How should I “shop around” for an account?

There are several features of accounts you should investigate at various banks.

Interest Rates

• Find out what the interest rate is and whether the bank can change it after the account has been established.
• Also, find out if the bank pays different interest rates based on how much you have in the account, and if so, how it is calculated.
• Ask when the interest starts being compounded (when they pay you interest based on your principal plus your earned interest).
• Ask what the annual percentage yield is. This is a rate that will tell you how much interest you will earn on a deposit.
• Ask the minimum balance required before you start earning interest.
• Ask if you start earning interest when you deposit a check, or when the check is actually credited to the institution.

Fees

• Ask if you will pay a flat per-month fee.
• Find out if there is a penalty fee for dropping below a minimum balance.
• Ask if there is a charge for each deposit or withdrawal and how much.
• Inquire about ATM fees: making deposits, withdrawals, and how these fees vary if you use an ATM owned by the bank.
• See if there is a charge for bill payment by phone or online.

Additional questions:

• Will I be charged per check I write?
• Will my fees be reduced if I have multiple accounts with the bank?
• Will fees be waived if I use direct deposit?
• Is there a fee for canceling a check?
• Is there a fee per balance inquiry?
• Will there be a fee if I close my account soon after it is opened?
• Am I charged a fee if I write a check that bounces?

Limitations

• Find out if there is a limit to the dollar amount of withdrawals or frequency of withdrawals.
• If you close the account before your interest is credited, ask if you will still receive that interest.
• Find out how long it takes a check to clear, and how long you must wait to withdraw funds you have credited to your account.

CDs

• Establish the term of your account.
• See if the account will roll over automatically, and see if there is a grace period in which you can withdraw your funds after your term comes to maturity.