My husband and I have been mulling over a refinance over the last few months. Our mortgage was rolled over to another banking institution when Washington Mutual folded, and I’ve never really enjoyed the service. The clincher came when I called to talk about options and interest rates. I did my homework: I checked rates online, pulled my credit report, and ran a quick home valuation so I could approach them with solid numbers. Unfortunately, the rate they offered me was nowhere near their best.
Malcolm Holland, president of $650 million Veritex Community Bank in Dallas, Texas, worries about the future of community banks as a result of increasing federal regulations and growing compliance costs. His concern is based upon the increasing expansion of federal rules that limit the flexibility of community bankers to meet the needs of their customers: “Community banks need to be creative because small business is creative. If we can’t meet the needs of small business – the core of our business – the economy as we’ve known it will cease to exist.”
Historically, exchanges of value – barter systems – were done face-to-face so that participants could instantly verify the respective physical properties being exchanged. As purchasers and sellers became geographically distant, agents or trusted third-parties acting on behalf of the participants became necessary to verify the quantity or quality of the property being transferred. For example, credit card issuers are examples of a third-party standing in for a buyer, guaranteeing to the seller that the buyer’s funds are good.
Until about five years ago, I used to carry my checkbook everywhere. In fact, some of my purses even had a special compartment that provided easy access to my oft-used pad of checks. Nowadays, however, I leave my checkbook at home. In fact, I can’t remember the last time I wrote a paper check.
This change in consumer behavior is the result of several factors, including the introduction of more convenient payment methods, the growth in online shopping, concerns about fraud and identity theft, and a desire to avoid bounced check fees. For many people, it is faster and simpler to swipe a debit or credit card than it is to write out a check while shopping at brick and mortar establishments. Many online merchants only accept credit and debit cards. Online bill payment services make sending payments easier by automating the process.
The best way to ensure that you build wealth and avoid debt is to diligently plan and save as much money as possible for both future needs and desires. However, exactly how you handle your savings can depend greatly upon your financial habits. Some financial experts recommend setting up a simple savings account tied to your checking account, while others advocate opening multiple accounts to be used for various savings targets.
There are pros and cons to each approach. Of course, a major part of your final decision depends on your financial personality.
Questions About Your Savings Habits
I remember when I received my first credit card offer. I was 18 and fresh out of high school and, frankly, I was flattered that Visa thought I was responsible enough for a card. Of course, I know now that pretty much every 18-year-old receives credit card offers, but at the time I couldn’t wait to get my own. I signed up and was later mailed my shiny card, which came with a $1,500 credit limit.
Until President Richard Nixon took the United States off the gold standard in the 1970s, American cash was redeemable for gold or silver. Currently, the U.S. is on a system using fiat currency via the Federal Reserve, as the value of money is based on faith in government and law. While the Federal Reserve maintains control of the physical cash system, some powerful industry forces are trying to change that.
Conservative investors who are disappointed with the mediocre rates of interest offered on their local bank’s CDs may want to explore the world of brokered certificates of deposit. These unique instruments resemble those that are sold in bank lobbies in some respects, but there are critical differences between them.
Brokered CDs can be a valuable addition to any fixed-income portfolio as long as the purchaser understands how these instruments work – and their potential pitfalls.
What Is a Brokered CD?
As it turns out, my husband and I have completely different spending and saving habits – something we neglected to realize during our long-distance dating relationship. Money become a huge sore spot, and it resulted in shenanigans like me hiding shopping bags, and him tucking away freelance income so I couldn’t get to it.
You might not realize that selecting a bank is one of the most important financial decisions you’ll ever make. Banks can avail you of financial opportunities like high interest savings accounts and free checks, or they can cost you money and inconvenience you in a myriad of ways from monthly maintenance fees to limited ATM availability.
Picking the right one can help your life run smoothly, while picking the wrong one can be frustrating and take time away from the things that are most important to you.
4 Types of Banks – Pros & Cons
At a time when banks are making record profits and customers are paying higher fees, many people are seeking financial institutions that will help them save money. One such institution could be your local credit union.
Credit unions offer numerous financial products that help people maximize their incomes and increase their savings, often with fewer or lower fees than traditional banks. But these institutions also have disadvantages which may make them unappealing to some banking customers.
What Is a Credit Union?
Credit unions are similar to traditional banks in the sense that both institutions offer financial products to customers. Credit union members, like bank customers, have access to checking and savings accounts, CDs, loan products, and credit cards.