Compare Transaction Accounts

How to compare transaction accounts

A transaction account is an account that is used for everyday banking. Using this kind of account, you can arrange for your salary to be paid into it, bills to come out of it, and with a debit card or ATM card, you can withdraw money and make purchases.

Although most transaction accounts can look fairly similar, there are some differences to look out for. One of the most important things to think about is how much you will pay in fees. Many transaction accounts will charge a monthly service fee, and while it may not seem that much per month, it can really add up over time. Depositing a certain amount per month can waive the monthly service fee, or you could choose to bundle your banking products to save money as well.

Other fees to look out for are over-the-limit fees. If you have direct debits coming out of your account, or you have a linked debit card, it can be easy to go over your limit and spend more than there is in the account. Some providers can charge $10-$20 each time you go over the limit, so it's best to find out about this first and try not to go over.

You may also be charged ATM fees when you withdraw money at another banks' ATMs. Find out what ATMs you can use for free, and make sure there are plenty in your area. You may also want to check if there are unlimited transactions, or if you have to pay for withdrawals after a certain number of transactions. You may also be charged for over-the-counter transactions.

Accessibility is another important aspect. Because a transaction account will usually be the account you use most often, it's important to choose one that gives you easy access to your money and to your account information. Check whether there are phone banking and online banking options, and if you can set up direct debits to pay bills. You may also want the convenience of a Visa or MasterCard Debit, so you can use your debit card in the same way as a credit card but only using your own money.

Here is a quick checklist of what to compare when choosing a transaction account.

Account Fees:

Look at monthly service fees, and if there is any way to have them waived, such as paying your salary into the account, or bundling other banking products.

Other Fees:

Find out how much ATM fees will be, and check whether there are enough ATMs in your area. Other fees to watch out for are over-the-limit fees, foreign transaction fees, over-the-counter fees, and direct debit fees.

Account Access:

Be sure to choose an account that gives you sufficient access to your money. This includes depositing and withdrawing money, online and phone banking, and ATM or debit cards.

Visa or MasterCard Debit:

Having a debit card can really be useful, especially if you don't have or don't want a credit card. You will have the convenience of a credit card, but you will only be using your own money. This means no interest repayments, and no worrying about paying monthly bills.