The Best Checking Account For Travelers, Vagabonds, and Dirtbags

7 Mar
2011
Posted in: Adventure Prep, Money
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If you travel a lot, you probably have a checking account with a large, national bank. And if you have a mortgage, chances are you have a checking account with the same bank – it is, after all, quite easy. These accounts sound like such a good deal – Premier Checking from Chase. You get interest. You’re not just some commoner off the street, you have a mortgage and the bank swoons over you because you’re paying them interest.  But these national banks don’t offer great deals — and they’re terrible for travelers.  Why?  They just aren’t everywhere.  They can’t be.  Vagabonds and dirtbags need a bank that is.

Many of us have had the same checking account for years. We’ve never really thought about it – we opened it eons ago because it was convenient back then – and we’ve never given it a second look. It’s time for that second look.  Especially if you’re going to switch to a non-direct-deposit, vagabond lifestyle.

There are new players in the banking world – online guys that know there’s no real, every-day value in opening branches and dotting the world with more ATMs. They realize that there are ATMs everywhere already and they don’t need to be in the currency distribution business. They’re just banks that will keep track of your money and make it easier to live and vacation. They realize everybody should be eligible for a high-interest checking account – not just the rich.

While Chase offers 0.01% interest (to their richest account holders), these new guys offer 0.5%-1.0% interest – rates up to 100x better – to everyone. While Chase chases you with monthly fees, these new guys charge nothing. And while Chase charges $2-$5 for every out-of-network ATM transaction ON TOP OF whatever fee the ATM provider charges, these new guys don’t charge anything and reimburse you for fees incurred at any ATM. It’s time to consider switching banks.

Who are these new banks? Well, they’re not really that new. Capital One has been around for a while – you’ve probably seen their credit card commercials on TV. Long the provider of some of the best reward credit cards, they also offer checking accounts. Ally sounds new, but it’s really just a re-branded version of GMAC, the automobile financing giant. While both offer similar accounts, there’s a key difference in their offerings: Ally is better if you’re a frequent ATM user. Capital One is better if you visit an ATM fewer than 5-6 times per month. Why? Ally reimburses you for all ATM transactions (but you’ll only qualify for their 0.5% rate unless your balance is over $15,000). Capital One reimburses up to $25 a month in ATM fees (but gives everybody their 1.01% interest rate).

Comparison of Ally, Capital One, and Chase checking accounts:

Ally Capital One Chase
Monthly fees None None $12 / month (if conditions aren’t met)
Online banking, bill pay Free Free Free
ATM fees None (reimbursed) Up to $25/mo. reimbursed Additional $2-$5 (except at Chase ATMs)
Interest* 0.50% 1.01% 0.01%
*Interest rate conditions Balance under $15,000, if above, 1.05% None Requires a ‘Premier’ account – not the $12/mo one

What’s amazing is that big banks offer 3, 4, or 5 different checking accounts thinking each customer has different needs, when in reality, we all want the same things – no fees, easy access to our money, and interest income.  Even if you’re not a frequent traveler, vagabond, or dirtbag, take a look at Ally Bank and Capital One — they’ll save you money.

As always, let us know what you think in the comments.