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State Farm Bank Review

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We maintain strict editorial integrity in our writing and assessments. This post contains links from our advertisers, and we may receive compensation when you click these links. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone. | Advertiser Disclosure
State Farm Bank Consumer Savings Account
0.10% APY

Online-only banks have become an increasingly popular trend in the modern banking industry, and State Farm Bank is one of the main players. Although it has no branches, you can view all of your account balances and transaction histories online, deposit checks remotely through the mobile app and use the ATM locator so you can take out cash without having to pay any fees.

The array of accounts offered at State Farm is extremely similar to what you would find at any traditional bank in the U.S. So whether you’re in need of a savings account, checking account, certificate of deposit (CD), IRA, money market account (MMA) or anything in between, this bank has an option available for you.

Products Offered

Product Key Details
Savings Accounts
  • Competitive rates
  • Free ATM/debit card
  • As much as $10 in out-of-network ATM fee rebates every statement cycle
  • Relationship savings rates available for eligible account holders
Checking Accounts
  • Interest earned only on accounts with a balance of $2,500 and up
  • ATM fee rebates each statement cycle up to $10
  • Waivable or no minimum balance fees
  • Overdraft protection
Money Market Accounts (MMAs)
  • 1.85% introductory interest rate
  • $1,000 minimum opening deposit
  • No monthly fees with a $500 average daily balance
  • Interest compounded daily
Certificates of Deposit (CDs)
  • Tiered interest rates based on term length and account balance
  • Interest compounded daily
  • $500 minimum to open
Individual Retirement Accounts (IRAs)
  • Traditional, Roth and rollover IRAs
  • Anywhere from $500 to $1,000 to open an account
  • Tiered interest rates
  • Interest compounded daily

State Farm Bank Interest Rate Comparison

State Farm Bank Overview

State Farm is known to many as an insurance provider, and it can trace its roots back to 1922 in that business. Its standalone banking branch, State Farm Bank, has only been in the market for around 20 years, but it does have the resources of one of the largest companies in the U.S. to back it up.

State Farm Bank Consumer Savings Account

Key Features Details
Minimum Deposit $0
Access to Your Account Branches, online, mobile and ATMs
Security FDIC insurance up to the maximum amount allowed by law
Fees $3 monthly service fee; waivable by maintaining an $100 average daily balance or making at least one direct deposit each statement cycle
Current Terms and Rates
  • Rates are tiered based on balance:
    • $0 - $4,999: 0.10% APY
    • $5,000 - $4,999,999: 0.30% APY
    • $5,000,000 +: 0.10% APY

State Farm’s Consumer Savings account is the most standard savings option at the bank. It comes with all the standard features, like an easily waivable monthly service fee, accessibility to online/mobile banking and out-of-network ATM fee rebates. More specifically, to get rid of the $3 monthly fee, you’ll need to both have a direct deposit sent to your account and maintain an average daily balance of $100 within the account. Non-State Farm ATM fee rebates are limited to $10 per statement cycle, so try not to overuse unincluded ATMs.

If you’re looking to begin a college savings plan for your children, State Farm offers a selection of government-run 529 plans. The laws of the state you live in dictate the  rules and regulations governing these accounts, so there’s no extra benefit to start a 529 plan at State Farm over any other bank. However, if you own existing accounts, or are looking to move your funds here, it might not be a bad idea to keep everything in one place.

You can also open a health savings account (HSA) at State Farm Bank. These increasingly common accounts allow those with expensive healthcare plans the ability to pre-save for medical costs on a tax-free basis. A $100 deposit is required at the time you open an HSA, and State Farm will hand you a Health Savings Visa® debit card to account holders to pay for medical bills.

Compare State Farm Bank to Other Competitive Offers

State Farm Bank Interest Checking Account

Key Features Details
Minimum Deposit $0
Access to Your Account Branches, online, mobile & ATMs
Security FDIC insurance up to the maximum amount allowed by law
Fees $10 monthly service fee; waivable by maintaining a $500 average daily balance or making at least one direct deposit each statement cycle
Current Terms and Rates
  • Rates are based on balance:
    • $2,500 and up: 0.25% APY

The Interest Checking account at State Farm Bank attempts to combine the perks of an uber-accessible checking account with the interest-earning possibilities of a savings account. There is a rather high $10 monthly service fee, though you can avoid it by simply keeping a $500 minimum daily balance and making one direct deposit to the account. However, you’ll only earn interest if you maintain a balance over $2,500.

The standard checking account at State Farm is perfect if you’re looking for a simple account to keep your money in. It comes with no monthly fees, no minimum balance requirement and an out-of-network ATM fee reimbursement program that’s unlimited with a direct deposit to your account (if not, $10 per statement cycle). In order to open an account, you’ll need a meager $25 ready to deposit.

Each of these accounts come paired with a State Farm Bank Visa® debit card that you can use at both in- and out-of-network ATMs and for purchases. You’ll also have the option to sign up for overdraft protection with both accounts. Just remember that if you decide to use this service, you must pair it with either another State Farm Bank bank account or State Farm® Visa® credit card.

State Farm Bank Money Market Savings Account

Key Features Details
Minimum Deposit $1,000
Access to Your Account Branches, online, mobile & ATMs
Security FDIC insurance up to the maximum amount allowed by law
Fees $10 monthly service fee; waivable by maintaining a $500 average daily balance or making at least one direct deposit each statement cycle
Current Terms and Rates
  • Introductory rates:
    • $0 - $4,999: 1.85% APY
    • $5,000 - $4,999,999: 1.85% APY
    • $5,000,000 and up: 0.50% APY
  • Base rates:
    • $0 - $4,999: 0.50% APY
    • $5,000 - $4,999,999: 1.01% APY
    • $5,000,000 and up: 0.50% APY
  • Relationship rates:
    • $0 - $4,999: 1.85% APY
    • $5,000 - $4,999,999: 1.85% APY
    • $5,000,000 and up: 0.50% APY

Money market accounts are a great way for those with a solid amount of money to get a safe and reliable interest return. In fact, in the case of State Farm’s MMA, you’ll receive an introductory APY of 2.00%, which is nearly triple the base rate. Alongside with these solid interest rates, though, is a $10 monthly service fee. As long as you can stay about the $500 threshold when it comes to your account’s balance, and you receive at least one direct deposit per statement cycle, this fee will be completely voided.

If you own a checking account with State Farm in conjunction with the MMA, you’ll have access to special Gold and Silver relationship interest rates. The Silver tier is fairly easy to reach, as you either need to make 10 withdrawals from your checking account or keeps its daily balance above $2,500. For the gold rates, however, you’ll need a checking account balance higher than $2,500, 10 withdrawal transactions and a State Farm credit card to your name.

Account holders receive a number of other benefits, including a free ATM card, an out-of-network ATM fee reimbursement program, optional overdraft protection and free money market checks. You can also keep track of your account online and via State Farm’s app, including cross-account transfers and transaction histories.

State Farm Bank Consumer CDs

Key Features Details
Minimum Deposit $500
Access to Your Account Branches, online & mobile
Security FDIC insurance up to the maximum amount allowed by law
Fees None
Current Terms and Rates
  • Rates tiered based on term length and amount:
    • 12-month: 1.75% APY
    • 24-month: 1.80% APY
    • 30-month: 2.10% APY
    • 36-month: 1.85% APY
    • 48-month: 1.90% APY
    • 60-month: 2.25% APY

Whereas many similar banks will offer around eight to 20 various term certificates of deposit (CDs), State Farm Bank only has six different options available. These range from 12 months all the way to 60 months (five years), with significant interest rate hikes as you choose longer terms. The highest APY you can get is 2.25%, which is right in line with or better than a solid portion of the banking market.

Whenever your CD term is up with State Farm, the bank will allow you a 10-day window to decide what you want to do with your money. You can either withdraw all of the funds penalty-free, take out part of the funds and reinvest the rest in another CD or you can simply carry over everything and open a different term CD.

State Farm Bank IRA CD & Money Market

Key Features Details
Minimum Deposit
  • IRA CD: $500
  • IRA MMA: $1,000
Access to Your Account Branches, online & mobile
Security FDIC insurance up to the maximum amount allowed by law
Fees None
Current Terms and Rates
  • IRA CD (rates tiered based on term length):
    • 12-month: 1.75% APY
    • 24-month: 1.80% APY
    • 30-month: 2.10% APY
    • 36-month: 1.85% APY
    • 48-month: 1.90% APY
    • 60-month: 2.25% APY
  • IRA MMA (rates tiered based on account balance):
    • $0 - $4,999: 0.50% APY
    • $5,000 - $4,999,999: 1.01% APY
    • $5,000,000 and up: 0.50% APY

Saving for retirement is many times easier said than done, but State Farm provides two different accounts that should make it fairly easy to get the process started. The individual retirement account (IRA) options at this bank come in a CD and money market form, and are expectedly titled the IRA CD and IRA Money Market. Each of these accounts are available in a traditional and Roth variation, meaning they’re tax-deferred and pre-tax, respectively.

The IRA CD is extremely simple, as it allows you to set aside money and essentially just let it sit and grow on its own. All you need is $500 to get started, and interest is compounded daily to ensure that your growth occurs as quickly as possible. Similar to a regular CD, you have a 10-day period to decide what you want to do with the funds in your CD after it matures.

If you’d prefer to mindlessly contribute money from each paycheck to an account, the IRA MMA might be the best choice for you. It does require $1,000 to open, though, but you will get the benefits of a normal bank account with it, whereas a CD is untouchable. Specific interest rates are also tiered with this type of account, so the more you save, the better.

Where Can I Find State Farm Bank?

State Farm Bank does not have any physical locations, making it an entirely online bank. Therefore, the majority of your contact with the bank will be through their online and mobile platforms, which are available for both Apple and Android systems. If you need to talk to an employee, you can call State Farm’s phone line at 877-SF4-BANK.

What Can You Do Online With State Farm Bank?

Whether you want to open a bank account, check your balance or deposit money, you can do everything online with State Farm Bank. Any computer, tablet or smartphone that’s connected to the internet will be able to access these services. You can always call the company’s hotline or check the frequently asked questions (FAQs) if you ever need information beyond what the bank’s app and website provides.

Between the Apple and Android stores, State Farm’s app is rated at about 3.5 stars. You can deposit checks remotely through the app with MyTime Deposit®, view images of past checks, utilize online bill pay and transfer funds between your internal accounts. The bank will even allow you to send money to people outside of the bank so you can pay back any debts you might have without having to write out a check.

How Do I Access My Money?

Because State Farm Bank is a completely online financial institution, the best way to get to your money is to use its mobile app and website. Through these, you can transfer money both between your own State Farm accounts and to an outside account. Depositing funds into your accounts is equally as easy, as mobile check deposit allows you to take a snapshot of your check and send it in to the bank.

Most accounts also come with a debit card, which you can use on purchases to spend money directly  from your account. You can swipe debit cards at ATMs so you can get your hands on cash whenever you need it. While State Farm doesn’t charge any out-of-network ATM fees, State Farm typically limits other ATM fees to $10 per statement cycle.

The mobile app includes an ATM locator, if you can’t find a fee-free one on your own. State Farm is part of the NYCE deposit-sharing ATM network, as well as the Visa and PLUS networks.

How Can I Save More Money With a State Farm Bank Account?

The best way to make more money with State Farm Bank is to take advantage of its best APY offers. These include the high introductory APY Money Market Savings account and long-term CDs. You’ll also find yourself eligible for higher interest rates if you can manage to qualify for the relationship savings APYs.

For the most part, State Farm compounds interest on customer accounts daily, which can help you money grow a little bit quicker in the long run. While this likely won’t make an exponentially large difference, it does represent a slight upgrade over other banks.

What’s the Process For Opening an Account With State Farm Bank?

State Farm Bank does not have any branches, so you must complete the account-opening process online. If you find yourself struggling to finish the application through the internet, you can also call a representative to help you take care of things. However, in either scenario, make sure you have available your Social Security number, driver’s license and any funds necessary to open the account.

What’s the Catch?

Many people may find that working with online-only bank is a struggle, especially if you have a complex situation to work out. Unfortunately, if this describes you, you may find State Farm Bank to be the wrong choice for your needs. The bank does make a good effort to accomodate customers though, as it boasts a 24/7 phone line, as well as a popular online banking website and mobile app.

Bottom Line

State Farm Bank is a standard bank, with a not-so standard setup. In other words, although it’s run as an branch-less bank and offers premium mobile and online banking services, none of its accounts or benefits are particularly compelling.

The only exception to this rule is if you’re specifically looking for either a 30-month or longer CD or a money market account. These accounts are undoubtedly the strongest offers from State Farm, at least in terms of interest rates. But when it comes to standard checking and savings accounts, the bank leaves a bit to be desired.

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