The best banks and credit unions for military members and their families, October 2021

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The best banks and credit unions for military members and their families

We’ve provided an overview of our favorite banks and credit unions for military members and families here. Scroll down to read our breakdown of each institution’s pros and cons.

BankSavings APYWhy we like itNext steps

0.01% to 0.20% APYStrong digital bankingUSAA USAA Classic Checking Account

0.25% APYBranch locationsNavy Federal Credit Union Navy Federal Free Active Duty Checking™ Account

0.70% APYAccount interest ratesPentagon Federal Credit Union Pentagon Federal Credit Union Premium Online Savings Account

0.05% APYPartners with other credit unions for more branchesSecurity Service Federal Credit Union Security Service Power Checking Account

0.25% to 5.00% APYDiscounts on loansService Credit Union Service Primary Everyday Checking Account

0.01% to 0.05% APYDebt forgivenessChase Military Banking

A good military bank should make it easy for you to access your money, loans, and investments from wherever you are in the world. It should also provide special incentives for military members and families, such as discounted loans or high interest rates on bank accounts.

Learn more about our top picks for banks and credit unions for military members and their families. Each one is federally insured to keep your money safe, and has competitive perks for the military.

Our expert panel for this guide

We consulted banking and financial planning experts – including Tania Brown, a veteran of the US Army – to inform these picks and provide their advice on finding the best bank accounts for your needs. You can read their insights at the bottom of this post.

We’re focusing on what will make a bank most useful for military families, including branch and ATM locations, savings rates, variety of military products, and more.

Learn more about our top picks

USAA

USAA Classic Checking Account

Who can join: Active military, veterans, and families of active military or veterans can bank with USAA.

Why it stands out: You can withdraw or make deposits at 1,200 USAA ATMs for free. There are also 60,000 USAA-preferred ATMs around the US, and the first 10 monthly withdrawals are free. If you use an out-of-network ATM, USAA will reimburse up to $15 per month in fees charged by the ATM provider.

USAA offers a wide range of products, including bank accounts, investment accounts, insurance, loans, and mortgages. You’ll also receive your direct deposit one day before payday.

USAA could be a good military bank if you’re comfortable banking digitally. Its mobile app has strong ratings, including 4.8 out of 5 stars in the Apple store with over 1 million reviews.

What to look out for: Limited physical locations. USAA only has offices in a few US states, England, Germany, and Luxembourg. It’s really a better fit for people who want online and mobile access to their bank.

Navy Federal Credit Union

Navy Federal Free Active Duty Checking™ Account

Who can join: Active military, veterans, employees or retirees of the Department of Defense, and family members of any of the aforementioned groups are eligible.

Why it stands out: Navy Federal is a great choice if you want in-person branch access. There are 247 branches around the world, including in North America, Europe, Africa, and Asia. Some of its branches are on select military bases.

There are over 500 Navy Federal ATMs. You also have free access to 30,000 CO-OP ATMs in the US and Canada and to 1,100 CashPoint ATMs in North Carolina, and access to 2 million Visa/PLUS ATMs worldwide. If you use an out-of-network ATM, Navy Federal will reimburse up to $20 per month in fees charged by ATM providers for Navy Federal Free Active Duty Checking, and $10 per month for other checking accounts.

Along with bank accounts, Navy Federal provides loans, credit cards, mortgages, investment accounts, and insurance.

What to look out for: The cost of using your debit card outside of the US and Canada. There are plenty of Visa/PLUS ATMs worldwide, but Navy Federal charges a $1 fee when you use one. Some in-network ATMs will charge a 1% international assessment fee.

Navy Federal does reimburse between $10 and $20 per month for ATM fees. These refunds apply to the $1 charge for Visa/PLUS ATMs, but not toward the 1% ISAs.

Pentagon Federal Credit Union

Pentagon Federal Credit Union Premium Online Savings Account

Who can join: You can be a member of the military, employee of an eligible association or business, employee of certain US government agencies, worker or volunteer at the American Red Cross, resident of certain areas, or family member of anyone who falls into one of these groups.

Otherwise, you can become a PenFed member by opening a savings account with $5.

Why it stands out: PenFed could be a good fit if you want to earn high interest rates. You’ll earn 0.70% APY on PenFed Premium Online Savings, 0.20% to 0.40% APY on PenFed Access America Checking, and 0.30% – 0.90% APY on PenFed Money Market Certificate.

PenFed has branches in 13 US states and DC, and on military bases in Guam, Puerto Rico, and Japan. You’ll also have free access to around 68,000 ATMs.

PenFed offers credit cards, loans, mortgages, and investment accounts.

What to look out for: ATM fees. PenFed charges $1.50 when you use an out-of-network ATM, and unlike some of our other top picks, it doesn’t reimburse any fees charged by out-of-network ATM providers. You’ll also be charged up to 2% for using your debit card or credit card outside the US.

Security Service Federal Credit Union

Security Service Power Checking Account

Who can join: You may be eligible as a member of certain military branches at select bases. As a citizen, you can join if you live, work, study, worship, or have a business in Colorado, Texas, or Utah. Or you can join if you’re a relative of a current Security Service member.

Why it stands out: Security Service FCU has branches in Colorado, Texas, and Utah. It also participates in CO-OP shared branching. This means you can make deposits, withdrawals, or loan payments at 5,000 other credit unions throughout Louisiana, New Mexico, Oklahoma, and Texas, which is helpful if you don’t live near a Security Service branch.

You have free access to Security Service ATMs and Stripes ATMs in areas with branch and shared branch locations. You can also use 30,000 CO-OP ATMs for free around the US.

Security Service FCU offers bank accounts, loans, credit cards, mortgages, investment accounts, business accounts, and insurance.

What to look out for: ATM fees. Security Service FCU charges $1.50 when you use an out-of-network ATM fee, and it doesn’t refund any fees charged by out-of-network ATM providers. You’ll also be charged a 1.10% fee for using your debit or credit card abroad.

Service Credit Union

Security Primary Everyday Checking Account

Eligibility: You can join Service Credit Union as an active or veteran military member, or as a current or former Department of Defense employee. Citizens of New Hampshire or parts of Massachusetts are eligible. You can also join if you’re a family member of someone who qualifies.

Why it stands out: With a Service Primary Everyday Checking Account, you can receive discounts on certain loans. You’ll receive a 0.50% discount if you qualify for the Direct Deposit tier, and a 0.75% discount with the Direct Deposit+ tier.

Service Credit Union provides loans, bank accounts, mortgages, credit cards, business loans, insurance, and investment accounts.

Service Credit Union has branches and ATMs in parts of the US and Europe. The credit union won’t charge you for using an out-of-network ATM, but the ATM provider might. In this case, you can receive up to $15 or $30 per month in reimbursements for the Direct Deposit and Direct Deposit+ tier, respectively.

The Primary Savings Account pays a very high APY on your first $500. The rate drops on balances over $500, but it’s still higher than what many banks pay.

You can contact a customer service representative over the phone 24/7, or chat live online.

What to look out for: Discounts on certain types of loans. Service Credit Union’s loan discounts do not apply to business loans, lines of credit, home loans, VISA loans, or certificate/share secured consumer loans. But you may be able to get a discount on personal loans, vehicle loans, or student loans.

Chase Military Banking

Chase Premier Plus Checking℠

Eligibility: You can receive Chase military benefits as an active, veteran, reserve, or National Guard military member.

Why it stands out: Chase isn’t a military bank, but it does have benefits for military members. When you open a Chase Premier Plus Checking℠ account, Chase waives the $25 monthly fee; gives you a free safety deposit box; lets you use out-of-network ATMs for free four times per month; gives you free counter checks, cashier’s checks, and money orders; waives the monthly fee for up to two additional checking accounts and a savings account.

Active duty members and reservists for the Air Force, Army, Coast Guard, Marines, National Guard, and Navy receive additional benefits if you set up military direct deposits. Benefits include unlimited waived fees for out-of-network ATMs; free incoming and outgoing wire transfers; free foreign exchange rate adjustments when you use your debit card or an ATM with a currency other than US dollars.

Chase also has business accounts, mortgages, and auto loans for military members. The Survivor Program forgives debts of spouses and dependents of military members killed in action.

What to look out for: Bank accounts for military family members. You can add a family member to your account, but military family members can’t receive military benefits on their own accounts. For example, if you’re an active military member with an 18-year-old child who wants to open a Chase Premier Plus Checking℠ account, then the child would still have to pay the monthly fee.

Other military banks and credit unions we considered, and why they didn’t make the cut

Air Force Federal Credit Union IRA Share Certificate: This is a solid credit union, but AFFCU doesn’t reimburse out-of-network ATM fees charged by ATM providers, and you can find higher savings rates elsewhere.Armed Forces Bank Savings Account: This bank charges monthly service fees on checking and savings accounts, but you might like it if you qualify to waive the fees.Bank of America Advantage Relationship Account: This is another big bank with military offerings, but it doesn’t have anything equivalent to Chase’s Survivor Program.US Bank Standard Savings Account: Another good national bank with military services, but its benefits aren’t as robust as what Chase offers.Wells Fargo Savings Account: Wells Fargo has a lot of resources for military members, but you still might prefer Chase if you’re interested in the Survivor Program.Andrews Federal Credit Union Free Checking Account: This is a fine credit union, but nothing makes it stand out from our top picks.

Are these banks and credit unions trustworthy?

The Better Business Bureau grades companies’ trustworthiness by evaluating responses to customer complaints, advertising, and transparency about business practices. We’ve included the BBB grades for all of our top picks:

InstitutionBBB gradeUSAAA+Navy Federal Credit UnionA+Pentagon Federal Credit UnionA+Security Service Federal Credit UnionA-Service Credit UnionA+ChaseA+

Security Service Federal Credit Union has an A- for not responding to 2 complaints.

A strong BBB score doesn’t guarantee you’ll have a smooth experience with a company, though. You may want to ask friends and families for their opinions, or read online reviews. You could also consider any recent scandals.

In 2019, USAA paid $12 million to customers after the Consumer Financial Protection Bureau said the bank didn’t stop automatic payments when customers requested.

A Navy Federal employee claimed the lender pressured mortgage underwriters to approve loans even if they didn’t have sufficient reason to believe applicants could repay the loans. Then she filed a lawsuit and said Navy Federal retaliated against her whistleblowing by changing her job duties. She dropped the case in late 2020.

The Department of Justice required Chase to pay $920 million for wrongful trading in 2020. In 2018, JPMorgan Chase & Co. paid the Securities and Exchange Commission $135 million for mishandling American Depositary Receipts, certificates that let Americans invest in foreign stocks.

If any of these issues worry you, you may prefer to go with another bank or credit union on our list.

Frequently asked questions

Why trust our recommendations?

Personal Finance Insider’s mission is to help smart people make the best decisions with their money. We understand that “best” is often subjective, so in addition to highlighting the clear benefits of a financial product or account – a high APY, for example – we outline the limitations, too. We spent hours comparing and contrasting the features and fine print of various products so you don’t have to.

Why choose a military bank over another type of bank?

If you’ve served in the military or have a family member who has served, then you might want a financial institution that is specifically set up for military members. This could mean either a military bank or credit union, or an institution that has special services for military members.

Most military banks let you receive your paycheck one or two days earlier than other institutions, which gives you access to your money faster and helps you start accumulating interest sooner.

Banks with military benefits often issue loans specifically for military members. For example, you could qualify for a VA mortgage, which doesn’t require any down payment. Other banks may not offer VA loans.

Military banks and credit unions typically have a large ATM and/or branch network, because military families tend to move around a lot. Some may even have branches and ATMs on or near military bases, which makes banking much more convenient for you.

How did we choose the best financial institutions for military members and their families?

We looked at military banks, military credit unions, and financial institutions that aren’t specifically for the military but have products geared toward military members. We chose banks and credit unions that had a wide range of ATMs, and preferably out-of-network ATM fee reimbursements, since military members travel frequently.

Our top picks also had to make it easy to access your money – either with a large branch network and branches near military bases, or with strong online services. We also selected ones that provided multiple products for military members, including bank accounts, loans, and mortgages.

What’s the difference between a bank and credit union?

A bank is a for-profit company. Almost anyone can keep money with a bank, as long as you have the necessary minimum opening deposits.

A credit union is a not-for-profit financial institution owned by its members. You must become a member to bank with a credit union, and each business has its own rules about who can join.

Which is better, a bank or credit union?

Banks and credit unions each come with their pros and cons, so it depends on what you want out of a banking institution. For example, banks often have stronger technology, but credit unions are known for good customer service.

If you’re searching for high interest rates on your savings accounts, your choice between a bank and credit union could be a little tricky. Credit unions typically pay higher rates, but they only compound your interest monthly. Banks usually compound interest daily, which helps you earn more in the long run.

If the difference in interest rates is minuscule, then you might want to go with a bank that compounds interest daily. But if a credit union pays significantly higher rates than a bank – say, 5% versus 0.01% – then the higher rate with less frequent compounding will still earn you more.

The experts’ advice on choosing a military bank or credit union

To learn more about what makes a good military financial institution and how to choose the best fit, four experts weighed in:

Tania Brown, certified financial planner at SaverLife and US Army veteranRoger Ma, certified financial planner with lifelaidout® and author of “Work Your Money, Not Your Life”Mykail James, MBA, certified financial education instructor, BoujieBudgets.comLaura Grace Tarpley, associate editor of banking, Personal Finance Insider

Here’s what they had to say about choosing a place to bank. (Some text may be lightly edited for clarity.)

What should someone look for in a military bank?

Tania Brown, CFP:

“In the military, you have no idea where you will be living every few years, so it’s important to have a bank that can travel with you. First is accessibility – you have to have easy access to services, either through multiple locations or technology. You should easily be able to handle every transaction by phone or by computer.

“Second, the hours should be long enough for you to reach them if needed, no matter where you are in the world.

“Third, either an ATM network of banks or ATM fee reimbursements so you are not continuously charged every time you take out cash.”

How can someone decide between a bank and a credit union?

Laura Grace Tarpley, Personal Finance Insider:

“Look at interest rates and how often interest compounds. The more often an institution compounds interest, the more money you’ll earn. Many credit unions pay higher rates than banks. But they only compound interest monthly, whereas banks compound daily. Do the math to figure out where you’ll earn the most.”

Tania Brown, CFP:

“For most people, it falls into five categories: location, interest rates, services, technology, and relationships. Next, prioritize what’s important and you will have your answer. For instance:

If multiple regional and national locations are important: Banks typically have more locations than credit unions.If the most important thing to you is a high interest rate: Credit unions, on average, offer better interest rates than banks.If a lot of services (commercial banking, business banking, investment services, etc.) are valuable to you: Larger banks offers more services than most credit unions. If feeling like a person, not a number, matters to you: Credit unions are known for great personalized customer service.If you are a tech junkie: Larger banks typically offer more tech bells and whistles for online users than credit unions.”

What makes a savings account good or not good?

Roger Ma, CFP:

“It might not be as seamless to get your money out of an online savings account as it is a brick-and-mortar, but you don’t want to have so much friction where it’s such a pain to get the money out when you need it.”

Mykail James, CFEI:

“Anything with a fee is not a good high-yield savings account. Anything that restricts how much you can save is, to me, not very good. If I can’t save more than $10,000 in this account, and then I have to move it over somewhere else – to me, that’s not a really good savings account, because it’s not really prepared to help me expand and grow, which is what a savings account is supposed to do.

“I also look at interest rates, definitely. I look to see when the interest is paid. Is it quarterly, or is it monthly? How often do they pay out interest, and what are the interest rate stipulations?”

What makes a checking account good or not good?

Roger Ma, CFP:

“I would look at the ATM branch locations and then minimum balance amounts to not incur a monthly fee … I think there’s other stuff that could make life easier, whether it’s a free checks, online bill pay, or are they in the Zelle network?”

Laura Grace Tarpley, Personal Finance Insider:

“Make a list of the top three to five things you want out of a checking account. Is it a great mobile app, 24/7 customer support, no ATM fees? Then research the best banks for those features.”

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