Banking With Bank of America: Pros and Cons
Bank of America, sometimes referred to as BofA, was the first bicoastal bank in the United States when it launched in 1998. It remains one of the world’s largest banks with 4,300 branches and approximately 16,000 ATMs in the United States.
Bank of America has a wide range of services for individuals, small businesses, corporations, institutions, and investors. BofA offers retirement and wealth management services, as well. You can access these services online or via one of the many brick-and-mortar branches around the country. You can make withdrawals via these banks or the ATM network, and handle other banking transactions at any branch or, in many cases, through the bank’s website and mobile app.
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Bank of America Services
Bank of America offers a full range of banking services for businesses, consumers, and investors. Depending on the type of account or service that you choose and your financial needs, you need to be aware of fees, requirements, and limitations associated with banking at BofA.
Bank of America has a wide range of personal bank accounts and products, each of which offers a specific set of benefits and features. These include:
- Checking Accounts;
- Rewards Savings Accounts;
- Child Savings Accounts;
- Rewards Credit Cards;
- Secured Credit Cards;
- 529 College Savings Plans.
Most customers use Bank of America’s checking and savings accounts. Checking options include the high-end Advantage Relationship Banking account, the Advantage Banking Plus account, and the entry-level or “second chance” Advantage SafeBalance account.
Advantage Relationship Banking requires a $100 initial deposit, and it comes with a $25 monthly fee. You can waive this fee if you have at least $10,000 in eligible Bank of America accounts. You can also avoid fees by becoming a member of the Preferred Rewards Program.
Advantage Banking Plus accounts have a $100 minimum deposit requirement and a $12 monthly fee, which you can avoid by maintaining a daily balance of at least $1,500 or setting up a direct deposit that totals $250 or more per month.
Advantage SafeBalance is an entry-level account and second-chance bank account that only has a $25 minimum opening amount. This account has a $4.95 monthly fee, and you cannot waive it.
All these accounts are manageable via any BofA branch or a mobile app. You also have access to a network of more than 16,000 ATMs, which offer fee-free withdrawals.
Bank of America also has a personal savings account called Rewards Savings. This account has an $8 monthly fee, but you can easily avoid it by keeping a balance of at least $500 in your account. BofA’s interest rates are not very competitive. The annual percentage yield (APY) is 0.05%, which is very low compared to savings accounts at many other competing banks or credit unions.
BofA does have a fee-free savings account for children. This joint account has no monthly fees as long as one of the joint holders is under 18 years old.
BofA’s small business products include the Business Fundamentals checking account and the Business Advantage Checking Account. The Business Fundamentals account has a $14 per month fee, which you can avoid by spending $250 per month with your debit card or maintaining a monthly balance over $5,000 or a daily balance over $3,000.
The Business Advantage account is for larger businesses. You can avoid its $29.95 monthly fee by making $2,500 in debit purchases or having an average monthly balance of over $15,000.
Bank of America also offers point-of-sale solutions for small businesses. You can apply for a line of credit of between $10,000 and $100,000. If you have a $20,000 average balance in eligible BofA accounts, you may apply for the Preferred Rewards program, which offers lower interest rates, allows you waive fees on accounts, and provides other perks.
Bank of America offers most of its wealth management services through its partner, Merrill. Merrill, formerly Merrill Lynch, provides a variety of products, including IRAs and brokerage services for self-directed investing. You can link Bank of America and Merrill accounts.
Bank of America itself offers more basic investment options such as CDs. They also have the Bank of America Private Bank, which is for account holders with substantial wealth.
Businesses and Institutions
Bank of America offers a variety of services for large businesses and institutions. These include:
- Fraud detection;
- Worldwide transaction services;
- Market research services;
- Large-scale trading services;
- Capital management services.
Bank of America works with companies and individuals to tailor these services to fit their needs.
Pros of Bank of America
Bank of America offers a number of advantages to account holders. People who would benefit from these positive attributes might consider choosing this bank.
- Bank of America has a quality mobile app that users can rely on to manage all their accounts and receive alerts.
- Because it is a large bank, BoA has branches all over the country. Face-to-face service is available regardless of your location.
- BofA has a huge network of ATMs. You can make fee-free withdrawals at around 16,000 locations around the country.
- You can link your checking and savings with investing and retirement accounts.
- Bank of America offers all the banking products that you could need in one place.
- Though the bank charges fees for many of its accounts, it offers multiple ways to avoid fees.
Cons of Bank of America
- The interest rates on savings accounts and CDs are quite low compared to many other banks.
- Most accounts require that you pay fees unless you take very specific steps to avoid them.
- You can get hit with multiple overdraft fees at one time if you do not make a deposit to bring your account back above $0.
- You cannot avoid fees on some accounts, such as the Advantage SafeBalance account, which is geared towards low-income users.
Is Bank of America Safe?
Bank of America has many safety features. The bank has a dedicated fraud department that monitors accounts for fraudulent activity. An example of a specific security feature is a monitoring practice that uses your phone’s GPS to match your location to the location where you use your credit card.
The SafeBalance checking account comes with a debit card that has your photo on it. This account also does not allow any overdrafts, which can protect you from overdraft fees and also keeps someone from using your card to withdraw an excessive amount of money.
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