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Greg McBride

Greg McBride: A free-checking road map

By Greg McBride · Bankrate.com
Tuesday, March 15, 2016
Posted: 6 am ET

Looking for a free checking account? It may be as close as your nearest credit union.

Credit unions are more than twice as likely as banks to offer free checking accounts. Those have been on the wane at many banks in recent years, with just 37% of banks now offering no-cost checking, down from 65% in 2010.

But it’s a different story at credit unions. Bankrate.com surveyed the nation’s 50 largest credit unions and found that 76% offer checking accounts that are free -- meaning no service fees or per-transaction charges regardless of balance or activity.

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Other credit union advantages

Note that 34% of credit unions permit at least one free out-of-network ATM withdrawal per week, and the out-of-network fees that are charged tend to be lower than those at banks.

None of the credit unions surveyed require more than $100 to open an account, and two-thirds of the accounts had no minimum at all.

Bankrate also found that credit unions hit customers less severely than banks when accounts are overdrawn.  The overdraft fee at credit unions averages about $27, more than $6 below what the average bank charges.

Consumers of all ages should consider credit unions if looking for a free checking account, including the two-thirds of millennials who say they would switch financial institutions if their checking account provider raised fees.

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