Dedicated to bringing you some of the best information to help you survive tough economic times
January 2011 - Posts
by Ken Tumin
The past two years have been especially tough for savers and retirees who live off interest from their bank accounts. Interest rates have been at record lows. There were a few bright spots for savers in 2010, such as the FDIC $250K deposit insurance coverage limit becoming permanent and improvements in technology that made banking more convenient.
The best case for savers in 2011 is for economic growth that leads to higher interest rates but without causing excessive inflation. Savers also hope they don't become collateral damage from bank regulations that were passed in 2010. Overdraft and debit card regulations will hurt bank profits in 2011. The worry for savers is that banks will make up for this loss by adding new account fees and fewer account perks.
Here are some predictions on banking and deposit accounts for this year:
1) Interest Rates Will Stay Low
Savings account rates and short-term CD rates will likely stay low in 2011 as the Fed continues its monetary policy while it waits for improvements in the economy and unemployment. This will force short-term interest rates to remain very low. However, signs of growth have recently pushed up long-term interest rates for mortgage rates and Treasury yields. This will likely continue in 2011 and may spill over to long-term CD rates.
2) Free Checking Becomes Harder to Find
The large banks must make up for the revenue they are losing from the new regulations. Several banks have already announced changes to their free checking accounts. Customers may still be able to avoid monthly fees, but the new bank conditions will require larger balances and/or specific activities like direct deposit.
3) Debit Card Reward Programs Suffer
Large banks will be affected by the Fed's caps on debit card interchange fees in 2011. Many banks offer debit card reward programs, which provide checking account customers with various perks for debit card use. Large banks will reduce or eliminate these programs when the new regulation takes effect.
4) High-Yield Reward Checking Growth Slows
Over the last two years, hundreds of community banks and credit unions launched reward checking accounts with higher rates than internet savings accounts. The high rates were possible thanks to debit card interchange fees. With the Fed's proposed caps on these fees, banks and credit unions reduce or discontinue reward checking accounts.
5) New Bank Products from Bank-Like Companies
More companies will partner with banks in 2011 to offer new bank products. Companies like BancVue, PerkStreet Financial and SmartyPig have grown in 2010 by providing innovative banking products. This growth should continue, and it should spur new companies to launch new Internet-based bank products and services.
6) Remote Deposit Capture Grows in Popularity
More banks will allow customers to deposit checks from home by using home PCs and scanners or from their smart phones. In 2010, Internet banks and megabanks launched these services and this could increase as Internet banks use remote deposit to compete with the megabanks.
7) Fewer Bank Failures
Bank failures peaked at 157 banks failures in 2010, but the number of failures dropped in the last quarter of 2010. The FDIC predicts fewer bank closures in 2011.
8) Bank Failures Continue to Hurt Savers
The FDIC has done its job at protecting all insured deposits and no depositors have lost any insured deposits in bank failures. However, many depositors at failed banks have lost high interest rates on their CDs because the acquiring bank is allowed to reduce rates on existing CDs. Many banks did that in 2010, and many will likely continue this in 2011.DepositAccounts.com provides the most comprehensive listings of rates of all types of deposit products from banks and credit unions without influence from advertisers. Deposit products listed include reward checking accounts that few other sites include. In addition to rate comparisons, DepositAccounts.com provides several services to help readers in their banking decisions such as listings of bank health ratings, a blog and a discussion forum.
Ken Tumin, the primary blogger for the site, is the top blogger on the web for finding and reviewing the best bank and credit union deals. The blog has been noted in bank related articles by the
Wall Street Journal,
New York Times,
USA Today and other major news organizations.
by Bill Hardekopf
Here is an easy New Year's resolution that may save you over $100 in 2011: pay attention to the notices and fine print from your bank. Fees are rising with many major banks, and there may be more you have to do to get or keep a free checking account.
When Congress passed regulations on the financial industry, banks warned the restrictions would cause them to raise rates and fees to recover the lost revenue. Banks have proved many times they weren't bluffing. Banks have added a number of new fees in the past two years, and now they are testing fees on checking accounts, something that could affect millions of consumers by the end of 2011.
Banks could lose billions of dollars in revenue this year from regulations. Banks can't just absorb that loss; they have to make it up somewhere and checking accounts are the hot topic right now.
Free checking was a nice gift that banks used to attract customers, hoping it would lead to a deeper banking relationship with loans, mortgages, credit card, and mutual funds. But free checking is not "sacred." Some banks started adding new checking account fees last year and a number of banks have followed.
Bank of America
Bank of America is testing a new fee system. It will divide customers into four groups and charge monthly fees based on how much money and how many accounts a customer has with the bank. The fees could range from $6 to $25 a month, but customers can avoid the fees if they maintain a certain minimum balance, make a minimum number of deposits (both determined by account level), or bank in certain ways such as linking multiple accounts and credit cards.
Starting February 8, Chase will enroll new customers in Total Checking. The monthly fee is $12, but it can be waived if you maintain a $1,500 balance, make $500 in monthly direct deposits, or keep a $5,000 balance across your deposit accounts. Older accounts will get a $6 monthly fee that can be waived with $500 in monthly deposits or if you make five debit card purchases.
Chase is also increasing fees on some account activities. According to the Chicago Tribune, ATM and debit card withdrawals at non-Chase ATMs will cost $5, up from $2. It will also charge $1 to print recent account transactions at ATMs for most customers. Overdraft protection fees are rising from $10 a day to $12 (waived if the account is overdrawn by $5 or less). The insufficient funds fee is increasing from $10 to $12. Outing wire transfers will cost $30, an increase from $25. Online transfers jump from $20 to $25. Stopped payment requests increase from $32 to $34.
Last fall, Citi started charging monthly maintenance fees. The basic checking account now has an $8 monthly fee that is waived after a minimum of five transactions each month. A higher level account charges $20 each month if you don't maintain a $6,000 balance across all linked checking, savings and investment accounts.
Starting February 3, Wells Fargo will replace free checking with an account that charges a $5 monthly maintenance fee and a $6.95 monthly online bill pay fee. This is for new customers and fees can be waived if a minimum balance or other requirements are met.
Here are a few consumer tips on avoiding or minimizing new bank fees:
- If you have an account requiring a minimum number of deposits or balance amount, pay close attention to your statements. Use account alerts to notify you of deposits, payments and account balances. For example, if your minimum balance requirement is $500, an online alert can notify you when your balance drops close to that so you can take action before you get hit with the fee.
- Keep up with monthly debit card transactions. Some banks are adding fees if you don't use your debit card enough.
- Find out what activities will waive your monthly maintenance fee. Banks may waive the fee for online banking, a certain number of deposits, or more debit card usage.
- Check out your local credit union. These may have better rates and lower fees than the major banks.
- Contact your bank customer service. You can complain about the fees and even ask them to waive the fees charged to your account. Keep an eye on your monthly statement for strange or new fees.
- Know yourself and how you use your account. Is it difficult to keep a $500 minimum balance? How often do you use an ATM? Do you need the monthly copy of your cancelled checks? Know how you use your checking account and then find a bank that gives you the best rate and lowest fees for those services.
- If you didn't opt out of overdraft protection, contact your bank and opt out now. Banks are still promoting its benefits, but this protection can be very costly to you should you overdraw your account.
Bill Hardekopf is CEO of LowCards.com, a site that simplifies the confusion of shopping for credit cards. It is a free, independent website that helps consumers easily compare credit cards in a variety of categories, such as lowest rates, rewards, rebates, balance transfers and lowest introductory rates. It also gives an unbiased ranking and review for each card. The LowCards.com Complete Credit Card Index is the most objective and comprehensive resource on the Internet, which allows consumers to compare rates for over 1000 credit cards offered in this country.
by Leanne Ely, C.N.C.
Dirty dining reports are becoming quite popular with local news stations all around the country and are grossing out America at the same time. I'm sure you've seen it before; local reporters go into the kitchens of restaurants to see what health code violations they can find. I'll spare you the gory details, but it's usually one more reason I prefer to cook my meals at home.
But let me ask you-- how would your kitchen stand up to one of these inspections? I like to keep my sink shiny (thanks to FlyLady) and my pantry neat (thank you Rubbermaid), but as you may have seen in my pantry makeover blog just about a year ago, I found an old sprouting potato hiding in the dark recesses of my pantry. It happens!
So how safe is your kitchen? When is the last time you gave your fridge and freezer a good disinfecting? How old is the shelf liner in your cabinets? Are there crumbs in your flatware drawer? What's hiding on your cutting board, under your stove, or behind the fridge?
There are some great inexpensive basic household cleaners you can use to get your kitchen sink (and everything else) shiny and safe.
Sanitize & Disinfect
Keep surfaces, counters, cabinets, appliances, floors and your fridge clean with plain old household vinegar. I like plain old white vinegar. It is effective at preventing bacteria growth. For your counters, just put straight vinegar into a bottle and spray directly on the counters. Wash with a wet cloth that you rinse often in hot water. If you let the vinegar sit on the counters a bit, it will help further sanitize. You can use this product safely on any surface and it's inexpensive, does not pollute the environment and there is no risk of chemical exposure like with bleach. You may want to dilute a little for floors. Always pay attention to cracks and crevices because that is where bacteria can hide and thrive. Use an old tooth brush to get to those hard to reach spaces.
Store your food in only BPA free containers. I recommend Rubbermaid for a multitude of reasons. By putting your dry ingredients like rice, flour, cereals, mixes, etc. in containers with sealable tops, you keep them fresher longer and prevent infestations from critters hitching a ride home from the supermarket (like wevils or roaches, ewww!). Keep food off the floor by installing shelves in your pantry. By using shelving and keeping your food in sealed containers, you will shun the creepy crawlies that want to get in!
Most cooked food does not last very long in the fridge, 2, 3 days, 4 days, tops. If you are not sure that you are going to eat it right away and want to avoid waste, freeze leftovers in single serving freezer safe containers. This can be handy when you are in a rush or even if you have unexpected guests and need to add a serving to your meals. Make sure you mark what is in your containers with a Sharpie or other marker and don't forget to date it.
Create a cleaning schedule that the whole family can follow. Schedule tasks like cleaning the oven, going behind the fridge, and giving each cupboard a wipe down throughout the year so it is not such an overwhelming task. Certain maintenance cleaning tasks can be done daily, weekly, monthly, and yearly. Decide what works best for your family and then schedule them out. With the New Year approaching, now is a great time to get these things on the calendar for next year.
Remember, it is much easier to keep things clean than to let them get out of control. You can actually save time keeping this task up and the whole family will benefit from food prepared in a safe and clean kitchen.Leanne Ely is a
New York Times best selling author of
Body Clutter and the popular Saving Dinner
cookbook series. According to Woman’s Day Magazine, she is the expert on family cooking.Leanne's syndicated newspaper column, The Dinner Diva can be found in 250 newspapers nationwide and in Canada. Her vast broadcast experience includes media satellite tours, QVC several times as well as guesting on several national television shows, including HGTV’s
Simple Solutions, ABC Family’s
Living the Life, Ivanhoe’s
Small Talk for Parents and
Talk of the Town. She has guest chef-ed on the cooking show,
Carolina Cooks and has taught cooking classes all over the country for Bloomingdale’s.
In addition, she is a seasoned radio personality. Leanne’s own radio show, Heart of A Woman aired during drive time in two major California markets, Los Angeles and San Diego. Her current show, The Dinner Diva is one of the top Blog Talk Radio shows on the Internet.On the Internet, she pens the Food for Thought column for the immensely popular, FlyLady.net, with over half a million readers weekly. She has been featured in
Woman’s Day magazine, the
St. Petersburg Times,
Orange County Register—to name a few. Additionally, she is a sought after speaker and has spoken all over the country, with keynote addresses to corporate and non-profit entities.
Visit SavingDinner.com today!
by Sarah Simpson
The retail environment has changed significantly over the course of the past decade. It wasn't too long ago that online retailers and the concept of making purchases online was introduced to consumers.
Today, just about all stores you shop at, even some supermarkets, have their entire product selection available online, and will ship your purchases to your house.
What is the benefit to shopping online as opposed to in store? Can you actually save money and find more bargains by doing so?
Shopping and bargain hunting go hand in hand. What once would take a lot of time and travel between competing retailers comparing prices of similar items can now be done in an afternoon.
There are many online retail sites that will offer comparison prices on a number of products, even providing consumer ratings on how real life buyers felt about their purchase.
Being able to compare products and prices through hundreds of retailers really puts the advantage into the hands of the consumer. In addition to hunting for the best price on a given item, shopping online has created a market for online coupons, often in the form of coupon codes.
Coupon codes are promotional codes that can be entered into the point of sale on a merchant's website. These are simple to come across and can often be obtained for free just by doing a search for that retailer.
Retailers that do not participate in such free promotional code programs often have coupons for sale on various auction sites. All these tips are excellent tools to use when hunting for the best bargain.
Selection and Shipping
Another benefit to shopping online is that you are less likely to be disappointed by an item you are shopping for being out of stock. When you shop at your local department store, pharmacy or other retailer, you are limited to what that location has in stock.
Buying online, you are able to purchase product from a much larger inventory, often on an international scale. Shipping is another way that shopping online can provide you with more bargains than shopping in store.
Several companies offer discounted and even free shipping on items based on the quantity you buy. This can save you money on the gas it would take you to travel to the local store to make your purchases. Just another way shopping online can save you money.
There are numerous ways that online shopping can benefit you. Saving time and money are just two, albeit significant reasons to consider shopping online as opposed to in store. Be sure you take advantage of the tools available to you for comparing and pricing before you make a purchase, and be sure to apply any coupon codes that you may find to enhance your bargains.
Sarah Simpson loves shopping! But she also likes to make sure that she’s truly picking up a bargain! She currently operates Offer UK, which lists a wide range of discounts and coupon codes, including Dixons discount codes and those offered by other leading retailers.
by Elias Cortez
Chase banks, like many others, are no longer offering the "free checking" they advertise. While it is still called that, users are new receiving updates regarding hidden fees for nearly every transaction. While we are all accustomed to ATM withdraw fees for ATMs from a different bank, banks like Chase are now raising those fees from the typical $2-$3 to $5 for each transaction. If your bank account is linked to any garnishing of wages, or other legal action, you are charged over $100 for each action. Additionally, if you do not have direct deposit each month or maintain a balance of $1600 in your checking account, you have to pay a monthly fee to the bank.
Before, you could deposit a check from someone else into your account, and if it bounced due to insufficient funds, they received a penalty while the bank stuck it out, but you received your funds. Now, you are being punished as well with a $12 fee for any check which you deposit that bounces, whether it’s yours or not. So being able to stretch your dollar and balance your budget no longer applies. It’s like having your car insurance raised because other drivers are unsafe.
It used to be that your only penalties were for ATM withdraws from another ATM and for overdraft if you lacked overdraft protection. If you have overdraft protection—that is, they take funds from a linked savings account to cover any overdraft from a checking—then you likely paid for that too. Banks are no longer able to make money by charging for higher credit cards fees and have turned their thoughts on consumers now.
Bounced-check fees are now an average of $30 per check and an insufficient funds charge of $45 on average. During the last six years, banks have raised the ATM fees by 25% with a surcharge of 40% more for foreign banks. Getting a cash advance from your credit card was always expensive, with a 2% fee and minimum of $2. Now, that fee is between 3% and 5% with a minimum of $15. Stop payments on checks were around $10 in the past, but now that cost has risen to $25 per transaction. Fees for returned deposits are now an additional $5 to $10 as well.
There were many courtesy services attributed to a free checking account which are no longer a courtesy. There are now standard fees to talk to bank tellers on the phone or in person for low-balance accounts and a fee of $10 for cashier’s checks or money orders, which were once free. Making payments on the phone or online is requiring a $5 to $15 fee. Above all of this, as if it weren’t hassle enough, lay miscellaneous fees, which are rising. Balance-transfer fees use to have a 3% to 4% fee for credit cards with an exchange fee of 3% for overseas transactions. Now a copy of an old check is $5 and a copy of any archived statement will put you out $10.
These new charges need to be disclosed to all customers so banks are sending short notices in the mail, which appear to be ordinary correspondence that are likely to be tossed in the trash without being read meaning that you will not likely be informed of the new charges until your next bank statement. Consumers have advocated that these new fees are unfair, especially on clients who maintain low balances and manage their checking accounts in a way so as to avoid as many penalties as possible and now this is the group who will be penalized the most.
Elias Cortez is from Dallas, TX and is a freelance writer and is the editor of TopNetbookPicks.com, which provide reviews and information for netbook computers. You can read his latest reviews on popular models such as the hp mini netbook and the toshiba mini nb305 at his site.