Most products on this page are from partners who may compensate us. This may influence which products we write about and where and how they appear on the page. However, opinions expressed here are the author's alone, not those of any bank, credit card issuer, airline or hotel chain. This page may include information about American Express products currently unavailable on Slickdeals. American Express is not a partner of Slickdeals.

Most people spend a significant amount of time thinking about their finances. A recent study found that Americans worry about money an average of six times per day.

Depending on your situation, you may put a lot of thought into various aspects of your financial life. For example, you might plan a monthly budget or try to prepare for a potential recession. Perhaps you’re working to pay down debt and save toward future goals. But even if you’re trying to manage your money in a responsible way, it’s possible to still make mistakes.

Banking is an area where financial slip-ups can often go overlooked. Read on to discover four common banking mistakes you might be making in your life. You’ll also find some expert tips on ways to save money (and perhaps earn some extra cash) at a financial institution.

Mistake #1: Only Opening a Checking Account

mobile deposit

iStock

A checking account is a common type of deposit account that many consumers open to manage their finances. In general, you can access the funds you deposit in this type of bank account via debit card, check, and ATM. Your checking account might also offer bill-pay features and could be compatible with services such as Zelle®, Apple Pay, and Samsung Pay.

However, many checking accounts are limited where interest-earning capability is concerned. That means if you leave extra funds in the account that you don’t spend each month, you might earn little to no interest on that money. In this scenario, you could miss out on opportunities to earn money on your savings.

According to the Federal Deposit Insurance Corporation (FDIC), the average annual percentage yield (APY) for interest checking accounts as of January 17, 2023, was a low 0.06%. By comparison, during that same period the FDIC reported the national average APY on savings accounts was 0.33% . And money market accounts – another type of deposit account – had a national average APY of 0.44%.

As you can see, opening a separate savings account or money market account could be an easy way to earn more money on your savings. Plus, by putting your extra cash in a separate deposit account, you might remove some of the temptation to spend those funds on unnecessary purchases.

If you're in the market for new accounts, you may want to consider SoFi Checking and Savings. This account offers competitive rates for both checking and savings balances, as well as a valuable bonus.

SoFi Checking and Savings

Open Account

at SoFi

  • Our Rating 5/5 How our ratings work Read the review
  • APY1.20% - 4.00% More Info

    Customers earn 4.00% APY on savings balances when they set up recurring monthly direct deposit of their paycheck or benefits provider via ACH deposit. Checking balances earn 1.20% APY.

  • Minimum
    Deposit Required    N/A
  • Intro Bonus $50-$250Expires December 31, 2023 More Info

    New customers can earn a $250 bonus for opening a new SoFi Checking and Savings account and receiving a total of $5,000+ in qualifying direct deposits within the specified evaluation period; receive $1,000 - $4,999 in qualifying direct deposits to earn a $50 bonus.

SoFi Checking and Savings boasts an impressive 4.00% APY on savings balances for customers who set up direct deposit (with no minimum deposit requirement). This account also offers 1.20% APY on checking balances. There are no monthly maintenance fees, and new customers can even earn a generous signup bonus worth up to $250. If you don’t care about physical bank locations, this is a great option.

Overview

SoFi Checking and Savings features remarkably strong interest rates for customers who receive recurring monthly direct deposit. This account also doesn’t have any maintenance fees, overdraft fees or non-sufficient funds fees. To top it off, new customers can earn a signup bonus worth up to $250.

Pros

  • Accounts with monthly direct deposit earn interest
  • No minimum opening balance or minimum monthly balance
  • No maintenance fees, non-sufficient fund fees or overdraft fees
  • Access to Allpoint’s worldwide ATM network
  • Get paid up to two days early

Cons

  • No physical branch locations

Mistake #2: Not Paying Attention to Interest Rates

As mentioned, keeping all of your cash in a checking account is typically a mistake. But it’s also important to shop around for the best deals available where interest rates are concerned on savings accounts (and other deposit accounts) and not just assume that your bank offers the best deal. Otherwise, you risk limiting your interest-earning potential in other ways.

It’s typically easy to find both high-yield savings accounts and money market accounts with rates that are much higher than the national average. Depending on your financial goals, you might want to consider whether certificates of deposit (CDs) might be a good fit as well. CDs often feature higher returns in exchange for agreeing not to withdraw the funds you deposit for a set period of time.

Here’s a look at some of the best rates available as of February 2023.

High-Yield Savings Accounts: The best high-yield savings accounts feature interest rates of 3.70% and above — significantly higher than the national average savings rate of 0.33%. 

UFB Direct Preferred Savings Account

Open Account

at UFB

  • Our Rating 5/5 How our ratings work Read the review
  • APY5.02% More Info

    UFB Direct breaks balances into five tiers, but, currently, there is only one interest rate.
  • Minimum
    Deposit Required    N/A
  • Intro Bonus N/A

The UFB Preferred Savings Account has one of the highest interest rates we’ve seen for a high-yield savings account at up to 5.02% APY. Plus, there are no monthly fees and no minimum balance to open.

Overview

With one of the strongest high-yield savings interest rates on the market, as well as no monthly fees or minimum opening deposit, UFB Direct’s Preferred Savings Account is an extremely attractive package.

Pros

  • Strong interest rate
  • No maintenance fees or minimum monthly balances
  • Free complimentary ATM card
  • Mobile app and SMS banking

Cons

  • No signup bonus
  • No associated checking account

Money Market Accounts: It’s possible to find competitive rates on the best money market accounts, some of which exceed 4.00%.

Recommended Account

UFB Direct Preferred Money Market Account

Open Account

at UFB

  • Our Rating 4/5 How our ratings work Read the review
  • APY5.02% More Info

    UFB Direct breaks balances into five tiers, but, currently, there is only one interest rate.
  • Minimum
    Deposit Required    N/A
  • Intro Bonus N/A

The UFB Preferred Money Market account offers up to 5.02% APY on balances, which is competitive with the very best money market accounts. This account also doesn't feature a minimum opening balance requirement, which makes it a viable option regardless of how often you need to move your money around.

Overview

With no minimum opening balance requirement, UFB Direct’s Preferred Money Market Account is an extremely attractive option. It offers high interest rates on all balance tiers, as well as handy features like limited check-writing privileges and debit card access.

Pros

  • Option to waive monthly maintenance fee
  • Competitive interest rate
  • Free debit card
  • Limited check-writing privileges

Cons

  • Monthly maintenance fee applied for low account balances
  • No associated checking account offered

Certificates of Deposit: Top CD rates for 1-year CDs typically exceed 4.30% as of February 2023. The national average for 12-month CDs, by comparison, was 1.28% as of January 17, 2023.

Recommended Account

CIT Bank Term Certificates of Deposit

Open CD

Member FDIC

  • Our Rating 3.5/5 How our ratings work Read the review
  • Minimum
    Deposit Required    $1,000
  • 1 Year APY0.30% More Info

    Annual Percentage Yield is accurate as of January 24, 2023. Interest rates for CIT Bank's term CDs are variable and subject to change at any time without notice
  • 3 Year APY0.40% More Info

    Annual Percentage Yield is accurate as of January 24, 2023. Interest rates for CIT Bank's term CDs are variable and subject to change at any time without notice
  • 13-Month APY4.65% More Info

    Annual Percentage Yield is accurate as of January 24, 2023. Interest rates for CIT Bank's term CDs are variable and subject to change at any time without notice

Many banks that offer CDs require customers to commit to lengthy terms of several years or more in order to earn the highest interest rates available. However, with CIT Bank's term CDs, the opposite is true. To get the best rates at CIT, you'll need to open one of its shorter-term CDs, such as its 13-month CD that pays 4.65% APY. If you want an easy way to save more money without having to wait years, CIT Bank's term CDs are a solid option.

Overview

If you’re looking for a dependable way to earn interest on your money in the short term, CIT Bank’s certificates of deposits may be an excellent choice for you. However, those looking to open a long-term CD may be better off looking elsewhere.

Pros

  • Strong rates for 13- and 18-month terms
  • FDIC insured

Cons

  • Rates for longer terms unimpressive

A Slickdeals Money How to Guide

CD vs. High-Yield Savings Account: Which Is Better for You?

For short-term savings goals, certificates of deposit (CD) and high-yield savings accounts can both be good places to store your cash. Both types of deposit accounts have the potential to help you earn above-average interest rates...

Read the guide

Mistake #3: Keeping Your Cash At One Bank

bank deposit

iStock

Not shopping around for the best rates available is a mistake. But you also risk missing out on higher interest-earning opportunities by limiting yourself to a single financial institution. Sometimes, you can find the highest APYs by saving your cash in accounts with multiple banks and credit unions.

In addition to the potential for higher interest rates, there are other possible benefits of keeping funds with several financial institutions, including the following.

Limit Temptation

Some consumers prefer to save money at different banks and credit unions to limit their temptation to overspend. For example, if you keep your emergency fund at a different bank than your checking account, it might be easier to avoid tapping into your savings since those funds will be out of sight, out of mind.

Earn Bank Bonuses

If you open multiple bank accounts, you might have more opportunities to take advantage of valuable promotional offers and earn bank bonuses.

person juggling on beach Related Article

How to Manage Multiple Bank Accounts and Credit Cards Like an Expert

Read More

Featured Bank Bonus

Chase Total Checking® Account

Open Account

at Chase

  • Our Rating 4/5 How our ratings work Read the review
  • APYN/A
  • Minimum
    Deposit Required    N/A
  • Intro Bonus $200Expires April 19, 2023 More Info

    New Chase Total Checking customers can earn a $200 bonus when they open an account and set up direct deposit.

Chase Total Checking® is among the best entry-level accounts. It typically offers a $200 bonus, and historically all you have to do to earn it is set up direct deposit. On top of that, it’s fairly simple to waive the $12 monthly fee. However, it's worth noting that it doesn’t offer many valuable features or benefits and it’s not an interest-bearing checking account.

Overview

Chase Total Checking® is a basic checking account that doesn’t offer many premium features. However, if you can easily meet the qualifications required for the new account bonus (and to waive its monthly fee), it’s a good option for those who want an entry-level account.

Pros

  • No minimum opening balance
  • Multiple ways to waive monthly fee
  • Bonus is relatively easy to earn
  • Access to nationwide Chase branches and ATM network

Cons

  • Monthly maintenance fee
  • Account does not earn interest

Mistake #4

Many banks are notorious for charging their customers high fees. But that doesn’t mean you have to accept that fees will be a frequent part of your monthly banking experience. Although bank fees are common, there are also ways to avoid them.

If you want to limit the bank fees you pay, here are some options to consider.

  • Compare free checking accounts and the features that they offer. 
  • Search for banks that offer ATM reimbursement and free ATM access. 
  • Opt out of paper statements. 
  • Avoid banks that charge so-called junk fees for inactivity, lost debit cards, surprise overdraft fees on debit transactions, and more. 
  • Don’t use your debit card outside of the United States if it features a foreign transaction fee. (Better yet, consider using a no-foreign-transaction-fee credit card for added protection.)

Bottom Line

Small financial mistakes can add up over time. Paying extra money on a few fees here and there can also take more money away from your savings. Meanwhile, missing out on higher interest-earning opportunities could limit your money’s growth potential. It may take some extra time to avoid the banking blunders above, but your future self will thank you for the effort.

ML

Michelle Lambright Black

Michelle Black is founder of CreditWriter.com and HerCreditMatters.com. Michelle is a leading credit card journalist with over a decade and a half of experience in the financial industry. She’s an expert on credit reporting, credit scoring, identity theft, budgeting, small business, and debt eradication. Michelle is also a certified credit expert witness and personal finance writer.