Are all banks similar? If you believe so, it's time to delve deeper. With over 10,000 banks in the U.S., each provides unique services, branch locations, fees, and interest rates.

Although many opt for a handful of megabanks, selecting one of these major institutions may mean missing out on benefits like high deposit rates, lower fees, personalized services, and more.

Given the multitude of choices, understanding the various bank types can help narrow down your decision.

Central banks are crucial for regulating national economies by influencing money supply and borrowing costs. Commercial banks like JPMorgan Chase and Wells Fargo target profitability through services for individual and small business customers. National banks, such as 1st National Bank, are federally regulated and operate nationwide. Regional banks, with assets of $10 billion to $100 billion, are community-oriented and offer various services. Community banks, with assets under $10 billion, focus on localized services and can cater to individual needs.

Investment banks mainly serve large businesses, while online banks offer digital-only services with competitive rates and low fees. Neobanks, partnerships with chartered banks, provide tech-forward services and are attractive for those with limited banking options. Savings and loan associations specialize in mortgage loans and savings accounts.

Credit unions, as nonprofit institutions, offer similar services to banks but with lower fees and higher interest rates. However, membership requirements may apply based on location or occupation.

Choose the right bank by considering factors like location, preferred banking method, needed services, community support, financial priorities, credit history, and meeting credit union membership criteria. Opting for smaller institutions may offer competitive rates, online services, and accessible ATMs aligned with individual needs.