I (19M) started investing and saving about half a year ago, and have been using both Wealthfront and BofA for investing/checking respectively. The last couple of years, though, BofA has been giving me trouble in the customer service arena, as well as their interest rates on savings being dong water. I have a CC with them, and will keep it, but I’m looking to move my money elsewhere. Wealthfront offers a hysa with a debit card, and I can link my DD to it, so I was curious if there was some kind of risk/downside to that. Maybe I should use a bigger bank? Maybe even dump Wealthfront and use some bigger names? Any advice is helpful
What bank should I use?
byu/lords_of_the_ballin inpersonalfinance
Posted by lords_of_the_ballin
7 Comments
Ditch BofA for sure, their savings rates are trash. I’ve been using Wealthfront’s cash account for like 2 years now and it’s solid – no weird fees and the rate actually keeps up with fed changes. Only downside is limited ATMs but they reimburse fees so whatever
You can have multiple checking, savings and brokerages so I’d do a bit of research and try a few and then settle on the one you like. Couple general tips:
You should have at least 2 checking and one should be local, the other can be a web-based checking.
Your savings account(s) should be HYSA. I really like SoFi and Discover but I think Ally is another good option.
For Brokerage there are a lot of options and depends on what features are import to you. Robinhood is a good starter brokerage and I love SoFi. You can also use the main ones, Fidelity and Schwab.
Good luck!!!
Definitely try to get a good rate on your savings (currently good is in the 3-4% range). Wealthfront HYSA looks good. HYSAs have no risk as long as they are FDIC insured. For downsides, it just really depends on well you can pay your bills and access your money. Sounds like you shouldn’t have a problem with this since you have a debit card linked to it and have a credit card.
Are you getting rewards on your credit card?
Try [Schwab Bank](https://www.schwab.com/client-home). With a linked brokerage account, everything I need a bank to do for me is free. Downside: no brick & mortar office.
If you don’t need deposit cash, Fidelity has a cash management account that works great as a checking account. The fidelity debit card that linked to the CMA will be reimbursed for all ATM fees world wide. I think they offer free checks (if you needed them). And best of all they have autosweep, so as soon as you put money in the account, it will instantly purchase SPAXX and start making you 3.5% or so. And as soon as you purchase something with your debit card or you setup a payment for your BOA credit card, or in any way transfer money out of your CMA, the SPAXX instantly sells the exact amount you need to cover the transaction.
Plus Fidelity has very few fees and unlike vanguard, there are generally no minimum initial investment amount for most of there mutual funds. Or you can use ETFs, or purchase T-bills directly from the auction. They have just about every type if investment you can think of, plus lots and lots of learning material on there website to teach you all about different types of investments.
But be aware, while fidelity has bank-like features, they are not a bank. They use other banks to have those bank-like features. While Fidelity offers fee-free incoming and outgoing domestic wires, they are not part of the Zelle network.
While I used fidelity for all my money (including banking) for a couple of years, I recently decided to move my banking to Chase and JP Morgan. I never had any issues with Fidelity, I just decided that having all my eggs in one basket is not the greatest idea.
You should always have one local checking, find a local credit union that wont screw you. Next open up an account at Vanguard or Fidelity where they have low cost index funds and park your investments there if you are just a retail investor.
You should open a Chase account. Idk where you live or if you wanna move out of there but Chase is kinda americas bank and they’re everywhere. You just might have to drive a lil.
Chase got whatchu need and they even have self investment in the app. It’s just like Robinhood but in the Chase app.
Keep your other accounts open. You can have Zelle hooked up with an alternate email that way you can move money around for bills. It’d be a pain in the ass to have to re set up all those auto payments you probably have set up.
Go sit with an RB and be honest about what you got and they’ll suggest what account types would be best for you and they’ll make sure that everything is connected so you don’t get charged a fee. You could even do a balance transfer of your credit card over to them.
They have home financing, auto financing, self investing, hysa, checking and savings, eventual access to a financial advisor if you want one. They have business bankers if you ever decide to open a business or if you have one, if you ever need to scale up your business.
You can take your time switching over the auto payments this way and ditch BoA if the customer service keeps getting on your nerves.
I think a bank you can walk into is important, but also having an online bank (like Discover) is great because they don’t have to charge you fees to keep the lights on a bunch of buildings open. I think there’s like maybe 3 buildings for the banking side of Discover and they’re all in Arizona.