USAA Banking: No Longer Just for Members of the Military

USAA, the company originally founded to serve U.S. military officers and their families, has long had an excellent reputation for outstanding products and customer service. While USAA auto and property insurance offerings are still only available to military members and their families, the general public can now take advantage of their banking and investments products including checking and savings accounts, CDs, credit cards, mutual funds and brokerage accounts.

For example, you can get a 5-year CD at 3.00% APY or a 7-year CD at 3.55% with a minimum opening deposit of $1,000. If you invest over $94,999 in a CD, the interest rates increase accordingly. Since FDIC limits are now permanently raised to $250,000, it’s now safe to invest in long-term jumbo CDs.

Regular savings accounts start at a 0.40% interest rate for daily balances below $1,000. There is a tiered interest rate structure, based on your daily account balance, and for balances greater than $25,000, you can earn 0.55%. All savings accounts require a $25 minimum opening deposit.

USAA’s free checking account allows unlimited free ATM use, no matter what ATM you use. If another bank charges you an ATM fee, USAA refunds the charge. This is limited to the first 10 ATM withdrawals per month and USAA will refund up to $15 on other banks’ ATM fees each month. They also offer free overdraft protection (they will automatically transfer the needed funds from your savings account or a credit card for free), they give you free checks, free online bill pay, they have no monthly service fees regardless of your checking account balance, and you get a free rewards debit card (PIN-based transactions are excluded). You also earn 0.10% APY interest on your checking account.

One downside is that USAA doesn’t have any brick and mortar locations; all transactions are done through the mail, online, or over the phone. However, the great banking products and their superior customer service can make up for the lack of physical locations, if you can adjust your banking practices a little. If you are dissatisfied with your current bank, you can take solace in the fact that USAA has been rated as one of BusinessWeek’s “Customer Service Champs” for four straight years.