Free checking accounts used to be commonplace, but as banking has grown more sophisticated it’s also gotten more expensive. The Internet, though, has made it easy for banks to offer a free checking account to almost anyone who qualifies. However, the government mandates that a checking account can’t be marketed as “free” if the consumer could potentially be charged a maintenance or activity fee.
Featured Checking Accounts
So what does “free” checking actually entail?
The term “free” is debatable since most checking accounts reserve the right to charge fees for certain activities, like if you overdraw your account. What isn’t debatable, however, is the fact that a free checking account can be highly valuable if you know how to avoid these fees.
The best free checking accounts in 2018 give you free cash for signing up, have plenty of access to no-fee ATMs, and do not charge additional fees for all of the “extras.”
If you’re looking to open a free checking account online that won’t cost you anything, I recommend going with Capital One 360.
Here’s what makes Capital One 360 the top choice:
- 38,000+ free ATMs
- Mobile app
- No foreign transaction fees
- Only fee is $25 for stop payment on a check
You Can Open a Capital One 360 Savings Account, Too
If you’re looking for both a checking account and a savings account, Capital One 360 has you covered. With the Capital One 360 Savings Account, you can enjoy fee-free savings every day with a great daily rate.
- Fee-free savings with no hidden fees
- A competitive daily rate
- Free online and mobile banking
- 24/7 live customer service
The Top 6 Checking Accounts of 2018
- Capital One 360
- USAA Classic Checking
- Ally Interest Checking
- EverBank Yield Pledge®
- Bank5 Connect High Interest Checking
Now that you know where to find some good options for a free checking account online, let’s get into more detail on how you can use your checking account.
The Best Checking Accounts in Detail
Capital One 360
The Capital One 360® account is a great all-around selection for a person looking for a “big bank” feel from their online account. Capital One is a trusted financial brand and has a large network of ATMs across the country. To top if off, Capital One boasts access to about 40,000 no-fee ATMs. By contrast, Chase has about 16,000. Their superb mobile platform means your money won’t miss a beat. That’s a ton of value for no monthly account fee.
- No hidden fees or minimums as you earn interest on your everyday money
- 38,000 fee-free Allpoint® ATMs and 2,000 Capital One® ATMs
- Free MasterCard® Debit Card for all purchases
- Mobile check deposits with CheckMateSM & one checkbook’s free
USAA Classic Checking
USAA Classic Checking offers a free checking account designed around your needs. This account makes it easy and convenient to make deposits and offers plenty of free tools that can help you budget and monitor your spending. For your convenience, USAA also offers Web BillPay®, an online bill pay feature that makes it easy to manage all of your household bills online. However, like other USAA products, this is only available to active duty military personnel, veterans, their families, and other affiliates.
- No monthly service fees
- No minimum balance requirements
- Free ATMs nationwide
- Free direct deposits
- Free transfers and bill payments
Ally Interest Checking
The best feature of this account is Popmoney®, which you can use to move money between Ally accounts or transfer to non-Ally accounts. Popmoney® also serves as a micropayment solution, enabling you to pay almost anyone anywhere via email or text.
- No monthly maintenance fees
- No minimum balance to open
- 24/7 live customer care – talk to a real person
- No ATM fees from Ally, nationwide.
- Deposit checks remotely with Ally eCheck Deposit℠
- Send someone money with Popmoney®
If you like the idea of a mobile-first banking strategy, then GoBank™ is for you. GoBank is the only account on the list that does not pay interest, but its features are so innovative that I had to include it as a best free checking account option.
As with Chase, there is a ‘membership fee’ that is waived in any month where you have a direct deposit of $500 or more – so make sure you hook up direct deposit if you choose this account. Mobile check deposits, online bill pay, and a massive free ATM network all come standard. The big feature is that there are absolutely NO overdraft fees or NSF charges.
GoBank does charge a foreign transaction fee of 3% — so if you’re planning to travel internationally, this isn’t the checking account for you.
The mobile app has a really unique feature that, when authorized, enables you to check your balance from your phone without logging into the app. This is called the Balance Bar.
Additionally, the Fortune Teller feature enables you to set a very simple budget with payment due-date reminders. Then, the magic happens. You can check your budget before you spend by inputting the cost of what you want to buy. The program then gives you a “yay” or “nay” based on the budget you set for yourself. If only Mint.com would do this!
- No monthly fees
- Mobile app available
- Innovative mobile budgeting tools
- Free bill pay
Everbank Yield Pledge® Checking
EverBank is the place to go for high-interest checking. Their first-year bonus APR of 0.95% on all balances is about 15 times the national average. Use this checking account like a savings account and set up transfers or a partial direct deposit into this account. With the mobile app, you can deposit checks, pay bills, or check your balance on the go.
If you can maintain a $5,000 account balance, EverBank will reimburse all of your ATM fees. If $5,000 is a bit steep, I would recommend going with a Capital One 360® account or Bank5 Connect to avoid ATM fees.
- $1,500 minimum opening balance
- $0 minimum balance to earn interest
- No debit-card fee
- No EverBank ATM fee
- Unlimited ATM reimbursements with minimum balance
- Free online & mobile banking
- Free deposits from home
Bank5 Connect High-Interest Checking
Like EverBank, the most attractive features of Bank5 Connect’s High-Interest Checking are the high interest rates and ATM fee reimbursement. Bank5 offers a 0.76% APY on all balances over $100 and reimburses third-party ATM fees, up to $15 per statement cycle.
While EverBank reimburses unlimited ATM fees, remember you need to keep a minimum balance of $5,000 to enable that feature. Bank5 has no minimum balance requirement for ATM reimbursement. Bank5 also employs dedicated mobile apps, complete with mobile check deposit and online bill pay, for free, all with no monthly fee.
- No monthly maintenance fee
- Free online banking/bill pay/eStatements
- Free mobile banking
- UChoose Debit Rewards program
- Free first order of basic checks
- No ATM fees, and third-party fees are reimbursed up to $15/month
Additional Banking Guides
If you’re looking for other banking services to go with your checking account, here are some other useful guides on important banking accounts and services:
The Four Functions of a Checking Account
I’ve been using online checking accounts ever since I was in college, and every single one of them has been free. I maintain a variety of accounts for different purposes: business, savings, paying my mortgage, long-term investments, and short-term bills.
I look at a checking account as a clearinghouse that has four main functions:
- Put money in
- Pay money out
- Store money
- Access cash
Here’s how I would use a Capital One 360® checking account to accomplish the four functions I’ve mentioned above.
Get Money In
For starters, I would go ahead and take advantage of the free direct deposit this account offers. Why? Convenience. Using direct deposit saves me at least one trip to the bank each month, yet my money is available for use right away.
Then, I would use their CheckMateSM system to upload images of my checks and deposit them straight from my mobile phone or computer.
Pay Money Out
I don’t use cash — ever. I use a rewards credit card for every purchase I make and then pay off the bill each month. I earn credit card rewards on the card for everyday purchases and don’t pay a dime to the credit card company.
Frankly, this is a better return on my money than paltry savings account rates now. The Capital One 360 account also has free online bill pay service to pay any bill — even to friends!
Some big banks like Chase have their own systems to send money to other Chase customers using an email address. Since Capital One doesn’t have this feature, you can use their online bill pay feature or any one of the free micropayment services out there. I’ve used Dwolla, Venmo, and Square Cash. You can even send money for free through Gmail and Google Wallet.
In this extremely low-interest-rate environment, many interest-bearing checking accounts pay better interest than savings accounts or money market accounts. Capital One 360 is generally one of them, but you should check the current rates prior to signing up.
Creating bank-to-bank transfers with the Capital One 360® checking account is a breeze. I would actually get automatic transfers set up into my online brokerage sweep account every month to make sure I’m saving enough.
One of the biggest complaints I hear about an online free checking account is the lack of access to ATMs that won’t ding you with a fee. The Capital One 360 account has a surprisingly large network of no-fee ATMs — 40,000 of them to be exact. If you go to a non-network ATM, you could get hit with a third-party fee, however.
If you use ATMs a lot, try the EverBank Yield Pledge® checking account, which actually reimburses you for all third-party ATM fees!
These four situations cover 95% of my checking account needs and they can all be handled online. The biggest exceptions I’ve experienced include depositing larger checks or getting a cashier’s check to buy a car or a house, for instance. In those rare cases, I have had more than enough time to deposit the check by mail or make arrangements with a local bank to obtain a cashier’s check.
I used the four factors, among other things, to select the top free checking accounts. The best free checking accounts, like Capital One 360, will have all of these features.
Choosing the Best Free Checking Accounts
Here is how I got started:
- I started my search by first looking at different offers from traditional banks.
- I realized that other types of financial institutions also offer savings accounts online, so I expanded my search beyond traditional banks.
These financial institutions offering checking accounts are from a variety of places like:
- Auto finance companies
- International banks
- Large commercial finance companies
- Credit card companies
- Insurance companies
- Online brokerages
- Smaller regional banks with Internet-banking arms
- Credit unions
Once I had a large list of online accounts built up, I started adding filters to my search.
I looked for checking accounts that had these six must-have features:
- Free direct deposit
- Free online bill pay
- No monthly fee or low minimum balance to avoid the fee
- No-charge ATM fees
- Mobile banking with mobile deposit feature
- Free bank-to-bank transfers
I originally didn’t include interest as a major factor of online checking, but the more I researched, I realized many checking accounts are actually paying more interest than savings accounts. With so many checking accounts paying high interest, I added it as a valuable feature.
My last steps were more qualitative. Once I compiled this list, several leaders emerged but I still needed to weigh the factors above to come out with a reliable list.
Free direct deposit, online bill pay, and bank-to-bank transfers were common characteristics that I could not separate.
However, I found the best checking accounts stood out in at least one of two areas:
- Superior mobile applications
- Free ATM transactions and third-party fee reimbursements
The seven best checking accounts you see here all met my initial threshold and combined at least one of these final two requirements.
The exception to the rule is GoBank, which made the list despite not offering my initial interest-bearing requirement. However, this checking account deserves to be on the list because of its mobile-first strategy and its forward-thinking approach to the future of banking.
My overall assessment is that Capital One 360 is the best online checking account. If you’ve been thinking about starting a new checking or savings account lately, Capital One 360 is probably your best bet.
There are some special circumstances where not only do all of the benefits of having one of the above free checking accounts take on more importance, but applying for them also increases in difficulty as well. Though the application requires a little more effort, it is still possible to do, and doing so could be vitally important to your financial future. Because of that, we’ve compiled some information and advice to aid in the process for those in the following situations:
There are millions of international students from all over the world studying in America. Most of them are under the age of 25, and do not have much knowledge of how personal finance works in America. These students need to be able to receive money in a safe and secure way from either their parents, financial aid, loans or the jobs that they work. Having a U.S. bank account makes these processes a lot easier.
- Convenience: Wiring money through a third party source, such as Western Union instead of directly through a bank can be a hassle, and incur fees and charges that can be avoided. Transferring money from one bank account to another is even possible with phone applications, make the process a few button presses.
- Reliable: A lot of schools will have an international students office that will help students set up a bank account. Schools will refer you to a bank that they have worked with often to get the students the best rate, plus the banks will be used to working with international students to make the process smooth.
Things to Consider
Some free checking accounts require that you have deposit a certain dollar amount before setting up. So make sure that you have sufficient funds. This will depend from bank to bank.
The requirements are usually the same for each bank, and the process can be made a lot smoother if the international student works with their school. If you the student is missing any of the documents, a person at the school might be able to help them.
- Identity: International Student’s full name, telephone number, campus phone number, and college address. A passport will also be required, and the student’s I-94 card, I-20, DS-2019 or I-797 approval notice. It is also a good idea to bring a second form of identification such as the student’s school ID.
- Proof of Attendance: The bank will also require proof that the student is attending the school, the school can provide an enrollment verification letter.
It only takes watching any ten minutes of a 24-hour news cycle for it to be immediately clear that the topic of immigration in this country is a divisive one. However, regardless of which side of the debate you fall on, there are no denying the benefits of undocumented immigrants having access to American banking institutions. Having the money, which they earn through their undeniable hard work, invested in established banks is much better for the overall economy than just circulating cash. And for the worker, not only does it help establish the economic security that brought them to this country in the first place, it can also go a long way in positively affecting immigration status.
- Safety: The first and foremost benefit of an undocumented citizen opening a checking account is security, not only financial security, but physical safety as well. Because they have no checking account to deposit to, undocumented workers are typically paid in cash, or checks that are immediately converted to cash through costly check-cashing services. The more that physical cash accumulates, the bigger target for theft they become. And since over 80 percent of robberies involve violent threats and deadly weapons, securing that money in a checking account keeps both investments and people safe.
- Establishing Financial History: Having a documented financial history is often a vital component in securing housing, connecting utilities, buying a cellphone, etc. A checking account, and its accompanying monthly statements, are one of the easiest ways to do that. Having a bank account is also the first step in building credit, which is necessary for buying a home, a new car, or applying for any kind of loan.
- But the benefits of an established financial history extend beyond simply the financial. Many undocumented immigrants avoid opening a checking account for fear of government retaliation. Not only are those fears somewhat unfounded, there are actually benefits to your immigration status in doing so. Being able to prove a history of living and working in the United States increase approvals when applying for immigration status changes, both permanent and temporary. Bank membership and credit history can also help in securing loans for deferred action or naturalization applications, if necessary.
- Savings: The aforementioned check-cashing services, money orders, payday loans, and pre-paid debit cards all end up costing an unnecessary amount of extra money when used to pay bills or make purchases. Checking accounts eliminate the need for them, thereby saving a lot of money in the long run.
- Transferring Funds: Perhaps the number one factor prompting immigration to the U.S. is the financial opportunity it provides, opportunity the families of undocumented workers back in their home countries don’t have, but can still benefit from. One of the main financial priorities of those immigrants is sending the money they earn back home to support those family members. A checking account makes cash-to-cash transfers and account-to-account transfers both easier, and cheaper (free in some cases). And depending on the issuing bank’s ATM network and international policies, it may be possible for the account to have dual cards: one for the worker and one for the family back home to withdraw funds as necessary.
In general, applying for a checking account requires two things: proof of identity and address. To establish that, you need documentation that checks off the following four items: identification number, name, date of birth, and residential street address in the United States.
- Identification Number: When the U.S. Treasury Department approved the use of consular ID cards for banking identification purposes in 2003 (and when major banks like Bank of America announced that they would be accepting them), many assumed that would be the only documentation necessary to open a bank account, and it’s a belief that is still widely propagated today. However, a matricula consular only establishes name and address. You still need an identification number. Without one, there is virtually no way to open a checking account with an American bank. However, identification number does not necessarily mean Social Security Number (a lack of which prevents many undocumented immigrants from applying for accounts). There are a plenty of banks today that allow you to open a checking account with an Individual Tax Identification Number (ITIN). The ITIN is a tax processing number issued by the IRS to residents and nonresidents, regardless of immigration status, who are not eligible to obtain a Social Security Number. The ITIN can be used in most cases that typically require an SSN, including opening a checking account. You should check with any bank to see if they will accept an ITIN in lieu of an SSN. Currently, major banks that do include, Bank of America, Chase, Wells-Fargo, and Capital One.
- Name and Date of Birth: Documents that satisfy proof of identity include: a valid passport, a birth certificate, a consular ID card, or a government issued driver’s license (regardless of country). As is typical of many applications processes, you may be required to supply two forms of identification, so be prepared to show two of the items from this list.
- Street Address: A foreign-issued ID card or driver’s license don’t establish a physical U.S. residence needed to satisfy the bank’s proof-of-address requirement. However, the addition of a residential address to consular ID cards means that they do. Typically, a copy of a rental/lease agreement or a current utility bill can also be used.
Things to Consider
Without some kind of previously-established credit or financial history, it might not be possible to apply for some of the free online checking accounts previously mentioned. Because they are often offered through companies that are not traditional banks – such as credit card and insurance companies – their approvals are sometimes based on a credit check. And even in cases where approval isn’t based on credit, that previous financial history, along with a Social Security Number, is a quick way for companies to confirm proof of identity and address, which is what makes the simple online application possible. Without that history (or SSN), it will most likely be necessary to physically apply for the checking account at a local bank branch in order to supply your required proof of identity documents, which is possible with both Capital One and Chase.
One issue that shouldn’t be divisive at all in the country – yet somehow often still is – is America’s homeless problem. There are over 500,000 homeless currently living in the U.S., a number that is too high for any country, let alone one with the largest economy in the world. Too often the poor in this country get stuck in a poverty cycle that they can’t elevate themselves out of due to societal impediments. However, checking account can go a long way in helping increase their quality of life. And with significant access to free internet in public places like libraries, free online can be a life-changing option.
Not all homeless people fit into the stereotypical category of the penniless drifter begging for change. Many homeless people have some form of income, just not enough to afford housing or to support a middle-class lifestyle. Income often comes in the form of social security, disability benefits, child support, alimony, retirement checks and pension payments, or wages from a job. A checking account can be a crucial component of that income.
- Access: Without an address for the provider to mail checks to, much of that income is nearly impossible to access. However, direct deposit to a free checking account means that the funds will be delivered regularly and immediately available without having to find a way to receive and cash a physical check.
- Savings: Again, check-cashing services, money orders, payday loans, and pre-paid debit cards cost money to use. When your income is severely-limited, even the smallest service fee can be detrimental. It can be the difference between eating or not. But a free checking account eliminates the need to use those services. They also eliminate the maintenance fees of traditional checking accounts, allowing you to keep more of the money you earn to be used on vital expenses.
- Safety: Just like in the case of undocumented immigrants, safety is one of the prime reasons for a homeless person to open a checking account. Cash makes anyone a target for theft, especially those living on the streets with nowhere but on their person to store it. A checking account keeps that money in a secured, insured place.
The same requirements that impede illegal immigrants from opening a checking account also plague the homeless population: proof of identity and residence. However, with a little effort, and thanks to some inherent benefits of online checking, it is possible.
- Proof of residence: This is the first, and most obvious concern. Even though so much of banking is wireless today, banks will still reject applicants who have no physical, residential address. A P.O. Box number isn’t enough to satisfy them. Fortunately, there are homeless organizations that can provide you a physical address for the purposes of job applications, benefit information, etc. Some of them even provide mail service in personal boxes, much like P.O boxes. More and more banks are now accepting homeless service center address as valid residence. And those that “officially” don’t, they might not even be able to tell the difference between a homeless center address with a mailbox number and a residential address with an apartment number on the application.
- Another option is to list the address of a trusted friend or family member. Traditionally, the concern with doing either of those would be your regular bank statements (or checks and debit cards) being delivered to either the service center where they could be intercepted and stolen, or to someone else’s home where they may be hard to get access to. However, online checking eliminates the need for mail. Instead, you can opt for paperless statements delivered electronically. And most banks will also allow you to pick up debit cards and checks at a local branch, rather than have them sent directly to you.
- Proof of identity: The homeless currently face a physical ID problem. By nature of their situation, they are at a greater risk of having identifying documents lost during eviction sweeps, stolen along with money and personal effects, or simply lost during the process of carrying their belongings everywhere they go. And unfortunately, replacing identification or Social Security cards isn’t free.
Only a handful of states waive those fees for the homeless or those living below the poverty line. Application fees and replacement costs are often an expenditure that the homeless can’t afford, or simply can’t justify. But without physical identification, they are severely limited in the things they can apply for. However, applying online for a free checking account eliminates the need to have a physical ID card like you would need if applying in person at a local bank branch. When applying online, you manually enter your information into the digital form. All you need is your actual social security number, as opposed to the actual card. They verify your identity electronically.
Things to Consider
Some free checking accounts require an initial set-up of direct deposit in order to both open an account and avoid any fees. This is possible for those with social security, disability, or various other kind of regular income checks. However, some require an initial deposit from an existing personal checking account, which may not be feasible for someone who is homeless with no bank accounts. However, there are enough which rely on direct deposit alone. Always be sure to check the terms of any account before applying.
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