Back-to-school spending may be on the decline with the overall cost of education and the difficulties inherent to newfound financial freedom remain as daunting as ever. In addition to a healthy dose of financial literacy education, college students require – at a minimum – a pair of basic financial tools to confront these monetary realities.
They are, of course, a checking account and a credit card. Credit cards are the cheapest and most-accessible way for people to improve their credit scores, and credit card companies offer great deals to students. In fact they offer them in droves to students since they have high earning potential. Even in our day, you can’t pay for everything with plastic, not to mention accept a paycheck, and learning the ABCs of everyday banking is also critical to preparing for the myriad monthly bills that you’ll confront after graduation.
In order to help you identify the right checking account to use, whether it’s your first or you’re looking for an upgrade, our friends at WalletHub compared over 550+ offers for which students are eligible – including student-branded, general-consumer and online-only accounts. We evaluated each based on its fees, rates and features, and made recommendations for college students with varying types of financial needs.
Best Overall
No monthly fee together with the ability to earn a 1.5% APY on all balances up to $10,000 (0.5% after) provided you use your debit card 10 times per month AND enroll to receive online statements. There is no charge for using other banks’ ATMs, but you will receive a $25 monthly worldwide refund for the surcharge assessed by the owners of these ATMs.
Best for Cash Strapped Students
BofI Federal Bank Rewards Checking Account
The Bank of Internet Rewards Checking account is accompanied with a host of benefits: For one, it doesn’t charge any monthly fees, overdraft fees or NSF fees. For two, ATM withdrawals also are free, as Bank of Internet will reimburse charges incurred at out-of-network ATMs and doesn’t assess fees for in-network withdrawals.
This account comes with a couple of caveats. For starters, Simple customers can only send checks electronically, which means you won’t get a paper checkbook. As a result, it feels more like a prepaid card than a checking account in many respects. What’s more, after 180 days of no activity on your account, you will be charged a $5 monthly inactivity fee until the next transaction you make.
The Bank of Internet Rewards Checking is therefore a great choice for students who have a part-time job that allows them to get via direct deposit.
Best for Cash Strapped Students
Simple Checking
Simple is an online financial institution associated with The Bancorp Bank that offers a single checking product notable for its lack of fees.
This account comes with a couple of caveats. For starters, Simple customers can only send checks electronically, which means you won’t get a paper checkbook. As a result, it feels more like a prepaid card than a checking account in many respects. What’s more, after 180 days of no activity on your account, you will be charged a $5 monthly inactivity fee until the next transaction you make.
Ultimately, this account — which can be opened with no initial deposit and has no monthly fee — is a great option for cost-conscious consumers. It has one of the most straightforward — dare we say, simple — fee structures of all the checking accounts we examined. It also offers a lower foreign transaction fee than the Bank of Internet Rewards Checking. Finally, Simple leverages an ATM network that is large enough to avoid withdrawal fees.
Best for Student Savers
AmericaNet Rewards Checking
This free account gives a 1.5% APY (up to a $10,000 balance) as long as you use your debit card 10 times per month AND enroll to receive online statements.
Alternatively, if you’re willing make a one-time donation to Gifts for Easter Seals and bring proof of this to a branch in Maryland, the Money One Federal Credit Union Kasasa Cash Checking account would give you the highest APY on the checking account market: 3.01% on balances up to $10,000. It doesn’t charge a monthly fee either and accountholders are reimbursed for all ATM withdrawals nationwide.
Best for Students Traveling Abroad
Charles Schwab High Yield Investor Checking
For students that travel abroad or even like to shop from foreign merchants, what makes this account truly unique is the fact that it does not charge a foreign transaction fee and will reimburse ALL ATM surcharges worldwide. In other words, you can use any ATM around the world for free.
Something to watch for: the Charles Schwab Bank’s High Yield Investor Checking Account is automatically linked with a Schwab brokerage account, but that should not be a reason to dismiss the offer. Neither account has a minimum balance requirement or monthly fees.
Best for Rewards Lovers
First Merchants Bank National Association Student Checking Account
In the past few years, checking accounts have stopped providing much in the way of rewards. Most banks advertising rewards programs really only offer discounts on merchandise from specific retailers. In fact, credit card rewards programs often provide more than five times the cash value of checking account rewards programs.
That said, if you’re looking to avoid credit card use and prefer a checking account with rewards, this account offers 1 point for every $3 spent in signature transactions. When redeemed for gift cards, this rewards program gives you the equivalent of approximately 0.28% cash back. There is no monthly fee and you won’t have to worry about the first five non-bank ATM charges, either.
Another interesting rewards program belongs to Rockland Trust Company Free Eco Checking . The no-monthly-fee account can earn up to $300 a year ($25 per month) — you receive 10 cents for every purchase over $10. Provided you make a lot of small purchases throughout the month, this account may end up offering close to 1% cash back. It is available in Massachusetts, Rhode Island, Connecticut, New Hampshire, Maine and Vermont.
Best for Students with Part-Time Jobs
Santander Bank extra20 checking
This account rewards you for depositing money and for paying your bills. You get $10 each month just for making at least two online bill payments and another $10 for having at least $1,500 direct deposited to your account. Monthly direct deposits equal to that amount will also help you avoid a $10 monthly fee – meaning you’ll easily save yourself $240 each year if you have an employer or a parent providing a regular influx of cash.
As with any big financial decision, read the fine print and make sure you check you account regularly for fraud.
