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Best Banks and Credit Unions

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The right bank or credit union for your finances is more than just a holding spot for your money; it is a tool for simplifying your money management. You can have multiple accounts, take out loans, plan for retirement and more, all with the same institution.

The best banks and credit unions offer low fees and competitive rates and have easy-to-use interfaces. Banks with a wide variety of savings vehicles, such as high-yield savings accounts, certificates of deposit (CDs) and financing options like personal loans, credit cards and mortgages, will give you the most flexibility to reach your financial goals.

To narrow down our top three picks, we looked for banks and credit unions that would benefit the average person the most. We also considered which financial institutions have excellent online banking and mobile app options. Finally, we only considered banks or credit unions that are financially stable and backed by either the Federal Deposit Insurance Corporation or the National Credit Union Administration.

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Merrick Bank logoMerrick BankWells Fargo logoWells FargoAlly Bank logoAlly Bank
Rating3.83.83.6
# of reviews2,1223,3091,417
Our pick for Building credit Small businesses No fees
Minimum deposit $25,000 for CDs $25 for savings $0 for savings
Annual percentage yield 3.20%-4.60% for CDs only; no saving accounts 0.15%-2% for savings 3.30% for savings
Accounts offered CDs, secured credit cards and recreational and personal loans Checking, savings, CDs, credit cards and personal, home and auto loans Checking, savings, CDs, credit cards, retirement and investment accounts and personal, home and auto loans
Read Reviews Read Reviews Read Reviews
All information accurate as of time of publication.

Compare our top 3 choices for banks and credit unions

The right bank or credit union makes it easier to stay on top of your money without weighing you down with monthly fees and account minimums.

Best to build credit Merrick Bank
  • Minimum deposit: $25,000
  • APY: 3.20%-4.60%
  • Accounts offered: CDs, secured credit cards and recreational and personal loans
Merrick Bank Logo Learn More

For those looking to build or rebuild their credit, Merrick Bank is the best choice. While you will not find savings or checking accounts offered, you can get a low-annual percentage rate (APR) secured credit card through Merrick Bank. Select secured cards come with $0 fraud liability protection and the option to double your credit line after the first seven months.

Online tools such as goScore are free for Merrick Bank customers and will help you track your FICO score without impacting your credit. Customers are also able to manage their accounts at any time of the day.

Merrick Bank also offers certificates of deposit with decent interest rates but requires a high minimum deposit of $25,000. Terms range from three to 60 months. If you want to apply for a loan, you can do that as well. However, unlike other banks that allow you to apply for a loan online, Merrick Bank offers its recreational and personal loans through its dealer partners or by calling customer service.

  • Secured credit cards with low APRs
  • Free FICO score monitoring
  • Extensive financial education resources
  • No physical branches
  • No savings or checking accounts
  • $25,000 CD minimum
Many customers have had success with improving their credit scores after signing up for Merrick Bank’s secured cards. Customers also praised the bank for its personal and friendly customer service. “Overall I enjoy the card and use it over most of my other cards,” said one reviewer from Texas. “They always followed through with increases as mentioned when signing up or applying for (the) card."

Some customers had issues with the credit card, stating they didn’t like the yearly fee or that their request for a lower interest rate was never honored.

Best for small businesses Wells Fargo
  • Minimum deposit: $25
  • APY: 0.15%-2%
  • Accounts offered: Checking, savings, CDs, credit cards and personal, home and auto loans
Wells Fargo Logo Learn More

Founded in 1852, Wells Fargo is a well-recognized name in the baking industry. It offers an extensive selection of financial products, from savings accounts to mortgage refinancing. Along with personal finance options, Wells Fargo has several accounts and tools just for small business owners.

Small business owners can finance their needs with the help of cash-back business cards or lines of credit. They can use Wells Fargo’s point of sale (POS) system to accept payments anywhere, with a connection right to a business checking account. Automatic payroll services are also available for businesses that want a faster way to pay their employees.

Finding a Wells Fargo bank or in-network ATM is easy, even when you travel. Personal savings account APYs are low, but fees can be waived if you meet flexible account requirements.

  • No monthly fees for customers ages 17 to 24
  • Thousands of ATM and branch locations
  • Online app and digital wallet
  • Low savings APY
  • Special rate CD requires $5,000 minimum deposit
  • Overdraft fees up to three times per day
Customers choose Wells Fargo because of the number of services available and for how easy it is to find a local branch or in-network ATM. “I have done business with Wells Fargo for many years, and most of the services they offer are done in a professional manner,” said one Florida customer. “Their rates are competitive and offer services for whatever stage of life you're in.”

Many complaints revolve around Wells Fargo’s fraud department. Some said that certain transactions were marked fraudulent due to a user error, and it affected the customer’s account. Others said that the bank wasn’t proactive in taking the customer’s side when the customer reported fraudulent activity.

Best for no fees Ally Bank
  • Minimum deposit: $0
  • APY: 3.30%
  • Accounts offered: Checking, savings, CDs, credit cards, retirement and investment accounts and personal, home and auto loans
Ally Bank Logo Learn More

Ally Bank has come a long way since it first started offering high-yield online savings accounts in 2009. Now the bank offers a wide range of financial products, including CDs and money market accounts, retirement and investment accounts, and loans to purchase or refinance a home.

There are no minimum deposit requirements for an Ally Bank online savings account and no monthly maintenance or overdraft fees. Its credit cards come with no over-the-limit fees or returned payment fees. If you want a No Penalty CD, you don’t need a minimum deposit and you won’t pay an early withdrawal fee once your account is a week old.

The online savings account comes with features to help you save even more, such as “surprise savings,” which analyzes your linked checking account for safe-to-save money to transfer. You can also have multiple buckets for savings, helping you save money toward specific goals.

While the online tools and customer service are beneficial, Ally Bank is a 100% online bank, which means you can’t deposit cash or visit an in-person branch.

  • No fees on several products
  • Higher-than-average APY
  • 24/7 customer support
  • No cash deposits
  • No physical branches
  • Six account withdrawals and transfers per statement cycle
Many reviewers are happy with Ally’s competitive rates and easy-to-access customer service. “Ally Bank is perfect for anyone who doesn't require a physical bank to satisfy their banking needs,” said a customer from California. “Their customer service is very good, and the web interface is easy to understand and fast. …They have plenty of ATM locations.”

Several of the negative reviews are about Ally’s auto loan financing. Individuals struggled to get in contact with Ally’s auto division for customer assistance and even had payments rejected through the app.

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How to choose a bank

There are many banks and credit union options available, but not all of them will fit your financial goals. Before deciding on a bank or credit union, consider the following questions:

What type of financial services do you want?
In addition to opening a savings account or checking account, decide whether you are also interested in products like loans, mortgages or credit cards. Most banks offer a range of card options, from debit to secured credit and everything in between.
If savings is your primary focus, look for banks that offer automatic roundups or scheduled transfers from your checking to your savings account. If you struggle with budgeting, you might want to look for ones that offer budgeting advice or offer a budget tracker.
Most banks and credit unions offer some level of online and mobile banking, but more traditional banks can use technology that feels more cumbersome than helpful. See if the bank has its own app, and get a feel for how innovative its online banking features are from the bank’s website.
Even if you are using an online-only bank, you should choose one that has several in-network ATMs near you. You should also consider the out-of-network ATM fees and if there are any reimbursements or waivers offered for using out-of-network ATMs.
Hidden bank fees can make for nasty surprises on a monthly statement. Some accounts require customers to maintain a minimum balance at all times to avoid a monthly surcharge. Others waive these fees for those with direct deposit or student accounts. Withdrawal fees can be another issue. Some types of accounts limit the number of free withdrawals. Once you meet that minimum, future transactions can carry a small fee.
Bank interest rates vary widely. When opening a savings account, customers should review the interest rate structure in detail. Credit unions sometimes offer higher savings and lower lending rates.

What’s the difference between a credit union and a bank?

While credit unions and banks are similar in many aspects, there are a few key differences.

Credit unions are member-owned cooperatives. Credit unions typically have higher interest rates on savings accounts and lower interest rates on loans. Due to their local nature, they are also known for emphasizing customer service. For this reason, a credit union is an attractive option for many consumers.

Traditional banks are for-profit institutions and often have more branches throughout a region or an entire country, so they are easier to access. They can offer a more extensive array of financial services than credit unions do.

FAQ

Is it safer to use a bank or a credit union?

Federally insured banks and credit unions both offer protection of deposits up to $250,000 and are equally safe. Banks are insured by the FDIC, while credit unions have the backing of the NCUA.

Should I use a bank or a credit union?

The choice is up to you. Banks offer convenient locations and can sometimes have tech-savvy apps or websites to make managing your finances easier. Credit unions also come with unique perks. Each credit union is not-for-profit, returning profits to members via lower loan rates, higher savings rates and lower fees.

Do banks charge more fees than credit unions?

Some banks do charge more fees than credit unions, while others have no-fee services. Similarly, credit unions can range in how they charge fees. Most will not charge a monthly account maintenance fee, but you may incur fees for overdrafts.

Is it easier to get an account with a bank or a credit union?

Credit unions require all the members to be connected in some way. This might be having a certain employer, living in a certain area or being related to a member. Many credit unions make it possible for almost anyone to join. Banks do not have these types of membership requirements, and opening up a bank account is easy if you meet the minimum deposit requirements.

Not sure how to choose?

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    Compare Top Banks and Credit Unions

    Disclaimer

    Information in this guide is general in nature and is intended for informational purposes only; it is not legal, health, investment or tax advice. ConsumerAffairs.com makes no representation as to the accuracy of the information provided and assumes no liability for any damages or loss arising from its use.

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