Chime Review: What To Know Before Signing Up

Chime Review: What To Know Before Signing Up

No matter how big or small your household budget is, you want to avoid being nickel and dimed by your bank.

That’s why I was so intrigued by Chime, an almost zero-fee online bank. Is it too good to be true, or can Chime help you save money, automate your finances, and simplify your financial life?

With Chime, you’re getting a mobile-only bank with unique features like round ups, automatic savings, and a very low and transparent fee structure. The biggest drawback is the limitations on mobile check deposits. As such, Chime is ideal for those who carry a relatively low balance and aim to avoid costly banking fees.

  • Low and transparent fee structure.
  • Valuable savings tools like round ups and automatic transfers.
  • Highly-rated app for managing your money on the go.
  • Early access to direct deposits.
  • Above average interest rate at 1%.
  • Limitations on cash and check deposits.
  • No support for joint accounts.

Chime Review: Overview and Key Benefits

And after a recent series of scandals that included things like opening accounts for customers without their knowledge, improper foreclosures, and the not-so-small matter of its role in the 2008 financial collapse, that reputation has only gotten worse.

As a result, and understandably, many people have grown to deeply distrust the banking system. But the truth is that it’s difficult to navigate the modern world without a standard checking account, and trying to do so can be extremely expensive.

A 2016 New York Times story titled “The Unbanked” notes that customers without bank accounts typically pay anywhere from 3% to 15% for financial transactions (like cashing a check) that would be free for account holders.

One of the most notable aspects of Chime is that unlike the big banks that charge tons of fees (often to the customers who can least afford them), it charges almost no fees at all.

That’s made possible in part by the fact that Chime is an online-only bank. That means there are no brick-and-mortar locations, which results in lower overhead and big savings that can be passed on to customers.

Chime offers free checking and savings accounts, free money (more on that later), and even early access to your paycheck. It also offers two valuable savings tools – round ups and automated saving – that can help you meet your goals and get (or keep) your finances on the right track.

How It Works: ChimeChecking Account

Chime’s checking accounts are called “spending accounts,” which makes sense since debit cards (most people’s preferred spending method) draw from checking accounts. There’s no minimum balance requirement for a Chime spending account.

Direct Deposit

You’ll have a standard routing and account number (just like with a traditional checking account), so you can easily add money to your spending account via direct deposit.

However, unlike with traditional accounts, direct deposits into your Chime spending account are processed immediately – not held for a period of time (usually one day) as is the practice at many other banks. Additionally, Chime customers have access to their direct deposit up to two days “early.”

When your employer processes payroll, they submit files to the Federal Reserve notifying them how much each employee will be paid that week. The Federal Reserve sends that information to us every day to let us know how much and when you’ll be paid. Instead of waiting until your payday to deposit the funds, we make that money available as soon as we receive the notification.

There is no fee for this service, which makes it a great benefit – especially if used as an alternative to payday loans, which often come with a double or triple-digit interest rate.

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