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Reward Checking Mentioned As One Way Savers Can Fight Back

Wednesday, October 6, 2010 - 5:36 PM
Scott Burns is one of the nation's top personal finance newspaper columnist. He has also been a strong advocate against the monetary policy that helps the banks and the debtors at the expense of the savers. He describes more of the savers' plight in his latest column:
But the banks are paying next to nothing on deposits. This makes them more profitable and less likely to need more money from Washington because they are taking it out of depositor’s pockets. The big banks rebuild while savers quietly go broke.

His recommendation is to move your money from the large banks that are paying practically nothing on deposits to the small banks that offer reward checking accounts. He doesn't go into details about the complications of the these accounts (i.e. small balance caps, falling rates). Nevertheless, reward checking accounts make a lot more sense than leaving your money in a checking or savings account at the megabanks.

Here's an interesting comparison that he gave. A $10K deposit at one of the banks that pay 4.26% returns $426 in a year. To get that much interest at Bank of America, Chase or Wells Fargo (which pay 0.05% on their checking accounts), a balance of $852,000 would be required.
Ken TuminKen Tumin5,472 posts since
Nov 29, 2009
Rep Points: 125,708
1. Wednesday, October 6, 2010 - 8:42 PM
This article is late by three years:-)

For Scott Burns: it is not difficult to know that it (4.26%, $10K) is Founders Bank (TX) you were talking about.  You can go to Texas Citizens Bank to get (5.01%, $25K).  Do not be settled with just 4%:D
51hh51hh1,476 posts since
Jan 16, 2010
Rep Points: 6,427
2. Thursday, October 7, 2010 - 2:47 AM
The article still makes sense if you have $35000 to invest  i.e $10k at Founders and $25k at TXCB.

BTW FOUNDER'S is too fussy about small withdrawals and you are never sure if they will disqualify your transactions.
adityanmadityanm25 posts since
Jun 5, 2010
Rep Points: 158