Switching to online bank. Keep brick/mortar bank account open?

[jkushne1]

After doing enough of my own research on forums and online, I'm convinced of the benefits of opening up an account at an online bank (Ally). However, I was wondering if I should be closing my brick/mortar bank account (Wells Fargo) or just leaving a small portion of cash there.
-For those who only use online banks, has there ever been a time where you wished you had kept the brick/mortar account open?
-For those who still maintain both types of accounts, for what reasons are you still using the brick/mortar bank?

[Jack FFR1846]

I have online banking at Ally, Ablebanking and Redneck Bank to hold money at higher interest rates than my credit union. I will always keep DCU as my base institution. All bill pay is through the credit union and I use the branch and ATMs to get cash (maybe once every other month), cash savings bonds and use their change machine to easily get rid of cups of coins.

I don't know about Wells but would be afraid as I believe that they are part of the Dark Side like Bank of America and have all kinds of charges for everything under the sun, especially if you have a low balance.

Have you considered using a brick and mortar credit union in addition to the online banks?

[JohnFiscal]

You raise a valid concern. I currently primarily use Capital One 360, an online-only bank, for banking needs (followed it from Netbank to ING Orange to Capital One 360), although in the past I used a local bank (wife used the Netbank account for her own use) until they closed up shop and moved out of town.

I see little difference now between using, say, Chase Bank or Wells Fargo versus the on-line-only banks. I prefer to do all my work on-line and the b/m banks have now caught up with such like Capital One 360 in that regard.

There is a Definite Benefit, IMO, to being able to go to the local bank to (1) withdraw a large amount of cash in the event of emergency (hurricane, flooding) and (2) for needs like wire transfers or Medallion Signature Guarantees.

If going on some major trip where I might want to take several thousand dollars cash (I have done so for trips out of the country) it's simpler for me to go to my local Chase Bank. Yes, I have an old account there that I have used only a handful of times in the past 5 years, sort of inherited from my mom ...used for wiring, for large cash withdrawals and for the Medallion stamp.

The lobby of Chase has atms that dispense a lot more than I could get at other Chase atms or from Cap One ... so that saves me having to make 4-5 trips to atms. It also provides larger denominations which is useful.

[engineer1969]

I was happy with our CapitalOne360 account until one day I logged in and it required me to change my password. As part of the process a code was sent to my e-mail which never arrived. It took me a 2 hour phone call to resolve the issue. I was very unhappy and closed my account. Online banking only works when you have access.

[BogleMelon]

I have an Ally Saving account, Charles Schwab Checking account but I keep my Bank Of America account open with small part of my salary being deposited there to avoid fees. The reason I am keeping it is sometimes I need notary service and I could also need to deposit cash, which both are not being offered by online banks.

[Chris K Jones]

I keep an account at a my local bank but most of my banking is done online. I keep it for safety deposit box, notary ( they notarize free and I need things notarized frequently) and have occasionally needed MEdallion signature guarantees.

[runner3081]

We went to Ally bank about 8 years ago. We did, however, keep a Chase account open. It is the checking account and we keep the min $1,500 to avoid fees. It is nice to have a local bank with branches everywhere for depositing cash, certified checks and notary services.

[DorothyB]

I kept my credit union account open. I actually write my "hand checks" (for things like endurance rides and property taxes) from this account. The main thing I use it for is that I can go to one of several credit unions around town to get cash when I need more cash. My direct deposits go to this account and then excess funds are transferred to Synchrony and Capital One, with most going to Synchrony. I use Capital One's bill pay.

[jebmke]

We switched from BofA to USAA 8-9 years ago. I haven't been in a physical bank since we went in to close the account.

[Khanmots]

I used online banking only for the first 15 years or so of my financial life. It's only in the last 5 years that I got an account at a local brick and mortar bank so I could get a free safe deposit box.

[Edie]

Most of my banking is through Ally, but I still keep my Wells Fargo account because I can't figure out how to change on the OAG's site where (increasingly infrequent ) child support payments should be deposited. It's actually quite a hassle because Wells Fargo's minimum deposit for my checking to be fee-free is $750, which is larger than the remainder I send to Ally through direct deposit. If you don't have the headache of needing to keep Wells Fargo, I would ditch it.

Actually, now that I think about it, we have a Navy Federal account as well due to mortgage and heloc, so even if I were able to rid myself of WF, I'd still have a brick/mortar bank, although with far fewer branches.

[midareff]

We keep a brick and mortar (former Credit Union) open for when we need amounts of cash for travel that would not be practical to draw from an ATM. There are no monthly fees associated with keeping the account open with $2 in checking and $5 in savings and we have Ally transfer in a very small deposit (25 cents) and automate two withdrawals that match the total monthly so the account does not show inactive to the CU. It's all automatic, no muss, no fuss, no bother.

[Taco Knight]

I was concerned, but I've really had no need for a brick and mortar over the past three four years.

If I happen to have a lot of cash (more than I choose to keep as a personal ATM at home), I've given it to a friend who wrote me a check rather than spend the whatever for a money order. This has happened once.

If I need something notarized, I just go into any big national branch and say I'm a customer in the rare event they ask, but really they don't care and don't check for an ATM card or anything.

Oh, also most online banks are members of large ATM networks or refund all or a portion of your fees, so you might find more/simpler ATM options without a physical bank and the need for their ATMs.

I haven't had to send a certified check or anything like that, but it's not like those are free when you're a bank member anyway, so your marginal increase in cost isn't significant.

[jebmke]

Oh, also most online banks are members of large ATM networks or refund all or a portion of your fees, so you might find more/simpler ATM options without a physical bank and the need for their ATMs.

Indeed. I bank with USAA and I can go to any ATM in town. I don't carry a lot of currency so it isn't a big deal.Banking choice depends on how you use banks. I don't keep money at a bank, don't borrow. All I need is a transaction engine.

[Taco Knight]

Oh, also most online banks are members of large ATM networks or refund all or a portion of your fees, so you might find more/simpler ATM options without a physical bank and the need for their ATMs.

Indeed. I bank with USAA and I can go to any ATM in town. I don't carry a lot of currency so it isn't a big deal.Banking choice depends on how you use banks. I don't keep money at a bank, don't borrow. All I need is a transaction engine.

Yeah, it's funny, when I'm out with friends and they have to make detours to go to a specific ATM, and I just go to the bodega next door, I wonder why exactly they're paying (!!!) and not getting as much interest and not getting the convenience of using any or almost any ATM all for the benefit of some branch existing that they barely even need to go into.

[jebmke]

Yeah, it's funny, when I'm out with friends and they have to make detours to go to a specific ATM, and I just go to the bodega next door, I wonder why exactly they're paying (!!!) and not getting as much interest and not getting the convenience of using any or almost any ATM all for the benefit of some branch existing that they barely even need to go into.

I am not a big fan of the banking industry in general.

I do taxes for senior citizens. Last year I had a widow come in with a brokerage account at one of the larger regional banks. When her husband died, her bank talked her into moving his accounts from Fidelity to them and invest it in a brokerage account that they would manage.

I will make up some approximate numbers here - order of magnitude is probably pretty accurate.

On the brokerage statement there were total dividends of $5,000 of which qualified dividends were probably $4,300. When I got to the last page of the statement I found fees of $750 per quarter. Fortunately the fees were deductible on Schedule A but she was still getting stiffed. As a rule we don't comment on people's investment decisions but I was able to at least explain to her that her investment income was being eaten up by the fees. Whether she did anything or not I have no idea.

[miles monroe]

safe deposit box.

and since i have it, much easier to deposit the occasional check than with the online bank.

[KSOC]

I have Bank of America, Ally & Goldman Sachs. As soon as I pay off my Line of Credit at BOA I will close it down (checking,savings,LOC). My LOC amount waives the $25 monthly charge & they don't pay much in interest to warrant keeping much money there. I have very little in it now, enough to pay my LOC monthly. I may look at a brick & mortar for local presence but fee's will dictate my choice.

[Dandy]

As long as your brick bank doesn't charge a fee for keeping an account open, and it is convenient I would keep it open at least until you get used to having the majority of your banking with an on line bank. Ally is an excellent choice. It is nice to have a local bank when you need face to face service e.g. a signature guarantee, getting a certified check etc.

A few months ago I experienced a fraud on my brick bank and it was great to deal with the local branch person to resolve the problem quickly. Don't know how well it would be done dealing on the phone with an online bank CSR. It may be great but there was a comfort level dealing face to face. The downside is brick banks usually do not offer 24/7 service.

I have 2 online banks and have not used my brick bank much in the last year. It was convenient for atm use but my on line credit union has many no charge atms even more convenient and a $20 atm refund per month if I have to use an atm that charges. I am having issues to finally cut the cord with a local big bank I have used for over 40 years so I may always have a local bank even if I move.

[b.lock]

I was 100% bank of America and slowly started switching to Ally. Now I'm 100% Ally and have been for the last 2 years. I have my checking and savings accounts with them.

I had one issue where they messed up a cashier's check, but I called them and they fixed the problem and over nighted a new cashier's check for free. I do not keep a lot of money in my checking or savings accounts, so I'm just a regular Joe, not any sort of preferred customer, and they still gave me excellent customer service.

[TravelforFun]

I have a checking and saving account at Bank of America. I pay bills and make deposits online, and get cash from their numerous ATMs. The only times I go into a branch office is to pick up foreign currencies I had ordered online. I don't pay any fees and will keep this arrangement for the foreseeable future.

TravelforFun

[Horsefly]

I'm in the process of going through the same decisions, so I am very interested in the comments in this thread.

We've been with Wells Fargo for over 20 years. I've generally been happy with how they have treated me, or at least too happy to go through the pain of moving. When they had our mortgage, we easily avoided fees. Once we paid it off in 2015, it became a little harder. On the infrequent occasion when I had to go to a teller, it seems they always wanted me to open up a savings account or line of credit. I didn't get it until the news broke of the illegal behavior that Wells had been routinely conducting. Since then, there have been a steady stream of news stories about Wells, and not good ones. Add to that I believe Wells pays the lowest interest rate of any banks, still stuck at 0.01%.

Two things that kept me at Wells were the safe deposit boxes and the no-fee coinstar that they had in the lobby for customers. They seem to have made a corporate decision to get rid of all the safe deposit boxes, as there are no branches any where near me that still have them. They a few months ago they decided the contract they had with coinstar was "not beneficial", which I think means to Wells, as it clearly was beneficial to their customers. Now I have several pickle jars of coins.

Mostly on principal (against Wells Fargo's criminal behavior) I have now got a savings account and a checking account at Ally. I'm going to start transitioning my bill-pay and direct deposits to them, and once it is all working well I will dump Wells Fargo. I intend to meet with them and tell them all of the above, although I'm sure they won't care.

I maintain our Credit Union checking and savings accounts, and they have a brick and mortar office somewhat close. I see no reason to dump them. We actually have a line of credit there that we've never tapped into, but it probably is good that it is there.

We also have a cash management account at Fidelity, where most of our money is anyway. They will reimburse me any ATM fees, so I'll probably use that card to get cash when I need it.

Steve

[prudent]

We keep both online and B&M for a couple reasons:
- to be able to withdraw/deposit cash at times
- safe deposit box
- a place where we can be face-to-face with someone with in case of a problem or when we need a favor (e.g. when someone gives me a check and I want it cashed without any hold)
- a bank we can use if the online bank is unavailable for whatever reason

We're happy with the online bank we use but I'm not comfortable with 100% dependence on an online bank.

[Mike Scott]

Does your local bank provide a service that you would continue to use?
If not, you don't need them.
If they do, what's the problem with keeping the account?

[2015]

safe deposit box.

and since i have it, much easier to deposit the occasional check than with the online bank.

This. Although I never deal in checks (or paper of any kind, for that matter).

[Dandy]

I have a checking and saving account at Bank of America.

BofA pays 0.03% on Savings vs say Discover Bank pays 1.5% so you might want to leave the checking at BofA and put most of your bank savings elsewhere.

You can move money from your online Savings account to BofA checking in a few days. I'm not pushing a particular online bank just saying not having almost a percent and a half better yield on an FDIC Savings account is leaving money on the table.

[bloom2708]

A few reasons to keep open:

Close access if you need cash above the ATM limits
Notary Public services (my local banks seem to require you to be a customer)
Getting a bank cashier's check (To purchase a car or other large amount item)

Hard to know if any of these reasons will fall into scope. I have done all 3 in the past few months.

[jebmke]

safe deposit box.

and since i have it, much easier to deposit the occasional check than with the online bank.

SDB hard to replicate without a B&M; I don't know if there are any viable non-bank options. Probably not. Some services are hard to duplicate without a bank location.

Check processing is variable. USAA provides me a stack of postage paid envelopes so I can just drop them in the mail. If I get more than one or two checks a year that would surprise me.

[jebmke]

Getting a bank cashier's check (To purchase a car or other large amount item)

Interesting. Do dealers still demand this type of check? We have bought three cars since returning to the US. The first two we bought with credit cards and a plain personal check. The last one was free - we walked out with a zero interest loan and the manufacturers rebate paid for the deposit. They would have taken our AMEX for the deposit but then realized the rebate covered it.

[TravelforFun]

I have a checking and saving account at Bank of America.

BofA pays 0.03% on Savings vs say Discover Bank pays 1.5% so you might want to leave the checking at BofA and put most of your bank savings elsewhere.

You can move money from your online Savings account to BofA checking in a few days. I'm not pushing a particular online bank just saying not having almost a percent and a half better yield on an FDIC Savings account is leaving money on the table.

I keep around $3K in my savings account to avoid the monthly fees and protect against non-sufficient fund penalties on the checking account.

TravelforFun

[bloom2708]

Getting a bank cashier's check (To purchase a car or other large amount item)

Interesting. Do dealers still demand this type of check? We have bought three cars since returning to the US. The first two we bought with credit cards and a plain personal check. The last one was free - we walked out with a zero interest loan and the manufacturers rebate paid for the deposit. They would have taken our AMEX for the deposit but then realized the rebate covered it.

A dealer would likely accept a personal check. I bought a Lexus from an older couple, private party. They wanted a bank cahier's check. My bank did that for $0 and even called the couple to verify I had the funds. Kind of a unique scenario, but they wanted assurance (rightly so) that I wasn't scamming them.

[Exhilarate]

My B&M is BOA, due to the free no minimum checking account they require to be a Merrill Edge Preferred Rewards member. Conveniently, they have branches in every corner in NYC. I only ever use them for cash deposits or the rare cashier's check request.

Otherwise all cash holdings are with Ally.

My brother uses Capital One, where you can sort of get the "best of both worlds". Online high yield savings, as well as B&M in some cities (NY has a bunch of locations)

[SuperGrafx]

Absolutely keep your brick and mortar account open.
If nothing else, for the convenience of having the ability to walk in and conduct business in person.

These 'online only' posters really worry me sometimes.

[DetroitRick]

While my primary bank is online, yes, I keep a local account too (actually 2). I could survive in online only mode, but it is not my preference. In spite of the fact that I actually only set foot in a local bank bank about twice per year. The size of account balances needed to keep this free is small (so "lost" interest is therefore trivial to me).

The utility I get from having local banks:
- Safe deposit box at a reasonable rate in a very convenient location (5 minutes away).
- Branch convenience to my home (and formerly office) is stellar - ATM's and branches are everywhere I go. Including other states.
- Foreign currency service is fast (next day), easy and cheap
- Medallion service (rare, but it still comes up)
- Free, fast certified checks (yup, some clowns still insist on it these days)
- Better-designed app for smartphone
- Free notary service
- Really great customer service (surprises me too) for those rare times when needed. Better, faster and more knowledgeable than my online banks.

When I move, I'll reassess in light of local banking quality. But for now, I'm unwilling to drop local banking.

[Freefun]

I keep a local Chase account. Fantastic service - they'll do notary and medallion stuff for me and never charge anything. I happen to have a safe deposit box there but would keep the account anyway. Its nice to have a real person when needed.

+1 above for their great app esp when you have many Chase cards.

I have an account with Citibank which I valued because they had branches where I lived overseas. I've been meaning to close it since they charge fees and I find their service terrible (at least when I try calling on the phone)

[Khanmots]

Absolutely keep your brick and mortar account open.
If nothing else, for the convenience of having the ability to walk in and conduct business in person.

These 'online only' posters really worry me sometimes.

I just don't see the convenience of doing things in person. Online lets me do things on my schedule, without any line or hassle, and there's no people in the loop to screw things up. That it also keeps my banks costs way down is just gravy; B&M bank customers are paying a lot for that physical presence.

[mega317]

Ally won't, or at least two customer service reps have told me they won't, let me deposit a check made out to my infant. Chase actually won't accept mobile deposit either but in the branch is no problem.

[oldcomputerguy]

We have our savings at Ally, but we do maintain our brick-and-mortar checking account for ATM access and a safe-deposit box at the local branch. If it weren't for the safe-deposit box, however, I think we'd likely close the B&M account, as we can do pretty much everything else we need from a bank with other options.

[Tallis]

I keep an account at a local credit union for the reasons others give: safe deposit box, medallion signature, getting cash or cashiers checks. The credit union also services our mortgage, and is quite responsive when I've had a issue.

This account costs us nothing (well, except for the safe deposit box).

Of course, we keep our emergency fund and other cash reserves in on-line banks, for the better interest rate offered. We also have a Schwab checking account, which is helpful

[Sandtrap]

After doing enough of my own research on forums and online, I'm convinced of the benefits of opening up an account at an online bank (Ally). However, I was wondering if I should be closing my brick/mortar bank account (Wells Fargo) or just leaving a small portion of cash there.
-For those who only use online banks, has there ever been a time where you wished you had kept the brick/mortar account open?
-For those who still maintain both types of accounts, for what reasons are you still using the brick/mortar bank?

It is convenient to have both, an account at Wells Fargo (I do) and setup an ACH transfer link between the 2 accounts.
Keep enough in the "brick and mortar" bank to avoid monthly minimum fee charges. Different fees at various banks.
There's no disadvantage to having both.
But, in the times when you need a bank with a physical location with many of the advantages other posters have responded with, and more.
It is better to have it than to not have it when you need it.

aloha
j

[midareff]

After doing enough of my own research on forums and online, I'm convinced of the benefits of opening up an account at an online bank (Ally). However, I was wondering if I should be closing my brick/mortar bank account (Wells Fargo) or just leaving a small portion of cash there.
-For those who only use online banks, has there ever been a time where you wished you had kept the brick/mortar account open?
-For those who still maintain both types of accounts, for what reasons are you still using the brick/mortar bank?

It is convenient to have both, an account at Wells Fargo (I do) and setup an ACH transfer link between the 2 accounts.
Keep enough in the "brick and mortar" bank to avoid monthly minimum fee charges. Different fees at various banks.
There's no disadvantage to having both.
But, in the times when you need a bank with a physical location, you will have it.

aloha
j

and program Ally to send a receive back a few pennies a month so the account doesn't look inactive to their database.

[Sandtrap]

After doing enough of my own research on forums and online, I'm convinced of the benefits of opening up an account at an online bank (Ally). However, I was wondering if I should be closing my brick/mortar bank account (Wells Fargo) or just leaving a small portion of cash there.
-For those who only use online banks, has there ever been a time where you wished you had kept the brick/mortar account open?
-For those who still maintain both types of accounts, for what reasons are you still using the brick/mortar bank?

It is convenient to have both, an account at Wells Fargo (I do) and setup an ACH transfer link between the 2 accounts.
Keep enough in the "brick and mortar" bank to avoid monthly minimum fee charges. Different fees at various banks.
There's no disadvantage to having both.
But, in the times when you need a bank with a physical location, you will have it.

aloha
j

and program Ally to send a receive back a few pennies a month so the account doesn't look inactive to their database.

Yes!
Forgot about that one. Inactivity fee or automatic close due to inactivity.
j

[KlingKlang]

I use Huntington with an interest bearing checking account as our B&M bank and PurePoint for online savings.

I cash 30 year old paper Savings Bonds in on the first of every month and Huntington handles this flawlessly. Since I'm there anyway I also use the checks from my Vanguard MM account to withdraw funds, which I prefer over ACH transfers.

An important factor in keeping our B&M bank is that my wife won't go within ten feet of a computer, smart phone, or ATM, so she really needs a financial institution that she can walk into in case I drop dead.

[radiowave]

Have both B&M + online high yield savings.

B&M bank:
- longest credit history so that helps my FICO scores
- I bring my pile of coins there every few months
- Nice having a donut once and a while
- my B&M has a randomized credit card number for online purposes to mitigate fraud
- also get check images which can be edited
- small amt of paycheck each month deposited to avoid ransom (sorry monthly fees)
- the bank has a rare ATM only card and an ATM machine on the way to work
- availability of safe deposit box but have never used one.
- charges me to ACH withdraw funds from checking

Online bank:
- 1.45% savings
- 2.0% 1yr CDs
- easy to use photo check deposit
- I tried to deposit my coins by inserting them into the slot on the side of my laptop but didn't work for some reason and now my DVDs don't work any more ugh
- my online bank doesn't charge me for withdrawing/ACH from my accounts (see note about ransom above at my B&M bank)

[flamesabers]

So long as there are no fees and no high minimum balance requirements, I think it's worthwhile to keep your brick & mortar bank account open. One reason I keep my brick & mortar bank accounts open is I still have paper checks associated with these accounts. Even though I seldom write checks, I like using the ones I already have versus having to shred old ones and then reorder new ones for the rare times I do need to write a check. Another reason is I maintain these accounts as a backup in case my online bank account gets closed or otherwise gets targeted with fraud. As much as I like online banking, if I'm going to have problems with my bank account I would much rather deal with a brick & mortar bank then an online bank.

[not4me]

I have both & no plans to change that. As much as anything, I don't want to plan to have a potential single point of failure in case things don't work as they are expected to. Depending on your preference in "disasters", either can have problems. Online may have denial of service attacks, ransomware incidents, etc; Brick/mortar can have fire, flood, tornado, etc.

[kaudrey]

I ditched Citibank for Capital One 360 a few years ago. Although, here it is a little like cheating, because there are Capital One ATMs in the metro stations and airports, and Capital One branches all around the downtown area. I use the ATMs all the time; I have yet to walk into one of the actual banks.

[TheDDC]

I haven't had to send a certified check or anything like that, but it's not like those are free when you're a bank member anyway, so your marginal increase in cost isn't significant.

My credit union offers free cashier's checks mailed to me or to a payee of my choice. Very nice service. Works like bill payer.

-TheDDC

[wolf359]

I like having a brick and mortar bank around, although in my case technically it is a credit union. I'd specifically ditch Wells Fargo, though. They're under penalties for their multiple fraud issues, and are now limited in how much they can expand their assets. Therefore, any profit growth will have to come from existing customers (that is, more fees). Not a good time to be a Wells Fargo customer. Source: https://www.bloomberg.com/news/articles ... -precedent

[investor997]

Getting a bank cashier's check (To purchase a car or other large amount item)

Interesting. Do dealers still demand this type of check? We have bought three cars since returning to the US. The first two we bought with credit cards and a plain personal check. The last one was free - we walked out with a zero interest loan and the manufacturers rebate paid for the deposit. They would have taken our AMEX for the deposit but then realized the rebate covered it.

Dealers will take a personal check but usually not until they've run a credit report.

For private party sales, any time I sell a car to an individual I insist on going to the buyer's bank and standing next to them at the teller window when they get cashier's check. That way I know 100% beyond any doubt the check is good. There may be other ways of verifying funds (ie calling the bank) but this method has always worked for me and I'll continue to insist on it.