The latest news out about the banking industry shows that they are still losing money on bad investments and the fallout from a poor economy. It seems ironic that increasing fees has not stemmed the tide. Next, we might see a fee on such things as walking into the lobby of your local branch. Indeed, some banks are charging for the use of a live teller at local branches in the form of transaction fees.
With the stock market on an upward trend, banks are not yet recovering because they are a lagging indicator, not a leading one. So, their approach is to try to hang on until an improved economy reaches their door step.
Meanwhile the number of failed banks is growing which puts pressure on the FDIC. Not to fear, though, the FDIC reports that they have enough money to ride out this storm and protect your hard-earned cash. As consumers, this underscores the point about protecting what you have, and learning how to be better money managers.
Here are some tips that will do just that:
Consider Online Banks
Many people are still not ready to do business with banks that are solely in the online realm. But, consider that these banks are performing better than the brick and mortar banks down the street. The reason is because they do not have as much investment in physical structures as do the other banks. Also, payroll is lower because many things are automated and do not require a “live” person to perform.
Is online banking for everyone? The answer is ‘no’, but it might be wise to consider opening up an account in addition to your traditional account at your local branch. Rates are generally better and fees are lower. In short, you keep more of your own money.
Look at Credit Unions
The darling of the banking industry right now appears to be credit unions. They, too, are known for lower fees and better earnings on your money. Customer service is their forte, too, leaving many of their real bank counterparts grasping for air. Your money is federally insured through the NCUA and you have almost as many options as you do at a traditional bank. It just makes sense to check one out near you and it might be the better alternative to an online bank.
Close Unused Accounts
Almost everyone has an unused bank account somewhere. There it sits, with almost no money in it. You might be charged a minimum balance penalty, too, if your account balance is not high enough. If that is the case, get your money out of there and put it into a savings account where it can earn some interest.
Multiple Accounts at the Same Bank
Most financial institutions offer some sort of incentive to having more than one type of account with them. If this is the case with your bank, take advantage of it. The other benefit of this is that you can transfer money between accounts at will. It is a good way of actively managing your cash flow.
Pay Bills Through Your Bank
Online banking with your local bank makes sense when you use the online bill paying option. You save money by not having to purchase stamps. Also, you save time by not having to visit multiple websites just to make payments to each of your creditors. The only things that are worthy of paying with a real check now are basic utilities such as electric, gas and water. Should you be cut off from those because of an online banking problem, it could have serious consequences.
Keeping more of your money is a reality if you use common sense steps like those provided here.