Schwab/Fidelity vs BoA Gold: Checking

Old Nov 11, 17, 6:22 pm
  #1  
Original Poster
 
Join Date: Jun 2014
Posts: 213
Schwab/Fidelity vs BoA Gold: Checking

I've split this post into three independent parts, please feel free to respond to any or all.
Would appreciate feedback from the knowledgeable folks here.

1.
I'm taking a slightly critical look at the Big bank checking accounts (BoA, Chase, etc) that offer "perks" for higher balances, to determine if they have any merit.

Looking at Bank of America's Preferred Rewards - Gold tier, which starts with a $20,000 balance, here are the perks:


https://info.bankofamerica.com/preferred-rewards

If you click on "No Fees", details:



Questions:

- Are these real/substantial benefits (worth the $20K) or just gimmicks?
- Do other banks/CUs offers these for free?


2.
I recently came across the Checking account of Charles Schwab and the Cash Management Account of Fidelity.

I'm impressed by the features:
- No minimum balance, no monthly fee.
- No ATM fee, worldwide,
- Reimburse other institution's surcharge.
- No foreign transaction fee on ATM cash withdrawal.

So are there good reasons to bank with the likes of BoA, Chase, Citi which have none of these features?
I'm trying to see if there are downsides to Schwab/Fidelity accounts, or under what situations would one prefer BoA/Chase for checking?

For comparison, BoA has $2.50 non-BOA ATM fee. To waive it you'd need minimum balance of $100,000 - and that would still NOT apply overseas. Outside the US you'd pay $5 + 3% !!


3.
Capital One 360 Checking.

It has similar benefits as Schwab/Fidelity, except it doesn't reimburse other institution's ATM surcharge.
Does Capital One have any benefit (within US) over Schwab/Fidelity that would offset this?

I know it has one benefit outside the US. Capital One is Mastercard, which has 0.2 - 0.5% better exchange rate than Visa. So that might offset the non-reimbursement of foreign ATM surcharge? And might make Capital One and Schwab/Fidelity come out even overseas.

Thoughts?

Thank you for your interest and responses.
kayanco is offline  
Old Nov 11, 17, 7:27 pm
  #2  
 
Join Date: Mar 2013
Posts: 457
Fidelity outsources it’s checking product to UMB. Schwab is an actual bank so you deal directly with them. I use Schwab as my primary checking and I have never had an issue and their customer service is spectacular. I also have a Fidelity CM account but I don’t really use it other than to redeem Cashback from my Fidelity Visa.

BoA lets your Merrill Edge balance count towards your tier. If you don’t mind having your money at Merrill Edge, which is an excellent low fee platform btw, then I’m sure it will work just as well for you plus you get the 75% bonus on their credit card rewards.
jags86 is online now  
Old Nov 14, 17, 1:42 pm
  #3  
 
Join Date: Jul 2001
Location: DTW
Programs: Dirt Status w/ All
Posts: 4,994
I'll be closing my BoA checking/savings accounts of 30 years tomorrow as my Cap One 360 account is now set up and funded. I really have no use for a B&M bank any more.

I have not been unhappy with BoA, but there are better options today. My BoA HELOC balance dropped below $10K which triggered a $25 maintenance fee on the account. I could drop to the 0.01% interest checking instead of the 0.03% account I have today and my paycheck direct deposit would waive the $12 fee, but why bother when Cap One will pay 0.2% for checking and 1.3% for savings over $10K? BoA's ATM fees are also crazy at $5 + 3% for international transactions if you don't use a partner bank, which many countries don't have. I have better rewards options with Chase, Citi and Amex so the points booster doesn't do much for me.

I have had the Fidelity Cash Management account for years and will be keeping it. I've used less than $300 in cash in the US this year since 99% of my spending is on rewards credit cards. I keep <$500 in the Fidelity account for foreign currency, dive bar and vending machine cash. The BoA debit, and now Cap One debit, stay safely locked up at home to minimize the chances of fraud on my primary bank accounts. I push a couple hundred to Fidelity if the account runs low.
tev9999 is offline  
Old Nov 14, 17, 1:52 pm
  #4  
Original Poster
 
Join Date: Jun 2014
Posts: 213
Originally Posted by tev9999 View Post
I'll be closing my BoA checking/savings accounts of 30 years tomorrow as my Cap One 360 account is now set up and funded. I really have no use for a B&M bank any more.

I have not been unhappy with BoA, but there are better options today. My BoA HELOC balance dropped below $10K which triggered a $25 maintenance fee on the account. I could drop to the 0.01% interest checking instead of the 0.03% account I have today and my paycheck direct deposit would waive the $12 fee, but why bother when Cap One will pay 0.2% for checking and 1.3% for savings over $10K? BoA's ATM fees are also crazy at $5 + 3% for international transactions if you don't use a partner bank, which many countries don't have. I have better rewards options with Chase, Citi and Amex so the points booster doesn't do much for me.

I have had the Fidelity Cash Management account for years and will be keeping it. I've used less than $300 in cash in the US this year since 99% of my spending is on rewards credit cards. I keep <$500 in the Fidelity account for foreign currency, dive bar and vending machine cash. The BoA debit, and now Cap One debit, stay safely locked up at home to minimize the chances of fraud on my primary bank accounts. I push a couple hundred to Fidelity if the account runs low.
Thanks for sharing your BOA experience.


Can you say why you got a Capital One 360 account if you already have Fidelity? I thought if you have either Fidelity or Schwab, then Capital One 360 would be redundant. Are there other aspects to it?

I know Cap 360 would be "slightly" better overseas due to being Mastercard, but I'm assuming Fidelity/Schwab would still come out ahead since they reimburse ATM fee.

You thoughts ?
kayanco is offline  
Old Nov 14, 17, 5:11 pm
  #5  
 
Join Date: Dec 2009
Location: New York, NY
Programs: AA Gold. UA Silver, Marriott Gold, Hilton Diamond, Hyatt (Lifetime Diamond downgraded to Explorist)
Posts: 6,564
Schwab has too become my primary bank for checking, savings, IRA & some investments which the percentage is growing each year as I move more and more away from my WF Advisors account.

I also have a Cap1 360 account for two reasons. Firstly, just to have a no cost backup option where I can store some money for emergencies. The later is to hedge against the only true downside to the Schwab Bank, the lack of a physical location. In an emergency such as a lost debit card/wallet I can't go to a Schwab bank unless I'm near the two actual physical banks in Nevada I believe. So far this has only happened to me once in 5+ years and Schwab overnighted me a new card at no extra cost. Another situation is when depositing large checks over the app deposit limit. You can mail it into Schwab but that carries the risk of postal service errors & the delayed time in getting to Schwab plus they may put a hold on some of the funds. But I can deposit into Cap1 on Monday have the funds available by Wednesday at the latest & deposited into my Schwab account Thursday or Friday with essentially no chance of a hiccup.

I find it to me a good balanced alternative setup to the big banks.

Additionally I can't stress how great Schwab's customer service is. It's US based which I do like and the agents are very friendly, caring & competent. 4ish years ago my debit card got cloned in Mexico and a few weeks later someone tried to take out several thousands of USD from an ATM there but of course Schwab denied that, called me, ordered me a new card which would be delivered on Tuesday (this was Sunday) and asked if I needed cash to hold me over, which I did. They authorized in the system for me to use my current card to takeout money at an ATM at the bar I was in and then terminated the card. Won't get that from Wells Fargo.
kayanco likes this.
Yoshi212 is online now  
Old Nov 14, 17, 5:56 pm
  #6  
Original Poster
 
Join Date: Jun 2014
Posts: 213
Originally Posted by Yoshi212 View Post
Schwab has too become my primary bank for checking, savings, IRA & some investments which the percentage is growing each year as I move more and more away from my WF Advisors account.

I also have a Cap1 360 account for two reasons. Firstly, just to have a no cost backup option where I can store some money for emergencies. The later is to hedge against the only true downside to the Schwab Bank, the lack of a physical location. In an emergency such as a lost debit card/wallet I can't go to a Schwab bank unless I'm near the two actual physical banks in Nevada I believe. So far this has only happened to me once in 5+ years and Schwab overnighted me a new card at no extra cost. Another situation is when depositing large checks over the app deposit limit. You can mail it into Schwab but that carries the risk of postal service errors & the delayed time in getting to Schwab plus they may put a hold on some of the funds. But I can deposit into Cap1 on Monday have the funds available by Wednesday at the latest & deposited into my Schwab account Thursday or Friday with essentially no chance of a hiccup.

I find it to me a good balanced alternative setup to the big banks.

Additionally I can't stress how great Schwab's customer service is. It's US based which I do like and the agents are very friendly, caring & competent. 4ish years ago my debit card got cloned in Mexico and a few weeks later someone tried to take out several thousands of USD from an ATM there but of course Schwab denied that, called me, ordered me a new card which would be delivered on Tuesday (this was Sunday) and asked if I needed cash to hold me over, which I did. They authorized in the system for me to use my current card to takeout money at an ATM at the bar I was in and then terminated the card. Won't get that from Wells Fargo.
Thanks for sharing your experience with the banks. Very helpful post indeed.
kayanco is offline  
Old Nov 14, 17, 9:39 pm
  #7  
 
Join Date: Oct 2009
Location: BOS, LAX
Programs: AA GLD, B6 Mosaic, HH Diamond
Posts: 730
BofA Gold is not competitive. However, if you have at least $50k to invest then you can get Platinum from BofA if you invest with Merrill Edge. The Platinum level with 30 free trades per month on Merrill Edge already beats the Schwab brokerage account. If you have $100k to invest, you'll get Platinum Honors and highly competitive cash back rates on BofA credit cards in certain categories.

I have both BofA/Platinum Honors and Schwab. I use only Schwab for ATM withdrawals.
grrizzli is offline  
Old Nov 14, 17, 9:52 pm
  #8  
Original Poster
 
Join Date: Jun 2014
Posts: 213
Originally Posted by grrizzli View Post
BofA Gold is not competitive. However, if you have at least $50k to invest then you can get Platinum from BofA if you invest with Merrill Edge. The Platinum level with 30 free trades per month on Merrill Edge already beats the Schwab brokerage account. If you have $100k to invest, you'll get Platinum Honors and highly competitive cash back rates on BofA credit cards in certain categories.

I have both BofA/Platinum Honors and Schwab. I use only Schwab for ATM withdrawals.
I've heard that for investing Vanguard and Fidelity are better than Merrill Edge.
kayanco is offline  
Old Nov 14, 17, 10:29 pm
  #9  
 
Join Date: Oct 2009
Location: BOS, LAX
Programs: AA GLD, B6 Mosaic, HH Diamond
Posts: 730
Originally Posted by kayanco View Post
I've heard that for investing Vanguard and Fidelity are better than Merrill Edge.
You can buy any ETF* or individual stock on Merrill Edge, for free if you qualify. Fidelity has a limited list of free-trade ETFs that actually changes, so if you want to close or expand a position a year or two later, it may not be free.

*Vanguard ETFs are very much available to trade on Merrill Edge. There is such a thing as Admiral Shares with Vanguard that can only be purchased in the Vanguard account -- if you qualify. They my have lower expense ratios but you need to compare the expense ratios for any fund you consider -- I'm not convinced that even Admiral Shares Vanguard funds beat Schwab funds (and Schwab funds are available everywhere, including Merrill Edge). Whether you want to restrict yourself exclusively to the Vanguard universe or you value being able to trade something (anything) else, that's up to you.

Last edited by grrizzli; Nov 14, 17 at 10:35 pm
grrizzli is offline  
Old Nov 15, 17, 8:50 am
  #10  
 
Join Date: Jul 2001
Location: DTW
Programs: Dirt Status w/ All
Posts: 4,994
Originally Posted by kayanco View Post
Thanks for sharing your BOA experience.


Can you say why you got a Capital One 360 account if you already have Fidelity? I thought if you have either Fidelity or Schwab, then Capital One 360 would be redundant. Are there other aspects to it?

I know Cap 360 would be "slightly" better overseas due to being Mastercard, but I'm assuming Fidelity/Schwab would still come out ahead since they reimburse ATM fee.

You thoughts ?
First, Cap One has better interest rates. Up until now I have not cared as I was focusing on paying off debt and maxing out my 401K for savings. I was intentionally cash poor and used the HELOC and other credit as my emergency fund, thankfully not needing to be tapped. Now that my debt is about gone and the HELOC draw is expiring and has to be closed anyway, I expect to start building more cash and want to keep some liquid. Cap One is .75% under $10K and 1.3% over $10K. I think the checking account is .2% While not stellar, much better than Fidelity's 0.04%.

Second, I don't like to carry the debit card attached to my bill pay account. If my wallet is lost/stolen or ATM card skimmed and a thief goes on a shopping spree, all of my payments bounce. While I would expect to be made whole eventually it would be a major PITA to straighten out a bunch of missed payments. The Fidelity account keeps a small amount isolated from my main accounts. If that card is compromised I won't be out more than a few hundred until it is replaced and have the Cap One debit as a backup in the meantime. Basically just keeping my eggs in multiple baskets.
kayanco likes this.
tev9999 is offline  
Old Nov 15, 17, 6:44 pm
  #11  
Original Poster
 
Join Date: Jun 2014
Posts: 213
How do you deposit cash to Fidelity, Schwab or Capital One if there's no branch near you?

I got some cash back at the grocery store today, but soon realized that I didn't need it. As I exited, right next to the grocery was a national bank's branch. And I thought: If I had an account here, I could easily deposit the cash in my account; so his "might" be a limitation of Schwab, Fido and Cap One.

Is there a free way to do so?

Google tells me that some ATMs accept cash deposits? Has anyone tried this? Is it free?
Also, sounds like you could reload a prepaid debit card (with the cash) at some store and then transfer the money to your online-only bank? Is this free?

Thanks.
kayanco is offline  
Old Nov 15, 17, 7:20 pm
  #12  
FlyerTalk Evangelist
 
Join Date: Aug 2009
Location: ZOA, SFO, HKG
Programs: UA 1K 0.9MM, Marriott Gold, HHonors Gold, Hertz PC, SBux Gold, TSA Pre✓
Posts: 10,384
Originally Posted by kayanco View Post
- Are these real/substantial benefits (worth the $20K) or just gimmicks?
Gimmicks mostly.

FWIW - these are all real benefits. The question is how often you will be able to use it. For example - Free (selected styles) check printing is usually a benefit of high tiered checking account. But are you seriously going to order a box of checks each month?

Beside - the cost of a box of checks is usually under $25 through the banks.

Originally Posted by kayanco View Post
- Do other banks/CUs offers these for free?
Yes and no. FWIW - paying fees are not always a bad thing.

Originally Posted by kayanco View Post
So are there good reasons to bank with the likes of BoA, Chase, Citi which have none of these features?
Yes, if you are a very simple person.

Originally Posted by kayanco View Post
I'm trying to see if there are downsides to Schwab/Fidelity accounts, or under what situations would one prefer BoA/Chase for checking?
Relationship. Schwab/Fidelity style won't help you establishing any kind of relationships with the institutions. But those big banks can.

Originally Posted by kayanco View Post
Does Capital One have any benefit (within US) over Schwab/Fidelity that would offset this?
No. C1 360 is more like the last man standing during the era of internet banks.

Originally Posted by kayanco View Post
So that might offset the non-reimbursement of foreign ATM surcharge?
Unless you use the account exclusively overseas, this is a too small issue to discuss.

Beside - there are ways to circumvent the issue.
garykung is offline  
Old Nov 15, 17, 9:52 pm
  #13  
 
Join Date: Dec 2009
Location: New York, NY
Programs: AA Gold. UA Silver, Marriott Gold, Hilton Diamond, Hyatt (Lifetime Diamond downgraded to Explorist)
Posts: 6,564
Most, if not all, non-Bank ATMs do not accept cash or checks for your account.

That is the last reason I also keep my Cap1 360 account as I can use my debit card and deposit cash and/or checks at the ATM as if it was a regular Capital One Bank Checking/Savings account.

Originally Posted by kayanco View Post
How do you deposit cash to Fidelity, Schwab or Capital One if there's no branch near you?

I got some cash back at the grocery store today, but soon realized that I didn't need it. As I exited, right next to the grocery was a national bank's branch. And I thought: If I had an account here, I could easily deposit the cash in my account; so his "might" be a limitation of Schwab, Fido and Cap One.

Is there a free way to do so?

Google tells me that some ATMs accept cash deposits? Has anyone tried this? Is it free?
Also, sounds like you could reload a prepaid debit card (with the cash) at some store and then transfer the money to your online-only bank? Is this free?

Thanks.
Yoshi212 is online now  
Old Nov 15, 17, 10:15 pm
  #14  
Original Poster
 
Join Date: Jun 2014
Posts: 213
Originally Posted by garykung View Post

Relationship. Schwab/Fidelity style won't help you establishing any kind of relationships with the institutions. But those big banks can.
Unless you use the account exclusively overseas, this is a too small issue to discuss.
Beside - there are ways to circumvent the issue.
Hi,

Thanks for your detailed reply. Can you clarify the details on some of your points please?

What do you mean by relationship? What do you get out of it (I know the bank get your money and business, that part is clear )

For sake of discussion, let's assume you are using exclusively overseas (maybe your US employer sends you there). It's still not clear whether Schwab (Visa + reimbursement) or Capital One (Mastercard, but no reimbursement) would come out ahead (even if slightly)?
(I would guess that Schwab might still be better because I compared the exchange rate, and the difference for $1000 withdrawal was $ 0.5 - 1.5)

Circumvent? How?

Thank you.
kayanco is offline  
Old Nov 15, 17, 11:07 pm
  #15  
 
Join Date: May 2010
Location: Rockin' the Bakken
Programs: Several
Posts: 734
I've had the Schwab checking account for over 5 years now and have been very happy. Apart from what's already been said, the biggest thing I've run into that I would say is out the ordinary (ATM reimbursements, free checks, etc) is the daily mobile deposit allowance. I use Schwab as my primary cash account, and I've had to deposit some relatively large checks. My Schwab account allows $10k/day in mobile deposits whereas my Chase account only allows $3.5k. That's a pretty big deal to me considering there are not many brick and mortar Schwabs around. I also live in a part of the country that has few large chain banks with the closest being US Bank albeit it's a 45 minute drive. As long as you're not consistently receiving large amounts of cash, I'd say the Schwab/Fidelity is a far better option.

Granted, I still maintain a Chase and US Bank checking account for when I do need a brick and mortar branch. I think the thing that finally pushed me over the edge was Chase wanted to charge me $20 for a box of 100 checks because I didn't have a higher tier account with them. I also have two auto loans with Chase, and from the few I have had, the Chase interface for vehicle loans is great with it being shown when you log on to your checking/credit card accounts.
UVU Wolverine is offline  

Thread Tools
Search this Thread