Banking 
61
comments

Best Free Checking Accounts

Blank CheckbookIf you were to build your personal finances from the ground up, the checking account would be the first “product” you’d pick. If you’ve ever drawn your financial network map, you’ll remember that the checking account is the spoke in your primarily hub-and-spoke layout. Your paycheck is deposited into your checking account, your savings accounts are linked to your checking account, and when it’s time to pay credit cards or the mortgage, chances are the money comes from your checking account.

So if you were to rebuild your personal finances or build it from scratch, the first step is finding a checking account that fits your needs. For me, I need a checking account to be free, have plenty of ATMs, and no minimum balance. If your bank doesn’t offer that as a minimum, I’d find one that does.

So how do you find the best free checking account?

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 Credit 
17
comments

Happiest Credit Cards

Liz Pulliam Weston recently published an article summarizing and analyzing J.D. Power and Associates 2008 survey of credit card user happiness. They surveyed 8,000 users on five factors: interaction with the company, billing and payment processes, fees and rates, reward programs, and benefits and services.

I was a little surprised to see that the highest score was 783 out of 1,000 for American Express, with Discover taking second with 751. Everyone else surveyed scored less than the industry average of 724!

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 Credit 
27
comments

Lowest Foreign Transaction Fee

In a couple months, my wife and I will be taking an extended vacation to Europe. It’ll be a fantastic trip, one we’ve been looking forward to for months, and with the dollar strengthening and the economy across the world weak, we figured we could take advantage of lower prices to get some traveling done.

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 Banking 
0
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2007 J.D. Power Satisfaction Ratings in Finance

J.D. Power & Associates puts out annual customer satisfaction surveys in all types of industries from automobiles to finance to insurance to travel (and many more in between). When they published their annual scores for finance companies late last year, I wanted to write about it to see how some of the companies I work with performed against their peers.

Author’s Aside/Note: I know it’s a little late but this one had been sitting in the hopper and I felt that I should post it anyway.

The Finance category itself is broken up into retail banking, mortgage related, and credit card groups. At the time I first wrote this, I didn’t think the mortgage ratings were that interesting so I skipped over it. I chose to focus on the two services I used more – retail banking and credit cards. While I don’t discuss the mortgage ratings, go check out how well Countrywide Home Loans did (hint: not well). :)

Retail Banking

The Retail Banking scores were rated based on geographic region:

  • Mid Atlantic: Commerce Bank (Bancorp)
  • Midwest: Commerce Bank (Bancshares)
  • Southeast: Bancorpsouth Bank
  • Southwest: Wachovia Bank
  • West: Bank Of The West

If you happen to have a Commerce Bank nearby and are a current customer (and you have kids), they’re running a summer reading program where kids can earn $10 for reading ten books.

Online savings account darlings WaMu and HSBC made appearances on the list as well (I looked primarily at the Mid Atlantic listing because that’s where I live, I suspect the scores are similar for the same banks). WaMu scored four points in overall satisfaction (with the highest score of 5 points under the Fees category) and HSBC scored three points. This past weekend we went to a wedding in Williamsport, PA, home of the Little League World Series, and saw scores of Sovereign Bank branches. Sovereign Bank scored a mere two points overall (and across the board). It was also funny to see M&T Bank’s whole name written out, Manufacturers & Traders Bank; I use them for my business banking and they’ve kept me very “satisfied.”

Credit Cards

In the Credit Card Satisfaction category, American Express edged out Discover for the highest rating in overall satisfaction and received the JD Power & Associates award. I personally use the American Express Costco TrueEarnings card because because I shop often at Costco and because it gives me 3% cash back on gasoline purchases (we also use a Discover Open Road card but that card caps rewards). My wife used to like their AMEX Blue card but it was recently replaced with the Citi CashReturns card because of the unlimited 1% cashback (and it once offered a 5% cashback on everything for the first three months).

The three companies that led up the rear with two points (out of five) were Capital One, Bank of America, and HSBC. I’ve never had a credit card from any of those companies. It’s interesting that when you arrange them by Overall Satisfaction (by clicking the sort arrows), HSBC appears below Bank of America. Bank of America has 2 points in all five categories while HSBC has three points for Rewards Program yet still appears below BoA. There must be some granularity within those points not captured somewhere.

Brokers

Finally, the investment broker category was the last of the categories I was interested in and it was broken into Full Service Investment Firm Ratings and Online Investment Firm Ratings. Raymond James took home the award in the Full Service Category and Scottrade (barely edging out Vanguard) took top honors in the Online Investment Firm Ratings.

I thought it was interesting that the only other “discount” online broker that made the list (TradeKing, Zecco, and many others didn’t make the list) was E*Trade Financial and they scored only two points.

With it being August, the 2008 ratings should be coming out soon in a few months. It’ll be interesting to see how much shifting around occurs with some of these scores.


 Banking 
5
comments

High Yield Savings Accounts at 20 Largest Banks

Despite what I wrote in Beware False Indicators of Bank Health, there is a certain amount of comfort in having a physical bank location to go to. A few years ago, a physical brick and mortar bank meant that you weren’t ever going to get close to a high yield saving account’s interest rates. However, several national brand name banks have begun offering high yield online savings accounts in order to compete for your deposits.

I used the list of the 20 largest banks, according to FDIC information current as of May 2008, and only found five banks that offered high yield savings accounts. I was surprised not to see Washington Mutual (3.75% APY) on the list of the largest 20 banks.

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 Banking, Credit 
21
comments

Banks Cash Fat Checks First

According to an article in USA Today, Citigroup, Bank of America, Chase, Wachovia, Wells Fargo, HSBC, U.S. Bank and SunTrust, eight of the ten largest largest banks in the united states, will cash checks that they receive on the same day in an order that maximizes overdraft possibilities. They will cash the largest checks first and the smallest checks last – this rule also applies for electronic transactions as well.

The banks defend their move by saying they want to give priority to the largest checks because they say that the larger checks are typically more important and you’d rather get a credit card payment bounced than a mortgage payment. Consumer advocates that banks are trying to screw the consumer because banks are relying on fees to make their money now that the spread is smaller. To be entirely honest, the order those checks are cashed shouldn’t matter – you should always have enough money in the bank to cover every check you write, otherwise you shouldn’t write them (whoops, typo, thanks Nick).

The articles goes on to explain the plight of Sean Tucker, 29, whose ego wrote checks (one of which was for $3.33) his body couldn’t cash to the tune of six overdraft fees and $200 out of his pocket. I’m sorry Sean… you need to be cognizant of how much money you have in the bank and you certainly shouldn’t be writing checks if you’re even close to being over, it’s simply not difficult to keep track of that stuff and if you’re simply careless, you deserve the fees so you’ll learn not to do it next time.

Personally, I prefer the checks cashed from the largest to the smallest because I’d rather have a $50 water bill bounce than my mortgage payment.


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