Choosing a bank account is a big deal. After all, you’re handing the institution what’s most likely the majority of your money for safekeeping. You want to make sure it’s actually safe. You also need to be able to...

Choosing a bank account is a big deal. After all, you’re handing the institution what’s most likely the majority of your money for safekeeping. You want to make sure it’s actually safe.

You also need to be able to access that cash for all your day-to-day operations, like paying bills or coughing up for your share of the pizza.

Along with choosing from multiple financial institutions, banking in 2019 and beyond means making another important decision: Will you use of one of the many all-digital, online-only banking options, or will you keep it old school by opening an account at brick-and-mortar facility?

Are Online Banks Safe?

In a recent survey conducted by The Penny Hoarder, more than 50% of respondents said they wouldn’t consider using an online bank, and more than 19% were unsure about using one. Given how much of our lives are conducted online these days, we found that data point surprising.

But on the other hand, we do understand having reservations when it comes to money matters. Walking into a stately, brick-built bank can make it feel less scary to hand over your hard-earned cash.

So are online banks safe? The truth is there are a growing number of online-only banking alternatives that are, indeed, legitimate and safe. Online banks like Chime and Simple are FDIC-insured for deposits up to $250,000, just like Bank of America and Chase.

And thanks to the magic of technology, you can do pretty much everything you might need to with your money without ever needing to visit a teller in person: depositing checks on your mobile phone, pulling cash from a network ATM or transferring funds to a family member or friend. You can even write paper checks… if you really, really have to.

It’s true, however, that you won’t be able to walk into a bank and talk to a teller in person. What are the other important differences between these two methods of banking?

Brick-and-Mortar Banking: Pros and Cons

Since nearly 72% of our survey respondents said they’d visited a brick-and-mortar bank in the past year, we want to give this option its due. Here are the drawbacks and benefits of patronizing and old-school bank — the kind you can walk into to open your account.

Traditional Banking Pros

Larger banks may offer “one stop shopping” for your financial needs: They often make it easy to take out a mortgage, open a credit card, or apply for a personal loan with the same institution you bank through. (However, these products may come at higher fees than you’d find by shopping around for independent lenders.) Some users simply find it easier to walk into a bank and ask for the service they need. This may be a better option for you if you don’t like figuring out how to get what you need through an online banking portal or app. Depending on the bank you choose, you may be supporting a local (or local-ish) business, or at least a nationwide business that provides jobs in your area. Credit unions in particular are often community-focused institutions that participate in local events and provide friendly, face-to-face customer service to account holders.

Traditional Banking Cons

Again, depending on the bank you choose, you may only be able to access your bank locally. That can present problems for those who travel or eventually plan to move out of state. Large banks often have higher account maintenance fees and other associated costs. After all, they have to keep the lights on at an in-person banking facility. Furthermore, the amount you stand to earn through interest-accruing savings and checking accounts may be lower than what you’d get from a digital-only bank. You’re probably already doing most of your banking online. In fact, more than half of our survey respondents said they do most of their banking online or via mobile app. And at an in-person bank, particularly a small or local one, the online banking portal or mobile app won’t be quite as spiffy as the tech tools you’ll find at a bank where those tools are the primary way to access and interact with your cash.

Online-Only Banking Pros and Cons

So what about digital-only banks? What incentives can they offer to outweigh the drawback of not having a physical location — and what other drawbacks are there?

Online-Only Banking Pros

Because they don’t have as much overhead as banks with physical facilities, online banks frequently offer lower-cost banking options. Many have no monthly maintenance fees or balance requirements. With an online bank, your money goes with you everywhere. You’re not tied to the physical location where your bank has branches. Many online banks allow you to access your cash through a fee-free network of ATMs that stretches not only across the country, but overseas as well, and you’ll always have access to the tools available on your computer and smartphone. Some online banks and alternatives do offer other financial products, like mortgages and student loan refinancing. For example, check out Ally and SoFi, which also offer investment products, educational resources and more. Many online banks offer a suite of digital tools to help you take charge of your finances. These include built-in budget trackers, automatic savings, and integration with popular third-party apps like PayPal or Venmo. While brick-and-mortar banks are also catching on and adding in these extras, all-digital banks tend to have the leg up on these sorts of forward-thinking extras.

Online-Only Banking Cons

No in-person banking option. If you’re set in your ways and don’t want to have to move through the learning curve of figuring out a digital bank’s tools, a brick-and-mortar bank may be easier. (That said, even big chains are installing souped-up ATMs and routing much of the queue to the machine rather than having them interact with tellers… so in the end, you may not really have a choice!)

What to Consider if You’re Looking for a Bank Account

No matter which kind of banking option appeals to you best, keep in mind that not all banks are created equal, whether they inhabit real space or cyberspace. It’s important to thoroughly research all the features and policies of your potential bank account before you sign the paperwork.

Looking for a new home for your cash? Check out our reviews of the best checking accounts and savings accounts on the market today.

Jamie Cattanach’s work has been featured at Fodor’s, Yahoo, SELF, The Huffington Post, The Motley Fool and other outlets. Learn more at www.jamiecattanach.com.

This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.

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