What type of bank should you choose?

Find out which financial institutions work best for your needs.

There are many ways to manage and grow your hard-earned money. You can open an account at a traditional bank, a credit union, or a neobank. You can also invest your money in a money market account or a certificate of deposit. But how do you know which option works best for you and your financial goals? 

1. Credit Unions vs. Traditional Banks

Banks usually offer more banking, retirement, ATM networks, and investment options and tend to have better mobile and online resources. Credit unions have eligibility requirements and sometimes charge membership fees but typically offer lower fees on loans and accounts, as well as slightly higher interest on savings and money market accounts and certificates of deposits. Examine your priorities and lifestyle when deciding between the two.

2. Money Market Accounts

A money market account (MMA) is a higher-interest account that is ideal if you usually carry a higher balance on your checking account. It can be a good emergency fund or a place to put the money you are saving for a larger financial goal (e.g., tuition, house payment). With an MMA, you would have easier access to your money, albeit sometimes banks cap the number of transactions you can do per month. Helpful tip: Check Neobanks and credit unions for low-cost/zero-balance options.

3. Credit Repair Scams

Credit repair scams are reputable credit agencies that may help rebuild your credit through debt management. Pay attention to the following red flags to identify scams: Companies engaging in credit repair fraud will likely insist on getting paid before doing any work, advise you not to contact the credit bureaus, recommend you dispute accurate information, encourage you to give false information on credit applications or offer a "new credit identity". If they promise to ' Fix your credit within 30 days!' or 'Raise your score by 100 points immediately!', it's likely a scam.

Kick start your financial wellness journey with Clair. Sign up for an account today and enjoy your pay, before payday!

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