Big banks are the bad guys these days. Uncle Sam’s cash infusion and their billion-dollar bonuses are stirring protests. Online campaigns try to persuade people to move their deposits; some state legislators want state funds to go to community banks and credit unions. Should you make the switch?
When it comes to safety, there is no difference between big and small banks. All FDIC members are insured up to $250,000 per depositor. But you’ll typically pay lower fees and earn higher interest at a smaller bank. Bank of America and Chase charge $2 to make a withdrawal using an out-of-network ATM. But First Savings Bank of Hegewisch, in Chicago, charges $1. Bounce a check and you’ll pay $35 at Bank of America versus an average of about $30 for all banks. A one-year certificate of deposit at Chase yields 0.25%; a top-yielding one-year CD from Tennessee Commerce Bank pays 1.7%.
Community banks also offer personalized service. They will often process loans more quickly, including smaller business loans that big banks avoid. And a local banker is much less likely to rely strictly on a formula to evaluate a loan. Kim Kaselionis, of Circle Bank, in Novato, Cal., says, “We take a more holistic approach. If you have a ding on your credit, we’ll let you explain it.”
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Big banks do have some advantages, including large branch networks, overseas locations and substantial technology budgets. Travelers who want ATMs wherever they go and tech-savvy customers who crave the latest upgrades in mobile banking should consider a big bank.
-
Stocks Chop as the Unemployment Rate Jumps: Stock Market TodayNovember job growth was stronger than expected, but sharp losses in October and a rising unemployment rate are worrying market participants.
-
Should You Renew Your CD?With rate cuts impacting earnings, we examine if now is a wise time to renew CDs.
-
7 Ways to Plan Now to Save on Medicare IRMAA Surcharges LaterUnderstand the critical two-year lookback period and why aggressive planning before you enroll in Medicare is the most effective way to minimize IRMAA.
-
Amazon Resale: Where Amazon Prime Returns Become Your Online BargainsFeature Amazon Resale products may have some imperfections, but that often leads to wildly discounted prices.
-
Roth IRA Contribution Limits for 2026Roth IRAs Roth IRAs allow you to save for retirement with after-tax dollars while you're working, and then withdraw those contributions and earnings tax-free when you retire. Here's a look at 2026 limits and income-based phaseouts.
-
Four Tips for Renting Out Your Home on Airbnbreal estate Here's what you should know before listing your home on Airbnb.
-
Five Ways to a Cheap Last-Minute VacationTravel It is possible to pull off a cheap last-minute vacation. Here are some tips to make it happen.
-
How Much Life Insurance Do You Need?insurance When assessing how much life insurance you need, take a systematic approach instead of relying on rules of thumb.
-
When Does Amazon Prime Day End in October? Everything We Know, Plus the Best Deals on Samsonite, Samsung and MoreAmazon Prime The Amazon Prime Big Deal Days sale ends soon. Here are the key details you need to know, plus some of our favorite deals members can shop before it's over.
-
How to Shop for Life Insurance in 3 Easy Stepsinsurance Shopping for life insurance? You may be able to estimate how much you need online, but that's just the start of your search.
-
Five Ways to Shop for a Low Mortgage RateBecoming a Homeowner Mortgage rates are high this year, but you can still find an affordable loan with these tips.
