USAA Bank Review: Savings, Money Markets and CD
If you’re a member of the military, being able to access your money when you need it matters.
USAA Bank caters to members of the military and their families to help serve their banking needs. But is USAA a credit union, bank or something else?
Here’s more on how this financial institution works and what USAA offers to help meet banking needs.
What is USAA Bank?
Founded in 1922 in San Antonio, Texas, USAA Bank offers a variety of banking products and services to military members, their families and those with military affiliations.
Nearly a century later, the bank continues to offer checking accounts, savings accounts, loans, insurance products and investing products to its members.
|USAA Bank||Popular Accounts||Account Features & Fees||Pros & Cons||Locations|
Popular USAA Bank Accounts
|USAA Savings Account||Pay no monthly service fees and meet no minimum balance requirements.|
|USAA Performance First Savings Account||Earn higher rates on savings with mobile check deposit and 24/7 fraud protection.|
|1-Year CD||Early withdrawal penalties applied when taking money from your account before your CD matures.|
|5-Year CD||Early withdrawal penalties applied when taking money from your account before your CD matures.|
Which Banks Have the Best CD Rates?
Hundreds of banks offer CDs, and there’s a big competition among them to offer the best rates and terms. Use our CD rate-finder tool below to sort through the list to find a CD that fits your financial goals.
How USAA Bank Works
If you’d like to open a savings account or any other account with USAA Bank to reach your financial goals, there are some important eligibility requirements to meet.
Specifically, you can only open a USAA Bank account if you:
- Are an active-duty military member or veteran
- Are the spouse or child of an active-duty military member or veteran
- Are a pre-commissioned officer
USAA Bank offers a number of different banking products and services, including deposit accounts, loans and credit cards. For the purposes of this USAA Bank review, we’ll be taking a closer look at savings accounts and certificates of deposit.
There’s no monthly fee for the USAA Savings Account or the USAA Performance First Savings Account. That’s a good thing since fees can detract from the interest you earn on your savings.
CD accounts don’t have a monthly fee either, nor do any of the USAA checking account options available.
A few other fees to note include:
- ATM fees for using non-USAA ATMs
- USAA overdraft fee for checking accounts
- Early withdrawal penalties for taking money out of a USAA CD before your CD matures
If you don’t have a USAA checking account, then the biggest fees to watch out for are the excess withdrawal fees and the early withdrawal penalty for CD accounts.
When you need to withdraw funds from a USAA savings account, you can do so by visiting a branch location or scheduling an ACH transfer. You can also make withdrawals via wire transfer, though a fee applies for that. USAA savings accounts also come with an ATM card for convenient withdrawals. Just note that they don’t come with debit cards for making purchases.
Since USAA Bank has limited physical locations, you may rely mainly on online banking or mobile banking to manage your accounts. The good news is that both online and mobile banking make it easy to check your balances, transfer money between accounts and add money via mobile check deposit.
If you need help with your USAA Bank accounts, customer service is available by phone. You can also mail in requests or questions or send a secure message via email. Live chat is not an available customer service option at this time.
USAA Bank Savings Accounts
USAA offers interest rates on savings accounts that are about what you’d expect from a traditional brick-and-mortar bank. The USAA Savings Account offers the same APY across all balances, regardless of whether you save a little or a lot.
The USAA Performance First Savings Account features a tiered APY structure. But to get the best interest rate and APY for that account, you need to have a minimum balance of $1 million. You can open a regular savings account with $25 while a Performance First Savings Account requires a $10,000 minimum deposit.
|USAA Savings Account||Amount||Notes|
|Monthly Maintenance Fee||None|
|Minimum Balance Fee||None|
|Excess Withdrawal Fee||$10 per occurrence||Once you hit three occurrences, your savings account will be converted to a USAA checking account or be closed altogether.|
|Wire Transfer Fee||$20 (outgoing)|
USAA Bank Money Market Mutual Fund
In addition to savings accounts and CD accounts, you could also open a USAA money market mutual fund. It’s important to know, however, that this is a money market mutual fund and not a money market account.
Money market mutual funds are investments, not savings accounts. While money market accounts can offer safety with a predictable rate of return, money market mutual funds can offer the potential for higher returns but they also carry a higher degree of risk.
The USAA Money Market Mutual Fund requires a $1,000 minimum investment. The fund invests in short-term debt securities. Before opening a money market mutual fund account, it’s helpful to first read the fund prospectus so you better understand what you’re investing in.
USAA Bank CD Rates
USAA CD rates are slightly higher compared to USAA savings account rates. To get the best rate, though, you’ll need to choose the longest CD term. That’s a trade-off to consider if you’re looking for a shorter period of time to wait until your CD matures.
Overall, USAA interest rates are lower than what you could find at many online banks. In the America’s Best Rates Survey, for example, UFB Direct topped the list of best savings account rates while CIT Bank offered the best money market rates.
It’s important to keep in mind, however, that savings and CD rates are down across the board because of the Federal Reserve’s decision to slash interest rates to near-zero early in 2020. Generally speaking, when choosing between banks or credit unions, online banks may be the best choice for earning a higher interest rate.
|USAA Bank CD Accounts||Term||Notes|
|1-Year CD||12 months||Early withdrawal penalty 90 days’ simple interest on the principal at the rate in effect for the CD|
|5-Year CD||60 months||Early withdrawal penalty 180 days’ simple interest on the principal at the rate in effect for the CD|
USAA Bank Checking Accounts
USAA Bank offers checking accounts, including one that offers rewards and another that allows you to earn interest.
The Classic Checking account earns interest on balances of $1,000 or more. The USAA Cashback Rewards Checking account gives you 10 cents back with each qualified debit card purchase. You can open either account with an initial $25 minimum deposit and neither one charges any monthly service fees.
USAA Personal Loans
In addition to savings accounts and CDs, USAA offers personal loans of up to $5,000. You can apply for personal loans online and, if approved, use the funds for a variety of expenses such as debt consolidation or paying for home repairs.
USAA Bank Pros & Cons
Banking at USAA Bank is a little different than opening accounts at another financial institution. Here’s a quick look at some of the main highlights of USAA Bank.
- You can earn a competitive interest rate on savings and CD accounts.
- Pay no monthly fee to maintain a savings account or CD account and no monthly maintenance fee with certain checking account products.
- Savings accounts, CD accounts and other deposit accounts are insured by the FDIC.
- Manage all of your finances in one place with insurance, investment and loan options.
- Aside from offering various ways to save and bank, USAA members enjoy additional benefits such as special discounts, loan incentives and the opportunity to reduce credit card interest rates while on deployment.
- If you don’t meet the military affiliation eligibility requirements, you won’t be able to open an account with USAA.
- While you can access your account via online banking, mobile banking and ATMs, USAA Bank doesn’t offer quite as many branch locations for in-person banking.
Locations – Branches & ATMs
USAA has more than 20 branch locations across the country and an extensive ATM network. You can access your account via ATM at more than 60,000 locations nationwide.