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Are Checking Accounts No Longer A Good Idea?

Author: Scott Burleigh

Are checking accounts no longer a good idea?

For many people, a checking account is the foundation of their finances. These easy-to-use accounts make funds readily available with the use of a debit card.

However, recent changes to the way major banking institutions are approaching their debit cards may end up discouraging you from using your checking account as the fulcrum around which you center your savings.

Wells Fargo, JPMorgan Chase and Bank of America, to name just a few, are all changing their debit card policies in a number of different ways. The first two have both gotten rid of their debit card rewards programs - initiatives to promote card use that granted a series of perks to cardholders. Additionally, both are adding new monthly fees associated with these cards.

Meanwhile, Bank of America is keeping its rewards, but adding requirements stipulating that cardholders must spend a certain amount with their plastic checkbooks each month, or else end up incurring a number of surcharges.

Alternatives to using debit cards obviously exist - standard credit cards are the most obvious of these. Credit cards, of course, come with plenty of restrictions and regulations of their own.

Prepaid credit cards are another alternative. They allow you to perform nearly all of the functions available through a debit card, other than actually writing checks. If traditional check writing is not a priority, than this option is worth considering.

These cards have been growing in popularity due to their usefulness. As a result, it might not be long before banks start applying the same irritating fees and stipulations currently associated with certain debit cards to prepaid credit cards. So, in the long run, it's entirely up to you how you manage your purchases - you have to do what's best for your money. 

How often do you use your debit card?

In Brief

  • For many people, a checking account is the foundation of their finances.

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