Most checking accounts have no minimum balance requirement, but some do
You do not need a minimum balance to open or keep most checking accounts. Major banks like Chase, Bank of America, and Wells Fargo offer checking accounts with zero minimum balance. Credit unions and online banks typically have no minimum either. However, some accounts—usually those with higher rewards, premium features, or at smaller regional banks—do require you to maintain a set amount, often $500 to $2,500.
The key difference is what happens if you fall below the minimum. Some banks charge a monthly fee (usually $10 to $25) if your balance drops below the threshold. Others waive the fee if you meet an alternative condition, like setting up direct deposit or making a certain number of debit card transactions each month. A few banks will straightforward close your account if the balance stays too low for a set period.
Whether you need a minimum balance depends on your banking habits and which account you choose. If you keep a steady balance anyway, the minimum may not matter. If you run a tight budget and your balance fluctuates, you should look for an account with no minimum or with straightforward waiver conditions.
Key Takeaways
- Most major banks and online banks offer checking accounts with no minimum balance requirement at all.
- Some accounts waive the minimum balance fee if you set up direct deposit or make a certain number of transactions per month, even if your balance dips below the stated minimum.
- Premium checking accounts with higher interest rates or extra perks are more likely to have minimum balance requirements than basic accounts.
- If you cannot meet a minimum balance, you can avoid the fee by switching to a different account at the same bank or moving to a bank with no minimum.
How banks set minimum balance requirements
Banks use minimum balance requirements as a way to offset the cost of maintaining your account. When you keep money in a checking account, the bank can lend that money out and earn interest on it. A higher balance means more lending power for the bank. In exchange, they offer you the account at a lower cost or with added features.
The minimum is usually tied to the account tier. A basic checking account may have no minimum, while a premium or interest-bearing checking account might require $1,000 or $2,500. Some banks set the minimum based on what they think will cover their operating costs for that account type. Others use it as a way to segment customers—keeping lower-balance customers in free accounts and higher-balance customers in accounts with perks.
Regional banks and credit unions are more likely to have minimums than national online banks. This is partly because their operating costs are higher and partly because they rely on customer deposits more heavily to fund loans. Online banks have lower overhead, so they can afford to waive minimums across the board.
What happens if your balance drops below the minimum
The consequences vary by bank and account type. Most commonly, you will be charged a monthly maintenance fee—typically $10 to $25—if your balance falls below the minimum on the last day of the statement period. Some banks check the balance on a specific day each month; others use an average balance over the month. Read your account agreement to know which method your bank uses.
A smaller number of banks will close your account if the balance stays below the minimum for 60 to 90 days. This is rare with major banks but more common at smaller institutions. When an account closes, any remaining balance is mailed to you, and the account is reported to ChexSystems (a banking history database), which can make it harder to open accounts elsewhere for a period of time.
Some banks offer a grace period. For example, they might waive the fee the first time your balance dips below the minimum in a calendar year, or they might give you 30 days to bring the balance back up before charging the fee. Always ask about grace periods when you open an account.
Ways to avoid or waive the minimum balance fee
Many banks let you skip the minimum balance requirement if you meet other conditions. The most common waiver is setting up direct deposit—having your paycheck or government benefits deposited directly into the account. Some banks waive the fee if you receive just one direct deposit per month; others require two or more. This is the easiest waiver to meet if you have a job or receive regular income.
Other common waivers include maintaining a linked savings account with a certain balance, making a set number of debit card transactions per month (often 10 or more), or keeping a credit card with the same bank. A few banks waive the fee if you maintain a minimum balance in a linked savings or money market account instead of in the checking account itself. This can be useful if you want to keep your checking account balance low but still avoid the fee.
Some banks offer tiered waivers. For example, Chase may waive the fee if you maintain a $500 balance OR set up direct deposit OR link a savings account. You only need to meet one condition. Before opening an account, ask the bank which waivers are available and which one fits your situation best.
Comparing accounts with and without minimums
| Account Type | Typical Minimum | Monthly Fee (if minimum not met) | Common Waivers |
|---|---|---|---|
| Basic checking (major bank) | $0 | $0 | N/A |
| Premium checking (major bank) | $500–$2,500 | $10–$25 | Direct deposit, linked savings, debit card transactions |
| Interest-bearing checking | $1,000–$5,000 | $15–$30 | Direct deposit, minimum balance in linked account |
| Online bank checking | $0 | $0 | N/A |
| Credit union checking | $0–$500 | $5–$15 | Direct deposit, membership dues, linked savings |
If you are deciding between accounts, the minimum balance matters less than whether you can meet the waiver conditions. A premium account with a $1,000 minimum is free if you have direct deposit, but costs $20 per month if you do not. A basic account with no minimum is always free, even if your balance is $50. For most people, the basic account is the better choice unless the premium account offers features (like higher interest or better rewards) that are worth paying for.
What to do if you cannot meet the minimum
If you are currently paying a fee because your balance is below the minimum, you have several options. First, contact your bank and ask what waivers are available. You may be able to set up direct deposit or link a savings account and have the fee waived going forward. Some banks will even refund fees charged in the past if you set up a waiver after the fact.
Second, ask whether your bank offers a different account with no minimum. Most major banks have at least one basic checking account with zero minimum and zero monthly fee. You can switch to that account without closing your current one, though you may want to close it eventually to avoid paying multiple fees.
Third, consider switching banks entirely. If your current bank charges a fee and offers no realistic waiver, moving to an online bank or credit union with no minimum may save you money over time. Online banks like Ally, Charles Schwab, and Discover have no minimum balance and no monthly fees. The switch takes a few days and involves updating your direct deposit and automatic payments, but it is straightforward.
Frequently Asked Questions
Can a bank close my account if my balance is too low?
Yes, but it is uncommon with major banks. Some smaller banks and credit unions will close an account if the balance stays below the minimum for 60 to 90 days. When this happens, your remaining balance is mailed to you and the closure is reported to ChexSystems, which can affect your ability to open accounts elsewhere. Check your account agreement or call your bank to find out their policy.
Does a minimum balance requirement affect my credit score?
No. Checking accounts are not reported to credit bureaus, so a minimum balance requirement or a fee for falling below it will not show up on your credit report. However, if your account is closed due to low balance and reported to ChexSystems, it may make it harder to open new bank accounts in the future.
What if I have direct deposit but my balance still drops below the minimum?
If direct deposit is your waiver condition, the fee should not be charged even if your balance falls below the minimum. The waiver is based on the condition being met, not on the balance itself. Confirm this with your bank in writing before relying on it, because some banks have specific rules about when the direct deposit must be received or how much it must be.
Are online banks really free, or do they have hidden fees?
Most online banks have no minimum balance and no monthly maintenance fees. However, they may charge fees for other things—overdrafts, wire transfers, or paper statements. Read the fee schedule before opening an account. The lack of a minimum balance fee does not mean there are no fees at all, just that the most common one is waived.
Can I keep a very low balance and still avoid fees?
Yes, if you choose an account with no minimum balance requirement or if you meet a waiver condition. Many people keep $100 or less in their checking account and pay nothing. The key is picking the right account type for your situation and confirming the bank's fee structure before you open it.