Is There Any Reason to Stick With a Brick-and-Mortar Bank in 2024?

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Online banks often charge lower fees than brick-and-mortar banks and may pay higher interest rates. Learn why you might not want to give up local banking. 

Online banks are often a better choice for your bank accounts. Because they don’t have physical locations, they can keep costs down and often provide better interest rates and charge fewer fees than banks with physical branches do.

But while many people will find online banks work for them, this doesn’t mean everyone should switch. In fact, there are a few really good reasons sticking with a brick-and-mortar bank could be better for your personal finances in some circumstances.

1. You deposit cash a lot

Unfortunately, many online banks are simply not equipped to accept cash deposits. This makes sense, since they don’t have tellers you can hand the money to or their own ATMs that you can use to deposit the cash in an envelope.

While online banks do allow mobile deposits of checks, you’ll have to jump through a lot of hoops to get your cash into the account. This could include depositing the money into a different account and transferring it in via electronic funds transfer (not everyone can do this if they don’t have access to a different account).

So, if you regularly have cash you need to deposit into your checking or savings account, you may be better off with a brick-and-mortar bank so you don’t have to deal with a ton of hassle each time you want to deposit it.

2. You need in-person support

Not everyone is comfortable using online customer support, or even calling customer service on the phone. If you want to be able to go and talk with a banker to get help with your account, you’re going to need a brick-and-mortar bank.

Having a local branch to visit can be convenient when unexpected issues arise as well. For example, I recently needed to wire money quickly when my home sale was suddenly able to close after months of waiting. The amount I needed to wire was above my daily limit for digital wire transfers, so I had to make a same-day appointment with a banker to be able to get the money sent over and avoid delaying my closing.

This situation may not happen to you, but other financial issues could arise that you need to talk to someone about, and being able to do that face to face can sometimes just be better than trying to deal with problems on a computer or via phone.

3. You need a notary regularly

Many traditional local banks provide more services than you might expect. For example, several times when I have had to have documents notarized, my bank has done that for me for free. If I wasn’t a customer, this service wouldn’t have been available and I would have had to find and pay for a notary.

Your online bank isn’t going to have a branch you can visit if you need a notary to witness you signing something, so if you do this even a few times a year, maintaining an account at your local bank could be worth it.

4. You want a safe deposit box

Finally, if you have important documents to keep in a safe deposit box, you’ll need to find a bank that offers this. Some banks only allow customers to open safe deposit boxes, so you could be out of luck if you don’t have an account with one.

If any of these apply to you, a switch to an online bank may not be the right move. Just be sure that if your local bank is charging you any fees an online bank wouldn’t, that paying them is worth the perks you get. If not, there could be other financial institutions with physical branches that could offer these benefits without the downsides, so it’s worth looking into your options.

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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Christy Bieber has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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