Need a new checking account? How about one with free access to 30K ATMs

This is the fifth article in our series, Money Matters.

There are so many choices when it comes to opening a checking account. How should you choose your best option?

It depends on the balance that you have available, said Jeff Bentley, president and CEO of Northwest Federal Credit Union.

“If you make a lot of money — have a lot of cash on hand — then you want something that’s going to pay you some dividends on that. If you don’t have a lot of money in your account, be careful because a lot of institutions will advertise 0% checking where they don’t charge a fee. But if you don’t keep a minimum balance, or some other metric, then they’ll end up charging you a fee.”

A debit card vs. a credit card

If you use your debit card a lot, Northwest Federal will pay you back a percentage of the average balance of your checking account each month, Bentley said.

If you can keep a decent balance and use the debit card 12 times or more in a month, the credit union will pay you a percentage of your average balance.

“You’ll actually earn money on your checking account. And very few people offer that benefit,” Bentley said. “A lot of people will say they have free checking accounts, when actually you’ve got minimum balances and certain things that will trip a wire, and it turns into a fee account.”

He also explained why people should try to use their debit card versus a credit card for many of their monthly transactions. There is a difference between a debit card and a credit card:

  • A debit card provides an easy way to access a checking account. When used, a credit union or bank withdraws the cash from your checking account immediately.
  • A credit card uses the financial institution’s funds temporarily. When you use a credit card, it goes onto your credit card balance that you can pay in full or down once a month. You can opt to make a minimum payment on it and carry a balance, which typically will then incur a monthly finance charge — a percentage of what is owed.

“We don’t recommend that,” Bentley said. “We like for you to be somewhat controlled.”

Another advantage of using Northwest Federal’s debit card is that it’s available for all the products on your checking account, he said.

Access to ATMs across the DMV and more

The debit card, of course, lets you access the credit union’s ATMs, of which Northwest Federal has a network of 30,000.

“A lot of people just assume that if you’re traveling on vacation and you’re in a environment where they don’t have an ATM that’s with your bank, that you’re going to pay an ATM fee,” Bentley said.

But another benefit of a Northwest Federal checking account is that the expansive ATM network means you never have an ATM fee.

To read more articles and listen to the full discussions in the WTOP Money Matters series, click here.

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