Any reason why i shouldn't use an online bank as my primary bank?

[maynard]

Im looking to move my checking and savings accounts to another bank. Mainly because i moved and my bank has no atms anywhere near my new city.

Ive never used an online bank before, but Ally, ING, and the rest have pretty good rates and good reputations.

i dont see any reason to have a brick and motor bank at. Is there any reason why i should still have a brick and motor bank and just use the online bank as a secondary bank?

My finances are pretty simple. Direct deposit twice a month. Never any other deposits. I pay all my bills online. I write about 3 or 4 checks a year at most. I use a debit card or cash for 100% of my purchases.

Do i really need a brick and motor bank at all????

[jpg7n16]

There are a couple advantages:

-what if something goes wrong on your account, and you want to make sure someone's looking into it today? brick: go in and talk to personal banker, ask him/her all your questions; online: call/email, not sure how the service is online (most places I ever call put me on hold. would be shocked if online banks aren't the same)
-what if your debit card cracks or the magnetic strip goes out? how would you get cash? (I guess you could write a check, but where would you cash it?)
-adding people to the account at a physical bank would be easier
-getting a cashier's check is easier/cheaper if you have an account already

... basically, account maintenance stuff IMO is better done in person.

As far as transactions and stuff goes, there's no real difference between the two.


Is that enough to say you need a physical bank? I don't think so. It's just more convenient for me.

[kork13]

I've never used a brick-and-mortar bank, and couldn't be happier. That said, the main reasons that might dissuade someone from going 100% online for banking would be:
- Frequent (>1/mo) cash/check deposits. Almost zero online banks accept cash deposits. Some don't even accept check deposits. This would precipitate a need for another institution which can electronically transfer the funds to your online accounts.
- As jpg brought up, many account maintenance functions can be more easily done in person. However, many others (such as changing addresses/contact information) are easier online.
- You just prefer to work face-to-face with people. This is a legitimate concern for some people, who want to have a face to associate to individuals they are working with.

However, it doesn't sound like you have any of these problems... so I would say 'Full steam ahead!' on going online. It's really all about finding the right institution to work with. I use USAA for my banking, and it's fabulous. ING is also well-known for being easy to work with. When it comes to online banking, customer service is one of the best indicators for how good a bank is. Online banks that are responsive and helpful to their customers are typically the same ones that offer a variety of services, easy-to-use websites, better automated systems, and so on. So look around at customer reviews of various online banks, and you can probably rely pretty well on those to guide your choice in banks.

An additional advantage of online banking is that you can handle your banking anywhere, such as while traveling. Being tied to a brick-and-mortar bank would almost assuredly be harder to work with if you're across the country on vacation or whatever.

[kork13]

-what if something goes wrong on your account, and you want to make sure someone's looking into it today? brick: go in and talk to personal banker, ask him/her all your questions; online: call/email, not sure how the service is online (most places I ever call put me on hold. would be shocked if online banks aren't the same)

Just to comment on this section, I've worked with 4 different online banks over the years (which in my case are admittedly few), and all of them have actually been quite responsive to phone calls, and especially emails. Almost never waited more than 5 minutes on hold, and emails always responded to within 6-24 hours (both of which, IMO, are pretty darn good), and they're always able to fix any problem immediately. With only maybe 1 or 2 exceptions in 7 years, there's never been any "please wait while I fetch a supervisor/manager to address your issue" situations.

All of this, I think, is possible due to online banks' focus around providing services via integrated computer systems. Any call-center staff have the ability and authority to immediately make any changes or corrections to your accounts at your request. Also, because phone/email are the ONLY ways to contact online banks, they are able to focus their efforts in these areas. It's assembly-line customer service...finish one, move immediately to the next.

[MonkeyMama]

I've always had a brick and mortar CU, but not in the same city/region.

I have since switched to a local CU.

The only problem I ever had was contractors being suspicious of "out of town banks" and unwilling to accept payment. This came up a couple of times. (& I believe they took the checks - but just made a stink about it. We had no other way to pay otherwise, so they accepted in the end). Mind you - this was a small CU - not a big online bank.

These days, we do deposit cash, which is a good point. No way to do that otherwise (in the past I would give cash to relative in exchange for a check to deposit).

I like having the option to get a chasier's check, though I never have!

Beyond the above mentioned items, I have never had a need to go into a branch for anything. Even 20 years ago - everything can be handled on the phone, through the mail, or online.