some compelling reason to stay with your present local credit union, I think you would be a lot better off with Alliant.  The way your credit union is jerking your around sounds like the treatment a megabank would subject you to.
  |     |   Comment #5
Perhaps the above language about Chase Checking is a bit misleading in its present tense (has, requires). Good warning, though. From the linked website:

Monthly Service Fee
None when you have 5 or more debit card purchases (withdrawals from the ATM or cash advance transactions do not qualify) or a direct deposit post to your account during each statement period. The direct deposit qualifier changes to at least one direct deposit of $500 or more and takes effect with the statement periods beginning February 8, 2011. Two or more direct deposits that add up to $500 or more but do not individually equal or exceed $500, do not qualify; otherwise $6 per month.
  |     |   Comment #6
I suppose it's also worth mentioning that Bank of America *does* still have free checking.  It's called eBanking, and you cannot make withdrawals or deposits in a branch.  If you don't do that, and you get online statements, it's free.
  |     |   Comment #7
Capital One checking is completely free with rewards and comes to a better deal than TDBank for me.  Why?  Because I get 1.43% with them (with 1.30% 10% quarterly rate bonus) and I have a Simple Savings account (1.10% with 0% FOREX for ATM usage, $1.50 fee though), and the Rewards Checking account with them.

Instant bank to bank transfers within the bank to the 1.43% 1.10% accounts along with checking.

While most other banks stopped free checking accounts like Citibank, firms like Capital One seem to be intensely competitive in the marketplace. 
  |     |   Comment #8
On FatWallet people seem to like ripping into Capital One rather than acknowleding they have excellent deals. 

Even this posting here seemed to indicate banks were pulling back on the marketplace, yet Capital One has been intensely competitive.

TDBank is also intensely competitive.

HSBC was intensely competitive but pulled back its Online Payment account for new customers unfortunately.

Local community banks still offer free checking.  Also larger banks like TDBank and Capital One have no fee or low min balance accounts. 
  |     |   Comment #9
All this regarding Ken's post and further discussion brings back memories of old. I remember back in the late 70s when I joined the Air Farce, I opened a checking account; the DoD had just mandated that we use direct deposit, too. Paper checks were going the way of the dinosaur.

Anyways, back then checking accounts weren't cheap either. It's back to the same-old same-old, in point of fact. Monthly maintenance fee whether the account was dormant, active, hyperactive, and the like. You paid a fee regardless. There were none of the fees like those we're being inundated with ad nauseum today. So, that said, I don't consider it anything "new,"unfortunately.

I bank with USAA and seriously doubt they'll ever charge a fee for their checking accounts. And since that part of their bank is open to all, now's a good time to think about switching if you're not happy with your current bank.
  |     |   Comment #10
Can add Citizens Bank to the no longer offering free checking. Now is $4.99 a month unless you keep $1,500 or make 5 purchases. 
  |     |   Comment #11
Existing banks won't can free checking.  Plenty of free or low min checking accounts around.  Just make sure you take them before they get phased out since some banks grandfather them in. 

Example:  HSBC Online Payment Account, still exists for existing customers.  No minimums. 

Capital One Rewards checking still totally free for all customers.

TDBank first year free, $100 min thereafter. 

New York Community Bank has free checking.

Sovereign has a $500 min balance requirement on its lowest cost checking account. 

  |     |   Comment #12
Some banks are canning them. I just got a large important-looking letter from Chase, opened it up, and found out that although they cannot do anything about my CC (unless they decide to close my account), my checking accounts (from WaMu) are not protected from their evil and will be switched to a type that is more expensive (and complex to avoid fees) than their standard type as of Feb 8th. New accounts (according to a mailer someone else got at my address) show a new customer gets no fees if they have a DD of any amount OR 5 debit card transactions (non-ATM) (OR a few account amounts), otherwise it's $6/month. Mine says it's turning into "Chase Total Checking", which requires a DD of at least $500, $1500 in the account on average, $5000 across all linked accounts, or paying fees of at least $25 a month. If none are met, $12 a month. Aka: $36/month unless I switch DD paperwork, with no interest on the accounts and 0.10% (higher than most) on savings. Congrats Chase, you finally did something that made it worth my effort and you're losing all my deposits (I could easily meet their requirements, bu).
  |     |   Comment #13

Wow, I'm lucky!  My Chase fee is changing to only $10 if requirments not met since I live in CA.  (Sarcasm!)
  |     |   Comment #14
Is it possible for banks to use overdraft protection as a basis for waiving fees? I would gladly opt-in to avoid monthly fees.
  |     |   Comment #15
When talking to a JPMorgan Chase assistant branch manager what the difference will be between all the other banks and theirs (after Feb 8, 2011 when the checking accounts change) she riverted to the "personal service" you will get in each of their branches. I smirked and said, I don't get that personal service now.

In researching who's left with "free checking" account programs, I found US Bank has a Silver Package checking account where they open a checking ($50 to open) and savings ($25 to open) together. This checking account has no minimum balance, no monthly maintenance fee, and statement/checks back options, overdraft protection plans (have options but not included with free checking), limit 6 transfers/withdrawals from savings to checking, debit/ATM card takes 3-5 business days, lots of locations including grocery store branches, no free checks (a box runs $17), no free money orders/cashiers checks or travelers checks. HOWEVER, some grocery store branches (ONLY) are running Free Checking $75 Promotions now (November). Best to call one and ask what the promotion details are.

Also, Kinecta Federal Credit Union has free checking. No minimum amount to open. So that means open with $1 or $5, no monthly fee, no minimum balance, free online bill payment, limit 6 transfers/withdrawals from savings to checking, limited locations, no free checks (a box runs $15.55), no overdraft protection, no free money orders/cashiers checks or travelers checks.

To get cheaper checks printed, best to use those that you find in Sunday coupons where you can get a box for $4 or some nominal amount.

Sad that JPMorgan Chase is turning into like all the other banks. I don't think their personal service will make a dent in difference. They will lose a lot a customers come February 8, including me, for one. I was a loyal Washington Mutual Bank customer but JPMorgan Chase is nixing all WAMU standards. We'll see how big they'll still be after February 8.  There's a lot of unemployed, customers meeting hardships right now. Cutting this free checking to "meet with Federal bank guidelines" isn't going to make them popular. Why now anyway?  JPMorgan Chase or WAMU never met with Federal bank guidelines since either one existed?


  |     |   Comment #16
Free checking accounts will always exist. 
Credit Union
  |     |   Comment #17
Not a good sign for the little guy trying earn interest off the Reward checking accounts...  The easy money of good old days are coming to an end.  I am going to be searching for a quality credit union going into the new year.
  |     |   Comment #18
OK folks when you have the government interfering in the banking industry - This is what happens. The credit card reform act - For those who paid their bills timely and per the agreement, they did not benefit from these changes. Now the rest of us must pay. As someone else already stated go back 40 years and there was a min. balance requirement not to be charged. Of course the fee was probably $2.  But back then there was no ATMs - Online Banking and they had banking hours. Closed at 3pm and they had one late night. Now we have all the added conveniences.Also it took days for your deposited check to be available. I am sure if you speak with your bank professional I'll bet they will find an account that works for you with no fees. Larger Bank offer more services with multiple branches and inter-state banking. And if you use multiple services you save in the  long run. Be careful of account that say Free because they could charge elsewhere - like Debit Card issuance fee. Smaller banks offer your basic banking services and if you typically go to the same branch - then maybe this is your best choice
  |     |   Comment #19
CHASE notification came in the mail today...  my "forever free" checking account that I've had since 1996 (formerly Home Savings of America then WAMU now Chase) will now be charging a monthly fee...  if conditions are not met.  HIDEOUS conditions that will cost me interest income.  Fortunately, I have a CD there for $20,000.  Once that CD matures in 2012, I will have to dump Chase altogether, I guess, because I will NOT keep the money at Chase with their current LOW interest rates, and that will drop me below the $5000 minimum combined balance or $1500 checking balance.  HIDEOUS.  That's all that comes to mind.  I don't like Chase ever since they took over.  Fortunately, I have accounts at about TEN banks and TEN credit unions.  I'll just remove my money from Chase and put it in one of the other places that doesn't gouge me like Chase is trying to do.

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