How to Choose a Bank After College

After college your priorities change, from losing that freshman 15 to finding a job and making a five-year plan. Have you considered whether your bank falls in line with your new goals? One of your first “real world” decisions will be choosing the right financial institution for your needs.

Switch or stay?

You’ve grown up, and so, too, must your bank account. Most student accounts come with an age limit or will expire four or five years after they were opened. Once you no longer qualify, most banks and credit unions will roll your student version into a standard account. They’ll want to make the transition as smooth as possible so that you don’t leave. But go for clarity over convenience, because non-student accounts can come with new requirements — and fees. And besides, you might want more perks or features.

If you’re happy where you are, and your bank and its accounts fit the next phase of your life, great. If not, or you’re unsure, consider what else is available.

» MORE: NerdWallet’s best checking accounts and debit cards

Choosing a new bank

Where you move your money to will depend on what’s next for you and how you like to do things.

• If you plan to travel or aren’t sure where you’ll live next, a big national bank might be the way to go because it will have more branches across the country. And if you would rather do all your banking in one place, bigger banks tend to have more accounts and products to choose from.
• If you’re staying put after college and enjoy a little more personal attention, try a local credit union or community bank. As nonprofit, member-owned institutions, credit unions on average offer higher interest returns on savings and deposits and charge lower fees than banks do, and both earn strong marks for customer service.
• If you prefer to handle your finances through an app or on your computer — really, how many times did you drive to the bank during college? — an online-only bank could be the right fit. These banks can offer better rates because they don’t have the financial burden of keeping up physical branch locations.

Check their ATM network and policies to ensure you’ll have access to cash wherever you go and that fees are low or reimbursable. And look into their online and mobile offerings for features like bill pay, mobile deposits and person-to-person payments.

Don’t feel pressured to choose only one institution. Mix and match accounts as you please so that you get the best deal.

» MORE: How to choose a bank

What accounts to consider

When you start working, it’s time to kick off good saving habits. Depending on your financial goals, some of these accounts could merit a closer look.

• A regular checking account might come with more fees and requirements than your student account did, but often you can avoid the fees by setting up direct deposit of your paycheck or making a number of debit card purchases each month. Look for a lenient overdraft policy, in case you make a mistake and spend more than you have. And because you’re just starting out, you might not want an account that requires too large a minimum balance, even if it promises rewards.
• Savings accounts come in three varieties: a basic savings account, a money market account and a certificate of deposit, or CD. The best interest rates can be found in a high-yield online savings account or in a CD — but the latter means making a commitment to not touch your money for a set period of time, so be careful.

» MORE: How to choose a bank account

Open the new account(s)

To open a new account, you’ll likely need to provide a new bank with your Social Security number as well as photo identification, such as a driver’s license, state ID card or passport. You can close your current checking account first or take out only enough money for an initial deposit in your new account.

Change your settings

Once you have a new bank account, remember to switch account information on any direct deposits or automatic bill payments you have and update any linked accounts on shopping websites. And during the transition, keep a close eye on your accounts to avoid possible errors. 

Get ready for adult responsibilities

Choosing the right bank account after college is a great first step, but there are plenty of other financial matters to attend to. A bank account alone will not make it easier for you to pay off your student loan debt, and even though it seems far away, you need to start planning for retirement. The earlier you get started, the better.

Melissa Lambarena is a staff writer at NerdWallet, a personal finance website. Email: mlambarena@nerdwallet.com. Twitter: @LissaLambarena. NerdWallet writer Anna Helhoski contributed to this article.

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