REVIEW: USAA Checking and Savings Account

I’ll be honest. I don’t like switching bank accounts. I find it a hassle. But every now and then, I discover a reason or reasons so compelling, that the hassle doesn’t bother me. I actually find myself excited about the change. USAA has been just such an experience.

About a year ago, my in-laws told us that we should switch. Being the know-it-all finance guy, I ignored them. Then about a month ago, I randomly decided to check out USAA.com. After about 15 minutes on the site, I was convinced.

A little about USAA

There are a few things that you need to know about USAA

• It’s an online bank. So no physical location to do your banking at.
• It is for military personnel and their families.
• USAA stands for United Services Automobile Association

What convinced me to switch

• Easy to use site
  A lot of bank sites are difficult to use or seem antiquated. USAA.com uses modern web design techniques, social tools, and simplicity to make using the site easy. Now, that’s not to say that you don’t have to sometimes search for an obscure feature, but 98% of the time I easily find what I’m looking for.
• Free checks for life
  They aren’t duplicates, but they are free.
• Host all your accounts with one bank
  USAA is a full-service financial institution. You can have your bank accounts, credit card, auto insurance, home insurance, life insurance, mortgage, auto loan, IRA , brokerage account, 529 college savings plan, etc all at one place. Also, everything is accessible through the one login and user interface.
• Cash back debit card
  If you select “Credit” at check-out, then you earn 1 point for every $2 spent. That is not as much as some credit cards, but this is a debit card. So you don’t have to go into debt and you get rewards like cash back, gift cards, and airline discounts.
• The app, the app, THE APP!
  So I’m a bit of a geek. I love my smartphone. A lot of banks have mobile sites or apps for smartphones. But no one has an app like USAA. I can do just about anything I want, such as transfer funds, pull up my proof of auto insurance if I’m pulled over, and pay bills. If for nothing else, the app makes USAA worth using (if you are a geek like me).
• Deposit@Mobile
  This is probably the coolest part of the app. Hence it getting it’s own bullet point. With most online banks, you have to send checks to some distant land and wait for the deposit. USAA allows you to take a picture of the check and the funds are immediately deposited. The whole process takes about two minutes and the money is available to spend. Very cool.

What I don’t like

• You have to be military or have parents who are member
  Fortunately for us, my in-laws are account holders. Basically, I think it’s a shame that not everyone can take advantage of such a great bank. I have a lot of conversations that end like this, “Yeah, we are so happy to have USAA, but you can’t sign-up since you aren’t military. Sorry for getting you all excited.”
• Your overdraft credit line draws in $100 increments
  The overdraft credit line is really a credit card tied to your checking account. By default, any overdrafts draw from your savings account. If you choose to use the credit card, then they only draw in $100 increments. So if you overdraft by $0.01, then $100 is deposited into your account from the credit card. Annoying.
• Only a few mutual fund options
  I’m pretty picky about my mutual funds and USAA only offers four Index funds. So if you are looking to combine all of your accounts into one bank, then you will want to research the investment options available through USAA.

Conclusion

There are a few drawbacks to USAA, but no one is perfect. I was banking with Charles Schwab, which I have definitely liked. USAA, however, seems to go the extra mile and provide the extra features that make banking almost enjoyable. But may that’s just the finance guy in me.