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Consider Moving Your Money to Local Banks

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This past weekend my wife and I went home to New York to visit my parents and my visiting relatives for the holidays. My parents recently moved within spitting distance of Port Jefferson, a cute little “village” that features a ferry and lots of restaurants and small boutique shops. My parents have been saying that the recession has really hurt the area and it’s most visible in the shops. Small shops have gone out of business and parking was now free, when before non-residents would have to pay.

On our walk we stopped by Boardwalk Games, a little board game store on the corner of Main Street and W. Broadway (their website says differently but I swore the store was on that corner). Anyway, we walked inside, talked to the couple who owned the store and walked out with a copy of Dominion, a card-based game that won some game award this year. We paid more for the game than we would’ve online but since the owners were so nice and friendly and the economy being so weak, it was good to put some of our money back into the local economy.

So what does this have to do with banks? I was chatting with Matt from Steadfast Finances when he accidentally sent me the link to the video. It talks about how if you are truly furious with how the “to big to fail” banks have been acting, vote with your wallet. Move your money to a community bank.

I don’t like how the video demonized the larger banks but I do like the message. If you don’t like how a store is behaving, boycott it. Plenty of people avoid Wal-Mart because they don’t like their business practices. If you don’t like how a bank or credit card company is treating you, take your business elsewhere. Don’t complain, don’t rant, don’t shout into the heavens… because they don’t care. If your money is still in your account there, they won’t listen to you because they already have what they want – your $$$.

I also like the message about supporting community businesses. For many years I’ve always advocated going with the highest (or lowest, depending on what you’re looking for) interest rate whether it’s a local or national bank. Now, with the spreads getting smaller (because national banks can’t rely on selling exotic financial instruments to make more money), it makes more sense to keep the money local.

As the old adage goes – think globally, act locally.

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49 Responses to “Consider Moving Your Money to Local Banks”

  1. Evan says:

    Jim,

    I didn’t know your parents were on the Island – I am about 20 mins from Port Jeff. If you ever have an interest I’d be happy to grab a drink or set up a blogger meet up next time you come out here.

  2. aua868s says:

    my CU offers better return for my checking account in spite of requiring a veny little minimum balance

  3. Wes Brain says:

    WE can make the difference. It is time to “fire your bank” and put money in your local credit union. I’ve used the Rogue Federal Credit Union (RFCU) since they started in a house on Peach Street in Medford, Oregon back in the early 70′s… They rock!

    Last year after getting upset with these banks that were “too big to fail” and had received OUR taxpayer money to bail ‘em out I did some exploration about the RFCU to find out about its investments. I went up to a teller at the Ashland branch of the RFCU and said, “I want to talk to the most important person here” and before the day was over I was on the phone with the credit union’s CEO Gene Pelham. Not long after I was able to interview Mr. Pelham on my radio show at KSKQ here in Ashland, Oregon.

    On the Brain Labor Report for March 30, 2009 we interview Gene Pelham, President and CEO of the Rogue Federal Credit Union, a credit union which focuses on Southern Oregon.March 30, 2009 >>> Listen or Download Here: http://ia331427.us.archive.org/1/items/BrainLaborReportMarch30/blr20090330.mp3

  4. Glen2gs says:

    Just opened another account at our local credit union because my 11yr old son’s saving account at Chase…”disappeared”

    Yup, Chase is so desperate for Money that they have resorted to stealing it from Children…

    Seems that my Son’s “Young Savers Account” went 6mos without activity (with a balance of between $250/$300)rather than notify his Mother..they closed the account…they didn’t send the money to the State, as they are to do with abandoned accounts…at first, they tried to tell my Ex that the account didn’t exist…because it was a WaMu account before Chase took over

    Happy Ending…My Son got a NEW “Young Savers Account” at our local Credit Union…Got MOST of his money back..(except for a $20 GREED Fee to Feed the Bankster/Oligarchs that run Chase)

  5. Our best bank experience by a wide margin was with a local bank in NJ – Peapack-Gladstone Bank. It was locally and independently owned, and offered small town customer service, as though everyone at the bank knew you personally, even though they usually didn’t.

    One time, the called me in advance to let me know that a charge was about to clear my account and that I could avoid overdraft fees by making a deposit. This was typical of their service.

    We moved out of state some years ago, but the bank is still there, still independent, and we often think about reopening accounts with them.

  6. pmulroy says:

    There are good and bad things about both big banks and local banks. Choose what is more important to you and vote with your dollars.

  7. James says:

    I’ve been CU only for about 10 years now, and I’ve been very happy with their service. One other thing to look into is high interest checking accounts at CUs –
    4.01 APY -http://www.3riversfcu.org/prodserv/rate_save.html
    3.51 APY – http://www.midwestreward.com/

    There are some restrictions, but nothing outrageous.

    James

  8. Debra says:

    Good for you, Jim. I’m on-board. Think the “Wonderful Life” video is the perfect illustration. Thanks.

  9. jsbrendog says:

    ive been wanting to dump chase for awhile now and there is a good credit union near me…its just so convenient to see a chase on literally every corner, and if not a chase then a duane reade with chase atms….

  10. CarlS says:

    I’ve used local banks, credit unions, and major banks all over the last few years. I recommend checking out your local bank’s finances before moving funds there. While it may be insured by the FDIC, you may find that one day your bank has been closed by the FDIC. They’ve been quietly closing many local banks across the country while the national news media has been focusing on the big boys. Your money may be safe, but it can be a headache. I did a search at BankRate and BauerFinancial and found that one of my local banks that I’d been eying had a 1-star rating (the lowest for ranked banks), while most locals had 4 and 5-star rankings. I suggest readers do your homework, particularly in this climate. There are listings for both banks and credit unions there. In the end, today I opened a credit union account at a local credit union that has a BankRate 4-star and BauerFinancial 5-star rating. I’m still keeping my major bank account though. There’s still something to be said for having the convenience of fee-free ATMs 1,200 miles from home.

  11. JimmyDaGeek says:

    I wish you would expand the theme of boycotting businesses, products and industries you don’t agree with. Most Americans have become whiners, illegally using the political system to force changes that should be done through the market system.

    For example, look at all the complaints people have about cable tv regarding customer service and pricing. If people don’t like it, don’t buy the service. You can get your tv off the air, rent movies so many different ways, get tv shows on the Internet, etc. Yet people call their local pol to pass some kind of law to give them what they want.

    Americans have this expectation of getting what they want instead of doing without.

  12. Natalie says:

    I want to do that but I don’t know how to go about finding a community bank which one in my community is a community bank and would qualify and which credit cards should I tear up.

  13. JimmyDaGeek says:

    Natalie, the odds are a bank with your local area’s name is a community bank, as well as any bank that only has one or two branches in total. Don’t forget to look into credit unions. Many have simple qualifications, like living and/or working in a certain area.

  14. Aaron N. says:

    Even though I have a few accounts with some of the bigger banks, I do most of business with a local FSB, which is nice because all of that money is invested locally and I have someone who knows me and my banking needs that I can actually talk to.

  15. govenar says:

    The reason I opened a rewards checking account at a local bank is that they might be more likely to keep paying a high interest rate if they’re not flooded with money from all over the country.


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