Data breaches have become all too common, and my husband and I recently felt this firsthand. Last year, my debit card got hacked during the Target breach, and not long after, his was compromised in the Home Depot breach. Our bank canceled our cards without much notice, which was a huge hassle, especially since we didn’t have credit cards at the time.
Adding to our frustration, we recently received a letter from the bank saying our online bill pay account was suspended due to inactivity over the past four months, even though we had just signed up for it!
Fed up with the bank’s poor customer service, we started looking for better options and found that switching to an online-only bank could be the right move for us for three main reasons.
EASY TRANSFERS
After my husband and I, who met in college, got married during my last semester, we moved to a new state for my job and had to close our local bank accounts and join my employer’s credit union, which offered great benefits like high interest rates and free checks. But two years later, when I got a new job in another state, we had to switch banks again, opting for another of my employer’s credit unions. Our luck ran out when we moved a third time and couldn’t find a similar option, so we settled for a local bank, which turned out to be a bad decision.
Moving from one bank to another was such a headache that we realized we needed to switch to a national bank to avoid constantly opening and closing accounts. With an online-only bank, we wouldn’t have to worry about being near a physical branch; the bank would always be available to help us.
HIGHER INTEREST RATES
One of the biggest benefits of online-only banks is the higher interest rates they offer compared to traditional banks. These online banks can provide better rates on both savings and checking accounts because they don’t have the high operating costs of physical banks. You can even earn interest on your checking account!
ATTRACTIVE PERKS
We were initially concerned about ATM fees with online banks since we do occasionally need to withdraw cash, and my husband travels often for work, so he might need to get cash from ATMs worldwide. Luckily, top online banks either refund ATM fees or have large networks of fee-free ATMs.
Additionally, the online bank we chose offers free checks, compounded daily interest, and no monthly maintenance fees—benefits we didn’t get from our previous national banks. Overall, switching to an online-only bank has made our financial life much easier and more rewarding.