I’m always surprised when I see new construction along busy commercial corridors and later learn that it will become a new branch of XYZ Savings Bank.
Presumably, the rise of ATMs dramatically reduced the number of banking transactions handled by a bank teller. Today, it’s possible to most banking on a smartphone including (at least at some banks) depositing checks.
Yet banks are still investing millions in branches. Not because we need more places to take our rolled coins, but because those branches serve as sales offices where the banks can open new accounts and loans.
There are times – like applying for a mortgage or getting a business loan – when there’s little substitute for a face-to-face meeting with somebody who can get to know your needs and walk you through a complicated application.
But the other 99 percent of the time, what we need are simple savings and checking accounts that work well and don’t cost much.
Free checking accounts are hard to find…
Recently, that last part has become a sticky issue.
I’m sure, at one time or another, almost everybody has encountered a so-called free checking account that’s not really free. These accounts either require minimum average balance to waive a monthly fee or they charge fees for everything else you want to do, like using an ATM.
And let’s not forget overdraft charges of $30-$40 for the “privilege” of spending money that’s not in your account. Fortunately, you can opt out of this service so that non-sufficient funds (NSF) transactions will be declined instead.
…unless you know where to look
New products are popping up that challenge traditional checking accounts. Online checking and bill-pay accounts like those offered by Capital One 360 and FNBO, offer free no-minimum balance checking accounts – there just aren’t any branches.
And just this year, American Express launched a new product called Bluebird, that’s not exactly a checking account, but you’d be hard-pressed to tell the difference.
(*Disclaimer: This Website has affiliate relationships with the aforementioned products.)
About Amex Bluebird
Bluebird is positioned as a checking and debit alternative, except that it comes with a free debit card, and for $26, a book of checks.
Bluebird promises no monthly fees, overdraft fees, or minimum balance requirements. Bluebird includes online bill pay, ATM access, and mobile account management. And as long as you have something directly deposited into the account each month, Bluebird’s only fees are $2 if you load the account with a debit card, $2 for an out-of-network ATM, and $26 for a book of checks.
(Bluebird uses the MoneyPass ATM network, which from what I can tell includes a mix of credit unions, local banks, and ATMs in certain national chain stores.)
Banking without a bank
Although American Express is a bank – they don’t have branches like Bank of America or Chase where you could saunter in and deposit the $2,500 cash you made from selling your old valuable guitar last weekend. To solve that problem, Amex has affiliated Bluebird with WalMart, so you can deposit cash to a BlueBird account at virtually any WalMart cash register.
Bluebird also offers up to four sub-accounts, which can be used to separate expenses or share an account with family members (think giving a teenager an allowance). Each sub-account gets its own debit card. If desired, users can set daily spending and ATM limits on sub-accounts.
Admittedly, it’s hard to innovate around something as mundane as a checking account. They’re heavily regulated, and even so, there’s not much marketers can do to make them different or exciting. But Bluebird’s sub-accounts is an admirable step. I’ve found the sub-accounts in my Capital One 360 savings account quite useful for segregating money in my emergency fund from money I want to use to buy my next car.
Who Amex Bluebird is for
I could see American Express Bluebird being a convenient alternative to a traditional checking account for many – especially if you bank primarily online or could use the sub-account feature (such as separating individual expenses from those you split with a roommate or significant other). In that case, it could also be a useful secondary account for keeping track of shared household expenses, club funds, or other unique situations in which a traditional checking account could be a hassle.
What do you think? Would you use a product like Bluebird as a checking account alternative? Why or why not? How do you get around checking account fees?