About Ken Tumin

Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

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Internet Banks and Living Without Paper Bank Documents

One concern people have with internet banks is the lack of paper documentation. When you open an account at a brick-and-mortar bank, you’ll likely receive a paper document showing that you have opened the account. When you make deposits at a local office, you’ll receive a paper receipt showing the deposit into your account.

With internet banks, you may not receive the paper documents that you’ve grown used to at brick-and-mortar banks. One reader commented about the new GE Capital Bank. The account opening process went well, but he was dismayed to learn that he won’t receive any paper proof of deposits. It is common for internet banks to provide no paper receipts for deposits. However, when accounts are opened, many internet banks do mail paper confirmation letters. I have received confirmation letters at both Ally Bank and Discover Bank showing my initial deposit, interest rate, account number and other account information. Once the account is opened, you typically won’t receive letters confirming deposits.

One method that I use to confirm deposits at internet banks is to record the confirmation numbers when I initiate transfers. Most all of my deposits are done by initiating a bank-to-bank ACH transfer. When you submit the ACH transfer request, the bank should provide a confirmation page with a confirmation number or transaction number. I record that number, the time and the amount of the transfer. This confirmation page can also be saved or printed out. If there are any mistakes, I can use that information to ensure the mistakes are fixed. I have never experienced mistakes or problems with ACH transfers so I’m not aware of potential complications. If you have experienced problems with ACH transfers, how did you resolve the problem? And how easy was it to get the problem resolved?

With internet banks, you can monitor accounts daily to ensure deposits and withdrawals are properly made, and to make sure there are no fraudulent withdrawals. Most internet banks allow you to set up notification alerts to email you when certain transactions take place or when your account balances reach certain levels. This makes it easy to closely monitor your bank account.

Many internet banks will mail you paper statements unless you choose to only receive electronic statements. I now prefer electronic statements over paper statements. Instead of printing them out and wasting ink and paper, I just save the e-statements to a USB flash drive.

Is the lack of paper documentation at internet banks a major issue for you? If you have accounts at internet banks, what methods do you use to ensure your accounts are free of mistakes and fraudulent transactions?

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  |     |   Comment #2
This is only an issue if you have no ability to use a computer. I find having fewer paper documents containing personal info a big plus. Less paper to run thru the shredding machine.
  |     |   Comment #3
Virtually all Internet banks will at least supply a confirmation letter upon opening AND whenever the CD is renewed (showing the Principal), APY, owvers(title) any ITF/POD info etc.  Sometimes you have to call and ask (or at least speak up upon opening/renewing that you will receive such cinfirmation of facts on REAL letterhead etc.  If you don't get it, be more stern, you are entitled, although some banks provide think in PDF format, but customized with your account data etc.  99% of bank/CU's do provide either monthly, quarterly or sometimes annual CD account statements...call and ask...it's your money.  The only bank so far which has not ever provided a real (even annual statement of CD status) is EVERBANK, altough the data is avaialble online.  The only paper form I get mailed to me is an annual 1099. 
  |     |   Comment #4
I always insist upon a paper copy of everything.  Computers are not dependable.  How many times have I been to a bank etc. or called them only to be told their computers were "down" or they were having problems bringing the info up so they could check out something for me.  Computers should only be for a backup.  When push comes to shove, that paper document cannot be disputed.  If everything being electronic is so great why do I still have banks which insist I have to return the Original paper CD form in order to get my funds back at maturity.  Why can't they just bring up my account on the computer?? 
  |     |   Comment #5
.  If everything being electronic is so great why do I still have banks which insist I have to return the Original paper CD form in order to get my funds back at maturity.  Why can't they just bring up my account on the computer?? "

I've been banking online for over 20 yrs with a dozen assorted banks and have never had a bank request me to return the original paper CD in order to redeem at maturity. Which bank(s) are you referring to?
  |     |   Comment #6
This is just one of the many banks we use and it is in our city.  It happens to be their own particular policy. In all my years of purchasing CDs it is the only one which insists on the Original back.  It is not a well known national bank so not one you are probably using.
  |     |   Comment #7
Paper is mostly useless at a bank. You can present a bank with any document you like but if they can't find a corresponding presence in their computer system then you're unlikely to get anywhere with them except in court. An actual CD can be a bit different (from a policy and regulations perspective) and treated as a bearer document, which is why some banks insist on its return. This is also why some banks issue a "Time Deposit" rather than a CD, or in the Terms and Conditions they point out how they'll retain the actual CD and instead mail you a copy or receipt for the actual CD.
  |     |   Comment #8
#7  May I ask, what bank(s)  treat a CD "as a bearer document"?
  |     |   Comment #9
I read this on a site which I found informative:

"Although banks no longer issue certificates when CDs are opened, some multi-year CDs on which certificates were issued, are still in existence. To close such an account you must provide the bank with the certificate you were given at account opening, and a valid form of ID. Technically, the bank cannot redeem the CD if you fail to produce the certificate. In reality, every bank has some kind of back-up records and the bank should allow you to close the account even if you have lost the certificate."

So I guess it is left up to the bank.  Most banks I use want me to bring back at least a copy of the CD but only one insists on the Original.  It is just a local bank so maybe it has it's own reasons for this.
  |     |   Comment #10
I do not deny that some banks have or currently do issue certificates when opening CDs. 

My prior post was asking what bank(s) treat a CD certificate "as a bearer document" as stated by

poster #7?
  |     |   Comment #11
Commenter #3 said he actually got a paper year-end 1099-int from Everbank.  I'm glad to know that; because if I close my account there I might then have no way of knowing how much interest they are reporting to IRS for 2013.

Caution to anyone who uses U.S. Treasury Direct -- they are ruthlessly paper-free.  They never send you any paper documents, not even a 1099-int.  So you must take care to get that info from your account webpage on their website.  And if you die, then your estate representative who files your tax return will need to know your account number and password to get into your webpage and find that info.
  |     |   Comment #12
I make copies of every document, you can not rely on the workers at the bank for any info. The tellers work for minimum wage and have very little schooling or knowledge about any problem you bring at them. They always call a supervisor, who calls a manager who calls a branch operation assistant who calls main office who has no idea what you are asking or talking about. Case in point Wells Fargo Bank, just try to dispute something then come here and post when that issue has been resolved, if ever.
  |     |   Comment #13
The problem with bank employees is that they're trying to enfore the bank's policies and at the same time the laws of the land.  They are not lawyers.  What a bank employee states may or may not be legal.  If you believe something is "wrong" talk to a lawyer.  Get the correct answer.

PS.  I am not a lawyer.
  |     |   Comment #14
Given all the mergers and acquisitions involving financial institutions these days, what good is a piece of paper from a bank that doesn't exist any more? Account numbers have been changed at least once or more. I just "trust and verify" by keeping copies of my original deposit, periodic balances and ACH confirmation numbers. If something goes haywire the FDIC or NCUA can always find the records and sort it out. I do keep paper statements for my core checking account, which is at a local brick-and-mortar bank, where all my direct deposit earnings go, and my monthly bills are automatically paid-out. Old habits never die.
  |     |   Comment #15
I do not place the bulk of my assests to financial institutions that don't send a paper statements because of the possibility that I could become incapacitated at any time.  For those that never send anything (not even Form 1099-INT) like ING Direct, I just sign onto the website off and on to monitor the balance.  I have never encountered an ACH or balance issue at any internet based banks.  My brokerage account and HSA are also mailed statement free, but I do get a year end mailed tax statements from them.
  |     |   Comment #16
> Most internet banks allow you to set up notification alerts to email
> you when certain transactions take place . . .
What I would really like is a notification/alert when the rate
on my (eg., savings) account changes; I know of no bank providing
this.  (Most seem to actually hide it!)  Anybody aware of any
one providing rate change notification alerts?
  |     |   Comment #17
#16  Are you referring to rate changes for the regular savings account you have at a local bank or for other types of savings.  My rate is so low, if it got any lower I would not even get my 6 cents interest!  I use this account for other reasons and am not concerned about the interest rate.  I know there are sites that will let you sign up for rate changes for CD rates so one can know where to find the highest rates.  (That should be a joke since there are no "high" CD rates these days.)  I am confused as to what kind of rate changes you are referring to.
  |     |   Comment #18
BTW, I forgot to add, did you know Ken has a way we can sign up on DA to Receive Alerts When Your Bank or Credit Union changes Rates?  You just have to fill in the bank's name.  Maybe that will give you what you are looking for. 
  |     |   Comment #19

You exposed the grand scheme to reduce the national debt.  The banks will have all our bank accounts non-traceable and turn everything over to the treasury.  No more national debt!
  |     |   Comment #20
Re: paoli2 #17 #18

I am referring to deposit rates on Savings, Money market and
Checking accounts.  Since they seemingly easily automate other
account notification changes, I would like to see immediate
notification when (one of the most important attributes
associated with the account) the rate changes.

I utilize Ken's most use useful DA rate alert system wherever
possible but it does lag 24/48 hours after a rate change.  Also
not all financial institutions (eg. local banks) are tracked in
the DA alert system.

This seems such a basic and fundamental item of customer concern
and use, yet I know of no one that provides it!
  |     |   Comment #21
Re: Anonymous - #19, Friday, August 23, 2013 - 8:17 PM

It doesn't matter what kind of account you have. Unless you have all your funds in a fire-proof safe at home, drawing zero interest, they could press a button and do that at any time. Of course the financial world, as we know it, would end about 30 seconds later so there would be no point in doing that.
  |     |   Comment #22
A few years ago, I learned the value of old-fashioned paper statements when I became the executor of my sister's estate.  She had died unexpectedly, and her banking records could not be located.  I was able to find her assets by watching her incoming mail, looking for statements from banks, brokerages, and so on.  If she had any accounts that provided electronic statements only, I never found them.  As a result of this experience, I do not bank with any institution that does not provide regular paper statements.  (Once-a-year 1099s are not enough; if my house burns down with me in it, my heirs can't wait a year for the next tax form to show up.)
  |     |   Comment #23
#22   Your experience with your deceased sister's accounts makes a good point for paper documents.  Even if they were on-line, you would have to know her password and how she accesses the account to get into it.  I was surprised to learn from my DP's brokerage that I was not allowed to access his account unless he was sitting there actually typing in the password and with me.  Sooo if they are deceased are we supposed to have a seance to bring back their spirits just so we can get the info we need?  I will always insist on paper backup for everything! 
  |     |   Comment #24

You stated:  "I was surprised to learn from my DP's brokerage that I was not allowed to access his account unless he was sitting there actually typing in the password and with me".

Now how is the brokerage firm going to know if your DP was typing the password or you were?
  |     |   Comment #25
Yep!  I asked them if they put video cameras in all customer apartments or homes and told them what a stupid rule that was.  Their reply was they were going on "trust" with their customers.  So now I am so filled with guilt, I drag DP from his 24 hour nap and I taught him to actually type in his password and ID so that he could go back to sleep while I monitor the account for him.  You men have it sooo easy!
  |     |   Comment #26
paoli2 #25,  Who said what my gender is? 

Since you "always" abide by the broker's rules and since they can see the computer, you may need to have a durable Power of Attorney if you see the need.
  |     |   Comment #27
#26  Thanks for caring but I assure you I do have the Durable Power of Attorney and all the correct and needed documents I need for "just in case".  Maybe that's the brokerage's way of making guys stay awake for at least part of the day.  :)
  |     |   Comment #28

Then why do you need to drag your DP from his "24 hour nap" if you have a POA?  Let him rest.
  |     |   Comment #29
"let him rest"???  I can't tell him the POA gets me off the hook.  Besides, if I were that nice to him he would really get worried about me.  I need to see he gets his exercise.  So many times I pretend I need to check out his account just to get him up. You have to realize, I am not really "Paoli".  To him, I am this really nice person who takes care of him.   BTW, I didn't realize the POA gives me permission to override the brokerage's stupid rules.  Are you serious about that?  Thanks.
  |     |   Comment #30
'A few years ago, I learned the value of old-fashioned paper statements when I became the executor of my sister's estate.  She had died unexpectedly, and her banking records could not be located.  I was able to find her assets by watching her incoming mail, looking for statements from banks, brokerages, and so on.'

The problem there was your sister not notifying children, heirs, siblings etc, where the password and pin combos to her accounts could be found in case of her sudden death. Most people make sure that the people they intend to leave their assets to are fully informed on where to find the relevant info. For people like your sister and others like her, not doing so is a problem.
  |     |   Comment #31
paoli:  My POA has a clause that states "whatever act ......as long as in best interest of" and so on.  But did you fill out the brokerage's POA version for the account and file it with them? 

Many firms have their own version of a POA and may not accept one from an Attorney.  Many banks are the same way. 

As a disclaimer, I am not an attorney, nor am I giving any legal advise.  I'm  just a person who said what I did. 
  |     |   Comment #32
#31  No but you bring up a good point.  I may call our brokerages next week and ask them if our POA allows me to monitor his accounts over the computer.  I thought POAs were for taking action when the other party can't but in our case, he is well and able to monitor his accounts, he just would not understand what he was looking at the way I do.  So in our case, I don't think the POA covers what I want to do.  We'll see.

#30  Did you miss the part in the post that said his sister had an "unexpected" death?.  We have no idea how old she was and maybe it never occured to her she would be taken unexpectedly.  It is hard enough to get seniors to take care of these matter much less younger people.  His sister is a good example that you are never too young to take care of such matters for your family's sake.
  |     |   Comment #33
#32, Her age is irrelevant! If she was invested in multiple bank and brokerage accounts I doubt she was a financially unsophisticated person. If she cared about seeing that her assets went to certain family members upon her death, and any mature person knows death can come at any time from any cause, she should have made sure the right party knew where to find the needed info.
  |     |   Comment #34
#33 You are right and you are a perfect example of the stress and problems one must go through when a relative does not take care of these matters ahead of time.  In a perfect world, they would but I would be willing to bet there are many other relatives out there who have not done what should be done.  Maybe they can read your post and know why it is so important to do it "now"! I can assure you I was not trying to downplay what was caused by your sister's inactions or make excuses for her. 

  |     |   Comment #35
Regarding the statement in Ken's article above:

"I now prefer electronic statements over paper statements. Instead of printing them out and wasting ink and paper, I just save the e-statements to a USB flash drive."

I would strongly advise that the data on any USB flash drive be backed up just like one would/should do with either an internal or external hard drive.

Over the past year or so I've had several USB flash drives cease to function, without any warning or gradual deterioration whatsoever.  And unlike hard drives, where some or all the data on a failed drive may sometimes be recoverable, my understanding is that recovering data from a failed USB flash drive is just not possible/feasible.

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