Bank of America is the second largest bank in the country, operating in all 50 states, and it is one of the largest banks in the world. If you’re thinking of opening an account with Bank of America, it’s a good idea to consider the pros and cons of banking with this financial giant. Bank of America is everywhere, offers many free, convenient account services and provides a one-stop-shopping experience.

 

Bank of America Pros (Advantages)

  • Accessibility. Bank of America is omnipresent. If you open an account, you can be pretty sure that there will be a branch close by, since Bank of America is in every state in the union. Its ATMs are legion, reducing the likelihood that you’ll have to pay foreign ATM fees.

     

  • Ease of use. Bank of America offers branch banking, free online banking, mobile and text banking. On the other hand, today almost any bank offers all these services, excluding online banks, which do not offer branch banking.

     

  • Automatic savings. “Keep the Change” is a convenient savings program that rounds your every debit card purchase up to the nearest dollar and deposits the rounded amount into your linked Bank of America savings account. However, it is important to be aware that BofA charges monthly fees for savings and checking accounts. They can range anywhere from $5 to $25. Fees can be avoided with some conditions; otherwise, monthly charges will dramatically decrease savings. Take a look at the comparison of major U.S. bank savings accounts below. Not only BofA (read BOA Savings review) is well behind CIT Bank in interest rates but also has fees that some other banks do not charge.

    Loan Term CIT Bank Savings Account Bank Of America Savings Account Citibank Savings
    APY 1.55% 0.01%-0.06% 0.01%
    Monthly Fee $0 $5 or $12 $4.50
    Minimum Balance Required to Waive Monthly Fee $0 $300 $500
    Minimum Opening Deposit $100 $25 $100
    Annual Interest Earned on $5,000 Balance $775.00 $0.50 $0.50
    Open an Account CIT Savings Account Bank Of America Savings Account Citibank Savings Account

  • Safety and security. Bank of America provides many free security features for its customers, such as “Site Key,” a security measure for your online banking account. When you log into your online banking account, you’re presented with an image and caption that you chose beforehand. Any site without them is not the real BOA site. BofA’s “SafePass” is a 6-digit, one-time passcode you can use when authorizing transfers. It’s sent as a text message to your mobile phone, or generated from a card. “ShopSafe” feature allows you to create a temporary credit card number every time you make an online purchase. This number links directly to your real credit card account number, but never reveals it.

     

  • A variety of checking accounts. Bank of America offers two personal checking accounts: Bank of America Core Checking and Bank of America Interest Checking. Both accounts offer free online banking, mobile and text banking, and free bill pay. Debit cards are available for both accounts, and they come with the Total Security Protection® package, which includes $0 Liability Guarantee (fraudulent charges are credited back to your account as soon as the next business day) and fraud monitoring. In addition, customers may choose to add their photo on an eligible card to help protect them if the card is lost or stolen.

     

  • Investment options. Bank of America acquired Merrill Edge in 2009 and many selected branches across the country now include a Merrill Edge representative for the convenience of customers. Self-directed brokerage accounts are available online. The brokerage offers decent pricing and competitive services. Merrill Edge is a good choice for buy-and-hold investors and current Bank of American customers, however there are better options on the market.

These are some of Bank of America’s advantages. Let's take a look at some of its drawbacks.


Bank of America Cons (Disadvantages)

  • Account fees. Bank of America created an uproar a few years back when it proposed a $5 monthly fee on its debit card users if they didn’t have a mortgage with them, or a a Merrill Lynch brokerage account or $20,000 in total balances. The public backlash was so severe that the firm had to drop the idea. Nevertheless, all Bank of America checking accounts – Bank of America Core Checking and Bank of America Interest Checking -- require account holders to do something to avoid monthly fees. The basic Core Checking account offers two possibilities of avoiding fees – holders must have at least one qualifying direct deposit of $250+ or maintain an average daily balance of $1,500+. BofA also waives the fee for students under age 23 who are enrolled in high school, college, university or a vocational program.

     

    $25 monthly fee is waived for Bank of America Interest Checking account if a combined monthly balance of at least $10,000 is maintained in linked Merrill Edge and Merrill Lynch investment accounts, or linked BofA CDs, IRAs, checking, savings and money market savings accounts. See BOA Checking review.

     

  • Slow service. Bank of America’s size can sometimes be a drawback. Many customers complain that if they have to go inside the branch to talk to a banker or a broker, they have to wait for a long time. Others complain about long teller lines, especially during high-traffic hours.

     

  • Low interest rates. Large banks are not eager to pay their customers the most competitive interest rates on their savings, checking, IRA and CD accounts. As a table above shows, much better rates can be found at some smaller banks. See Highest APY savings accounts.

     

  • Lack of responsiveness. Bank of America mortgage customers, especially those with problems, have complained that it’s very difficult to resolve mortgage issues through the bank, and especially hard to get a timely response.

Bank of America Review Summary

Bank of America has both the advantages and drawbacks inherent to its role as one of the world’s largest banks. If plenty of locations, one-stop convenience and online security are high on your list of priorities, Bank of America may be a good choice for you. If, on the other hand, you want free, no-fee checking or savings, and better interest rates you may want to look elsewhere.


Continue Reading


Bank of America reviewed by TopRatedFirms.com Rating: 3