Charles Schwab Bank Review: Account Good for You?

Charles Schwab is more than a brokerage. It also offers high yield checking and savings interest rates that might far surpass your local bank. Read on to learn the pros and cons.

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.

Compare Savings Account Promotions

CIT Bank Bonus Offer: $300 for New and Existing Customers
CIT Bank now offers up to $300 cash bonus for new and existing CIT Savings Builder customers. This limited time promotion expires May 30, 2020. Conditions apply.
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Discover Online Savings - $200 Cash Bonus
To get your $150 or $200 Bonus offer: What to do: Apply for your first Discover Online Savings Account by 4/6/20, 11:59 PM ET, online or by phone. Enter Offer Code CY320 when applying. Deposit into your account a total of at least $15,000 to earn a $150 Bonus or deposit a total of at least $25,000 to earn a $200 Bonus. Deposit must be posted by 4/20/20, 11:59 PM ET. Maximum bonus eligibility is $200.
What to know: Offer not valid for existing or prior Discover savings customers or existing or prior customers with savings accounts that are co-branded or affinity accounts provided by Discover. Account must be open when bonus is credited. Bonus will be credited to the account by 5/4/20. Bonus is considered interest and will be reported on IRS Form 1099-INT. Offer may be modified/withdrawn without notice. See advertiser website for full details.
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Expires 4/6/2020

Betterment Everyday - Earn up to 0.30% APY
• FDIC insurance covering up to $1,000,000 at program banks
• Access cash in 1-2 business days
• No minimum balance
• No fees on balance
• Unlimited withdrawals
Start Saving

Compare Checking Account Promotions

Chase Premier Plus Checking℠
• Enjoy $300 as a new Chase checking customer, when you open a Chase Premier Plus Checking℠ account and set up direct deposit.
• Enjoy $300, more benefits, and earn interest on your new Chase checking account.
• The $25 Monthly Service Fee is waived when you keep an average beginning day balance of $15,000 or more in any combination of this account and linked qualifying Chase checking, savings and other balances.
• No Chase fee on first four non-Chase ATM transactions per statement period.
• Earn interest on your checking account balance.
• Access to 16,000 Chase ATMs and nearly 4,900 branches
• Open your account online now.
• Available online nationwide except in Alaska, Hawaii and Puerto Rico. For branch locations, visit locator.chase.com.
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Chase Total Business Checking®
• Get $200 as a new Chase business checking customer, when you open a Chase Total Business Checking® account with qualifying activities
• Access to 16,000 ATMs and nearly 4,900 Chase branches
• Chase has business specialists at your local branch to help with your business needs
• Account Alerts are a great way to stay on top of your account's activity and enhance security
• Unlimited electronic deposits at no charge, including Chase QuickDeposit℠, ACH and ATM
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HSBC Advance Checking - Up to $350 Cash Back
Get up to $350 with a 2% Cash Back Checking Offer when you open a new HSBC Advance checking account and complete the following qualifying activities.
• Open your new HSBC Advance checking account by March 29, 2020; and
• Set up Qualifying Direct Deposits into your new HSBC Advance checking account; and then
• Enjoy 2% Cash Back on Qualifying Direct Deposits into your new HSBC Advance checking account, up to $30 per month, during the first 12 calendar months after account opening — up to $350
• You will automatically receive the 2% Cash Back in your new HSBC Advance checking account approximately eight weeks after completing that month's qualifying activities.
• Deposit products are offered in the U.S. by HSBC Bank USA, N.A. Member FDIC.
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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 - 1.50% APY - Learn More
	Benefits and Features
Savings	0.05% APY	1.50% APY
CD	Offers brokered CDs from other banks. Terms range from 1 month to 20 years. Minimum deposit of $1,000.	0.50% to 1.75% APY. Terms of 3 months to 5 years. 12-month CD APY of 1.50%
Checking	0.03% APY, $0.01 account minimum	0.10% APY under $15,000; 0.50% APY $15,000 or more
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 - 1.50% APY Interest Checking Money Market
Charles Schwab Bank: Pricing information from published website as of 03/28/2020. Ally Bank: Pricing information from published website as of 03/28/2020.

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.

You might also consider:

CIT Savings Builder - Earn 1.75% APY
Earn up to 1.75% APY. Here's how it works: Maintain a minimum balance of $25k OR make at least a $100 minimum deposit every month. Member FDIC
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Discover Online Savings - $150 Cash Bonus
To get your $150 or $200 Bonus offer: What to do: Apply for your first Discover Online Savings Account by 4/6/20, 11:59 PM ET, online or by phone. Enter Offer Code CY320 when applying. Deposit into your account a total of at least $15,000 to earn a $150 Bonus or deposit a total of at least $25,000 to earn a $200 Bonus. Deposit must be posted by 4/20/20, 11:59 PM ET. Maximum bonus eligibility is $200.
What to know: Offer not valid for existing or prior Discover savings customers or existing or prior customers with savings accounts that are co-branded or affinity accounts provided by Discover. Account must be open when bonus is credited. Bonus will be credited to the account by 5/4/20. Bonus is considered interest and will be reported on IRS Form 1099-INT. Offer may be modified/withdrawn without notice. See advertiser website for full details.
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Expires 4/6/2020

Online Savings Account - Earn 1.50% APY
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• No fees
• No minimum opening deposit
• No minimum balance required

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.