Charles Schwab Bank Review: Account Good for You?

Many people don't realize that the household name for investment brokerages also offers a couple of banking options. While their options are simple - just checking and savings, they do pack quite a punch. You'll have to be tech savvy as you can only access your funds online, which can make the task of making deposits interesting for some.

Charles Schwab does offer some beneficial bank account options that may help you save more than the penny or two that you'll save at your local bank.

If you're considering opening a personal checking or savings account, you must check out these promotions.

Services Offered

If you're looking for a wide selection of account options, you won't find them here. Charles Schwab keeps it simple with just a high-yield checking and high-yield savings account. Both accounts are strictly online, but if you have a branch near you (there are 340 in the United States), you can try to conduct your business there. Not all branches are capable of handling banking tasks, though.

You can open the high-yield checking account online in a matter of minutes. There is a catch, though. In order to open a checking account, you have to first open a Schwab One Brokerage account. You don't ever have to do anything with the account, but they make you open it and then automatically assign you a checking account with a separate account number.

In order to open the savings account, you have to download the application, complete it and mail it to Charles Schwab. It will take a little longer to get the account up and running since you have to wait for the snail mail, but the process is simple.

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Reasons We Like Charles Schwab Bank

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• You don't have to pay any monthly fees. You might be able to find higher interest rates elsewhere, but you will be hard-pressed to find another online bank that doesn't charge monthly fees. The lack of fees can make up for the slightly lower interest rates.

• You don't need a minimum balance. It's always a nice feeling when you don't have to worry about carrying a minimum balance or risk getting charged a fee. Charles Schwab doesn't require a balance for either their checking or savings accounts.

• You can get your ATM fees refunded. If you've dealt with the frustration of getting charged to take your own money out of an ATM, you'll love Charles Schwab's ATM refund policy. If you withdraw the funds using your Schwab Visa debit card at an ATM that accepts the Visa debit card, Schwab will refund you the ATM fee. There is no limit on the number of refunds you can get either.

• You can make mobile deposits. Making deposits without a physical branch to visit might seem complicated, but Schwab makes it simple. After you open your account, apply for Schwab Mobile Deposit. Once approved, you take a picture of your check with your smartphone and upload it to the Mobile Deposit service.

• You get free standard checks and a free ATM card. Free standard checks and a free ATM card are two more ways you can save money with Charles Schwab's banking service.

• You can set up direct deposit for checking or savings. If you want to simplify the funds transfer process, set up automatic deposit into your checking or savings account. These deposits are available the same day, unlike ACH transfers from another bank.

• You can use Schwab's free bill pay service. Rather than transferring your funds here, there, and everywhere, you can take advantage of Schwab's free bill pay service. Paying your bills right from your high yield checking account can alleviate some of the headache of transferring funds.

• You can use contactless payments such as Apple Pay and Android Pay. Just link your checking account to the eligible device and you can easily and securely pay vendors and retailers.

• You have FDIC coverage. Your deposits (up to $250,000) are protected by FDIC insurance. This means should something happen to Charles Schwab Bank, your money is still safe.

• You can have free overdraft coverage. If you have available funds in an eligible Schwab brokerage or online savings account, Schwab will cover your overdrafts in your checking account at no charge. This isn't a green light to make overdrafts, but at least you know you have the coverage should it happen.

Reasons You May Want to Look Elsewhere

• Your deposits or money transfers can take a long time. During the first 30 days of owning the account, any checks you deposit that aren't cashier's checks or government-issued checks are held for five business days before the funds become available. Some deposits made with Schwab Mobile Deposit after the first 30 days may also be held for an extended period (Schwab notifies you of the exact waiting period after the deposit).

• You have to bank online even if you have a Charles Schwab bank in your area. The point of an online checking or savings account is for you to handle your transactions online. This decreases the amount of overhead required for the bank to offer these accounts, which results in higher interest rates. Not all Schwab branches have the ability to accept deposits or help with any banking transactions, leaving you to operate online.

• The only type of account you can open is checking or savings. The only two banking options you have are the checking or savings accounts, both of which offer minimal interest compared to other options, such as CDs. If you have long-term savings needs, you may want to look elsewhere to make more interest.

How it Compares

Charles Schwab Bank vs Ally: Schwab and Ally Bank both offer online banking, but the similarities end there. If you are looking for more than checking or savings, Ally Bank has more options, including money market accounts, CDs, and IRAs.

	Charles Schwab Bank	Ally Bank
	SPECIAL OFFER High Yield Investor Checking – Unlimited ATM Rebates - Learn More	SPECIAL OFFER Online Savings Account - Learn More
	Benefits and Features
Savings	0.50% APY	2.20% APY. No monthly service fee and no minimum deposit.
CD	Offers brokered CDs from other banks. Terms range from 1 month to 20 years. Minimum deposit of $1,000.	0.75% to 3.00% APY. Terms of 3 months to 5 years. 12-month CD APY of 2.75%. No minimum deposit to open.
Checking	0.40% APY, $0.01 account minimum	0.10% APY under $15,000; 0.60% APY $15,000 or more. No monthly service fee and no minimum deposit. Ally will refund ATM fees for other banks up to $10 per statement cycle.
Customer Service	24/7 Live Customer Service (Telephone and Chat)	24/7
ATMs	Unlimited ATM fee rebates when used with ATMs with the Visa, Interlink logo. Available worldwide.	Over 43,000 no-fee Allpoint ATMs
Locations	345 branches across the country. You may also open an account online.	Online Only
	High Yield Investor Checking – Unlimited ATM Rebates	Online Savings Account Interest Checking Money Market
Charles Schwab Bank: Pricing information from published website as of 4/19/2019. Ally Bank: Pricing information from published website as of 4/19/2019.

Charles Schwab Bank vs Capital One 360: Capital One 360 also offers more products than the Charles Schwab Bank offers. If you want more than checking or savings, you can open a money market or IRA account. They also have Capital One branches, known as cafés, located throughout the US.

	Charles Schwab Bank	Capital One
	SPECIAL OFFER High Yield Investor Checking – Unlimited ATM Rebates - Learn More	SPECIAL OFFER Capital One MMA - Learn More
	Benefits and Features
Savings	0.50% APY	1% APY. No monthly service fee and no minimum deposit.
CD	Offers brokered CDs from other banks. Terms range from 1 month to 20 years. Minimum deposit of $1,000.	0.60% to 3.10% APY. Terms of 6 months to 5 years. 12-month CD APY of 2.70%. No deposit to open.
Checking	0.40% APY, $0.01 account minimum	0.20% APY under $50,000; 0.75% APY $50,000 or more; 1.00% APY $100,000 or more. No monthly service fee and no minimum deposit. Overdraft options prevent you from being charged when you accidentally overdraw
Customer Service	24/7 Live Customer Service (Telephone and Chat)	Mon-Sun 8am - 11pm (ET)
ATMs	Unlimited ATM fee rebates when used with ATMs with the Visa, Interlink logo. Available worldwide.	Over 39,000 no-fee Capital One & Allpoint ATMs
Locations	345 branches across the country. You may also open an account online.	Online Only
	High Yield Investor Checking – Unlimited ATM Rebates	Capital One MMA Capital One 360 Checking - $25 Offer Capital One 360 Saving - $25 Offer
Charles Schwab Bank: Pricing information from published website as of 4/19/2019. Capital One: Pricing information from published website as of 4/19/2019

Charles Schwab Bank vs Barclays Bank: If you are strictly looking for savings accounts, Barclays offers a high-yield savings account as well as CD options. They do not require a minimum balance or charge monthly service fees for the CDs.

	Charles Schwab Bank	Barclays
	SPECIAL OFFER High Yield Investor Checking – Unlimited ATM Rebates - Learn More	SPECIAL OFFER Online Savings Account - 2.20% APY - Learn More
	Benefits and Features
Savings	0.50% APY	2.20% APY. No monthly service fee and no minimum deposit.
CD	Offers brokered CDs from other banks. Terms range from 1 month to 20 years. Minimum deposit of $1,000.	0.35% to 3.05% APY. Terms of 3 months to 5 years. 12-month CD APY of 2.70% APY. No minimum deposit to open.
Customer Service	24/7 Live Customer Service (Telephone and Chat)	Mon-Sun 8am - 8pm (ET)
Locations	345 branches across the country. You may also open an account online.	Online Only
	High Yield Investor Checking – Unlimited ATM Rebates	Online Savings Account - 2.20% APY Online CDs
Charles Schwab Bank: Pricing information from published website as of 4/19/2019. Barclays: Pricing information from published website as of 4/20/2019.

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Bottom Line

If you want to make a little more interest than your local bank offers and can manage your money online, Charles Schwab Bank can be a good option. If your goals are more long-term and you can tie your money up for a few months to a few years, you may want to look at other online options that offer CDs and money markets, as you can often get higher interest rates with those products.