Every few months, I like to take a look at our financial network map to update it and see if there are ways I can optimize what we are doing. The last few years, most of the focus was on reducing the number of accounts we had. It had bloated tremendously, as the proliferation of online banks (and my application and review of all of them) led to a ton of accounts, and optimization meant culling the herd.

Now that our map is leaner, one area I haven’t spent a lot of time on was the checking account portion. Until the last few years, checking accounts were pretty standard. You earned no interest, you had to kept a daily balance to avoid a fee, and the accounts were as utilitarian as you could get.

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With bank fees continuing to frustrate consumers, some brokerages are stepping in to fill what they perceive as a need. With technology making it possible for nearly anyone to open a brokerage account and start investing, it isn’t much of a surprise that some are beginning to wonder if it might be easier to simply bank with a broker.

And, with some brokerages offering great deals to banking customers, it can be a great way to avoid bank fees, and perhaps even earn a return on the money you keep in your checking account.

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Citizens Bank is the latest bank to reach a settlement for overdraft fees, a wave of settlements that started sometime last year. The Bank of America settlement and Fifth Third Bank settlement had previously been covered here. Citizens Bank, along with many other banks, was accused of reordering customers’ transactions in order to maximize overdraft fee revenue, a common tactic used a few years ago in order to increase fee revenue. Citizens Bank is the 13th bank to reach a settlement.

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In recent months, there has been a lot of discussion about prepaid debit cards. From the introduction of Suze Orman’s prepaid debit card, to suggestions that you don’t need a bank account if you have a prepaid card, to a general push by issuers to encourage parents to use prepaid debit cards as learning tools, it seems like prepaid debit is everywhere.

But what is prepaid debit? And is it really a good idea?

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More than anything else, I love reading trivia and “how things work” because it gives me a little behind the scenes glimpse at stuff most people don’t see. When it comes to personal finance, there isn’t really much trivia floating around unless it has to do with our money. There’s just something mysterious about our money, the imagery, and little idiosyncrasies. While our money doesn’t have the color or creativity of other nation’s currency, there are still fun things to discover about it.

Today, we’re going to take a look at the serial numbers and how they work.

First, we need to separate “new” style bills from old ones. New bills are the ones introduced within the last few years. They feature enormous faces that aren’t on those familiar black backgrounds. Here’s an example of a new bill:
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ING Direct was once far ahead of the pack in terms of banking innovation, offering a high yield savings account and pretty much scaring people with how good their rates were. The online service was fantastic, since that’s all you had in terms of interface with the bank, and it was amazing how quickly you could do things. Perhaps they rested on their laurels, maybe they just wanted to be deliberate, but only now have they joined the ranks of banks that offer remote deposit. Remote deposit is when you can deposit a check without having to mail something in or go to a bank or automated teller machine.

The service is called CheckMate and there are two ways to deposit your check remotely. The first way is to download their ING Direct app, take a photo, and upload it. The second involves taking a picture of the check, logging into the website, and uploading it.

I used the ING Direct app and the process was painless. There is a limit of $3,000 maximum per check and after you take a photo of the front and back, you’re asked to enter the amount of the check (it won’t read it off the image, or they use it as verification). Then, you’re told the deposit will be available May 17th. Once ING receives the image, they email you. Once the deposit is confirmed, they email you again (and you can destroy the check).

Seems pretty pretty easy to me, hopefully the deposit goes through!

Update: Deposit was confirmed within a couple hours of submission.

Do you have a million dollars? Do you want a Mercedes Benz? In conjunction with a name change from Community Bank to C1 Bank, anyone who deposits a million dollars into a five-year CD product will be able to choose from a 2012 SLK350 Roadster, 2012 E350 Sedan, 2012 ML350 SUV, as prepaid interest 2012 E350 Convertible. In a press release, one of the few I ever read, CEO Trevor Burgess announced a partnership with Crown Eurocars to offer a Mercedes Benz as prepaid interest on the million dollar five year certificate of deposit.

In the release, Burgess cites 1.20% APY as the current rate for five year CDs, we found that several banks had higher rates on our CD rates table, but none of them pay you the interest up front… in the form of a Mercedes Benz.

If you are considering it (who are you!?!?!?), the offer is valued through July 31st, 2012 and valid only for Florida residents with a limit of two per household. The calculated interest will be $61,294 and it will be applied towards the purchase of one of the four models listed, including sales tax, registration, tires, and other fees. There is a “significant” early withdrawal penalty and I’d expect to get a nice fat 1099-INT.

The really clever part of all this is that they offer the interest up front, I’ve never seen that before.

(Photo: tetsumo)

Remember when IndyMac failed? There were all those pictures of people lining up to withdraw their money? Back then, the FDIC limits were $100,000 and most of those people had much less than $100,000 in deposit accounts at IndyMac. That meant that everyone in line wasted many hours of their life withdrawing money that was 100% safe (I don’t really blame them, it was a scary time).

The FDIC, created by the Glass-Steagal Act of 1933, provides deposit insurance for your deposits in an FDIC insured bank. Most banks are FDIC insured and you can confirm this using the FDIC bank tool. When a bank fails, the FDIC usually comes in on a Friday and the bank is open for business the following Monday. This has happened hundreds of times, they’ve never faltered from that schedule, and there is no reason to believe they every will… but it doesn’t make it any less scary. (watch what happens when the FDIC shutters a bank, before, during and after – it’s an interesting look into the process)

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