Tag Archives: banking

Managing Money

5 Things To Evaluate When Selecting A Bank

Leave a comment

Do you remember your first bank account? Mine was when I was 8 years old. My parents gave me an allowance but I had to put $5 away each week into a savings account. This was back in the 60’s and, at the time, it was a local bank.

rich piggy

frankieleon via Compfight

Times have changed and selecting a bank isn’t as easy anymore. Each bank has benefits and negatives about it. If you don’t want to feel like you’re being taken advantage of, you need to take more time evaluating banks and determining which one fits your needs the best before you go putting your money in one.

Here are 5 things you should evaluate banks on based on your circumstances.
Continue reading 5 Things To Evaluate When Selecting A Bank →

Managing Money

Dangers Of Creating Joint Accounts

Almost every organization, business and regular people rely on their checking accounts. Most of them end up having someone else have access to those account for one reason or another.

Kai Pilger from Pixabay

For businesses and organizations, the idea is to have more than one person who can sign for things in case of an emergency. Sometimes it’s to have a second person sign before certain dollar amounts can be approved or allowed to be paid.
Continue reading Dangers Of Creating Joint Accounts →

Managing Money

Set Up Automated Payments Through Your Bank

In the movie The Secret, one of the philosophers, Bob Proctor, stated that instead of worrying about debt we should all start thinking about how we can improve and grow our income. His suggestion was to set up payments to automatically go out from our banks, make sure the money is in our accounts, then never think about it again.

The City
Creative Commons License chillilogic.com via Compfight

While part of that is a bit scary, the part about not thinking about it, there might be something to setting up some payments to automatically go out from our banks to certain creditors. Let’s think about why we might do this.

These days, more companies are charging us for paper statements, trying to get all of us to set our billing up electronically. Sure, it saves them money, and we might get our bills sooner, but if you’re like me as it pertains to email you probably see it when it first comes in and then forget about it. Even those of us who have an idea of when our payments are due can easily miss a date because of this.

This is where setting up your account to pay some of your bills electronically might be a major benefit. Unlike the old days where it could take up to a week or more for payments to transfer, these days most payments actually show up in your creditor’s account on the same day your bank sends it. The longest you might have to deal with it is a couple of days, for which I don’t know a single creditor that’s true for, but I’ve heard that there are some that take a day to process your payments.

The negative is if your money situation is unstable, which means you’re not always sure that your money will be in your account. That and the worries about banking in places where your online access isn’t as secure as it might be at home could put you in a precarious position. Overall though, this is an efficient way to make sure your bills are paid if you don’t have any worries about money and don’t need to access your account too often when you’re not at home.

Because you’re doing it through your bank, the only thing they usually need from you is the name and account number of the institution you wish to be paid. After that, you select how much is paid and on what date and that’s pretty much it; you’re good to go. You can change either the amount or date whenever you want to; it’s pretty simple to do.

You could also set up payment arrangements directly with your creditor, but doing it through your own bank gives you more control over the process. Either way, it’s something to consider.

Finances

Is Your Money Safe In A Bank?

Within the last 24 hours, there have been two stories that are causing the world markets to shudder.

The first involves Greece, which shut down its banks for six days to help them get a handle on their economy, as they’re about to default on their debt payments and could possibly be thrown out of the enrozone exchange.

looking up in Singapore
Jim via Compfight

The second involves Puerto Rico, which announced that it can’t pay its $72 billion debt. This one definitely hits closer to home since Puerto Rico is in essence part of the United States.

When we read about things like this, it makes us question our own economy and wonder just how safe our money is, especially the money that’s sitting in the bank. After all, if a country can shut down its banks, what do we do when we can’t access our money besides write checks and use credit cards?

This was a big issue back in the Depression era. Banks shut down and even the richest clients didn’t have access to their money. For many of them, the money no longer existed, and many people were suddenly broke.

That led to the passage of the Banking Act of 1933, which launched the FDIC, or the Federal Deposit Insurance Corporation. Its purpose was to offer insurance for banks by guaranteeing them access to at least $250,000 per bank within an organization. This means that if a banking system has 10 locations, each bank has at least that much for its consumers.

The FDIC protects around 6,700 institutions throughout the country, and because of them no depositor has lost money since the program began. Even banks that fail, which leads the federal government to take them over and try to find new owners, are granted enough money to protect consumers actual funds. This relieves a lot of stress on those of us with checking or savings accounts.

Not only that, but if you have invested in a bank plan that helps you grow your money, that’s protected as well under its own plan. So, if you have $250,000 in savings and another $100,000 in investments, you’re covered for all of it. However, if you have multiple checking accounts (which some businesses have), they would all be combined and only $250,000 would be guaranteed.

So, it’s not perfect, but it’s better than the alternative of not having access to your money at all.