convenience

10 Advantages of Keeping All of Your Accounts at One Financial Institution

February 20, 2013 By Jennifer Derrick 7 Comments

Last week I wrote a piece about the advantages of keeping accounts at multiple financial institutions. The benefits range from having fall back money if one account is compromised to taking advantage of the strengths of certain types of banks. While I feel that it is best to keep accounts at a least a couple of different institutions as that strategy offers you the most protection, there are people who feel differently and prefer to do all of their business with just one bank. Neither approach is right or wrong, just different ways of doing things. In the interest of exploring all of the options, here are some advantages you might find to keeping all of your accounts in one place.

Convenience & Time Savings

When everything is in one bank, you only have to visit one place to conduct all of your banking business. It can also save you time and hassle if you move or need to make other account changes. You can make one phone call and be done.

Relationship Building

If you do all of your business with one bank (and particularly if you consistently visit one branch of that bank), you are likely to become known to the tellers and bankers. There’s some value in knowing the people who handle your money. It can make you more comfortable and make everything flow smoother when you’re more than just a name in the computer. (See numbers 3, 5, and 8, below.)

Preferential Treatment

When you have all of your money with one bank, not only are you known to the employees, you may also get some preferential treatment. Maybe your calls will get returned quicker, you’ll be seen faster, or you’ll get advance notice of specials or called a new account type becomes available that might benefit you. Of course, any of this will depend on your bank and just how “preferred” you are, but you might get some preferential treatment by keeping everything in one place.

Save on Fees

If you have all your accounts at one bank, you are more likely to hit any minimum balance, direct deposit, or transaction requirements in order to qualify for free banking and other services. Banks may be willing to waive fees for customers who use them exclusively. If your accounts are in multiple places, you might not have enough money to hit those targets everywhere, meaning you’ll pay more in fees.

Perks & Freebies

You might qualify for lower rates on loans or higher rates on savings accounts. You might have things like safe-deposit box fees waived, or you may qualify for reduced (or no) closing costs on mortgages or refinances. You might be eligible for account types that aren’t available to general customers. Annual fees on credit cards might be removed for you. Some banks offer nice perks to those who do all of their banking and investing with them.

Easy Record Keeping & Budgeting

All of your statements, balances, transactions, and accounts are available with one login or one download to your money program. You don’t have to remember multiple passwords or keep contact information for several banks handy.

Higher Rates of Return

Having all of your money in one place may qualify you for higher rates on savings products. As your account balances grow, you may be eligible to move into higher earning tiers.

Lower Identity Theft Risk

Since you’re using fewer debit cards, credit cards, checking accounts, and website logins, your odds of identity theft are reduced. Not to say it won’t happen, but statistically your odds are lower than the person who has lots of credit cards and bank account numbers floating around out there.

No “Missing Money” Risk

When everything is in one place, you don’t run the risk of having a forgotten CD or small bank balance hanging around somewhere. You know exactly where everything is and how much you have. This will also make it much easier on your heirs to sort out your accounts if something happens to you.

Easier Problem Solving

If something goes wrong with an account (a mistake is made, or it is hacked, for example), it is easier to only make one phone call and deal with one person at your regular bank to correct the situation. If you have accounts in multiple places, you end up having call or login to multiple banks to get money transferred to cover the mistake while also dealing with the bank that made the mistake. It can be a pain.

While it’s up to you to decide which approach works for you and your needs, remember that it doesn’t have to be all or nothing. You can compromise and keep most of your money in one place, but open another “safety” account somewhere else. That way you’ll have the best of both worlds: Additional protections from loss or theft, but maybe you’ll also qualify for some of the perks and benefits afforded to those who are loyal to one institution.

(Photo courtesy of Svadilfari)

Sit Less To Save Money

September 24, 2012 By Jennifer Derrick 6 Comments

Sitting is the new smoking, it seems. While the medical establishment has long been trying to get people to become more active, various studies have been focusing on the negative effects of sitting too long rather than simply looking at the positives of exercise. A recent study showed that sitting less than three hours per day may add up to two years to your life expectancy. It’s no longer enough to exercise thirty minutes a day. You have to keep moving all day long.

While it’s definitely a benefit to your health to keep moving, I see it as a benefit to your wallet, as well. Many things that we spend money on either require us to be seated, or result in us sitting even more. Meals out? Seated. Movies? Seated. Cable TV? Seated. Video games? Seated (unless you’re talking exer-games). Cars? Seated. Flat screen TV’s? Seated. Tablets/computers? Seated. Even cell phones are a sedentary activity unless you make the effort to move while you’re talking or texting. While some of this is inescapable (you probably have to drive at least some of the time, for example), there is an argument to be made that a lot of spending activities are also seated activities.

On the other hand, many of the things that we do to save money require us to be up and around. Cleaning your own house instead of hiring someone? Activity. Biking or walking to work/school? Activity. Doing your own yard work? Activity. Handling your own maintenance, repairs, and chores? Activity. Moving yourself instead of hiring movers? Major activity. Spending a day at the park with the kids instead of going to the movies? Activity. Cooking your own meals? Activity. Growing your own garden? Activity. Building or making something instead of going for the pre-made solution? Activity. Playing games with the family like Twister, Wii Sports, tag, or hide and seek instead of paying for cable? Activity. In most cases, the more steps you take to save money and cut expenses, the more active you are.

We’ve convenienced ourselves to death. We’ve tried so hard to make everything easy for ourselves and if we can’t make it easy, we pay someone else to do it. We make it so that we don’t have to get up to do anything. Email/IM means we don’t even have to get up to go talk to someone three rooms away. Heck, some sofas even come with built in refrigerators now so we don’t even have to get up to get a drink. Many money saving activities, however, harken back to a time when everything wasn’t so easy, when some manual labor was required to get anything done and when there wasn’t a service you could pay to do it for you.

If you’re really against sitting and have some extra time on your hands, you can even make money by sitting less. You can take a part time job in a field like retail or construction where you don’t sit much. You can deliver packages or pizzas. You can hire yourself out to those who choose to remain sedentary. You can clean their homes, mow their lawns, and handle their maintenance. You can move their furniture, walk their dogs, or scoop their dog’s poop. Just as there are plenty of ways to save money by sitting less, there are plenty of ways to make money by being up and active.

It’s not an easy adjustment to make and many people balk at the idea of doing things the “hard way.” Mention to someone that they could bike those three miles to work instead of drive and you can practically see their hair curl. But the hard way is better for your physical health and your financial health. The more you do yourself, the fewer tasks you turn over to others, and the less you rely on conveniences, the better off you are. Think about what you might do with those extra two years of your life.

(Photo courtesy of mattzor)

Paying Less Isn’t Always Smart

September 1, 2008 By Shane C. 2 Comments

Technology has made it much simpler to compare rates and find the cheapest prices for services and products. Why pull out the phone book to call several insurance agents to find the best price when you can visit one website to instantly get the most competitive price quotes? Why settle for paltry interest rates at your local bank when you can take advantage of high rates at banks that operate exclusively online?

I say there is good reason.

In many situations, price should not be the deciding factor when buying a service or product. Rather, creating relationships with those offering the product or service can reap rewards down the road, even if it means paying a higher price.

My wife and her family are mostly responsible for introducing me to this concept, and, while I was skeptical at first, I quickly warmed up to the idea.

I had my checking, savings, credit card and brokerage account at a large national bank. I loved the convenience their online interface gave me to track and manage all of these accounts in the same place. And the company had branches and ATMs anywhere I went.

My wife, along with everyone in her large family, did all of their banking at a small, local bank. They have very few branches and ATMs, and their online banking is just OK. I was tempted to try to get her to switch to my bank just to maintain the convenience of my consolidated accounts and slick online banking features. But I knew how much faith my wife had in her bank and that she would be more comfortable if we consolidated our accounts there. Despite all the fuss we make about never being able to speak to a human on the phone when calling a company, I was equally hesitant of the thought of dealing with a human while doing my actual banking.

So, ditching the online forms I would have usually turned to, my wife dragged me into her bank to get added to her account. Very unexpectedly, we were greeted as soon as we walked in by someone who knew my wife’s first name! Had she put on a name tag before we walked in without me noticing? No, in fact, almost everyone there knew who she was. Several more people came up and asked her how various people in her family were doing.

Pretty soon, they started to recognize me on my weekly visits to the bank. There I was, with everyone in the bank gathered around, showing pictures of our newborn daughter from my phone. But it’s not just about being noticed.

When the bank needed to update some of our information, we received a personal letter describing exactly what they needed and who to contact. On another occasion, my wife happened to go into the bank one day when some customers’ ATM cards had been compromised (a retailer’s fault, not the bank’s), and since the teller recognized her as someone on a list to notify, she told her in person and began the process of getting a new card.

I have had the same experience with our insurance agent. We have his direct email address, which we have used several times for help and to update information. My brother-in-law has a truck he uses only occasionally if he has something to haul, so there is no need to have it insured at all times. If he knows he is going to use it, he can call or email our agent to ask him to insure it for the day or weekend.

We get the same friendly and attentive service at our dentist, where my wife’s family has been going forever. When I had a problem with a crown I had fitted, it was fixed with no questions asked, at no charge and I received a handwritten note and a gift card to a restaurant for my inconvenience.

I am sure that we could find cheaper insurance if we shopped around and compared prices, and I know I could do my banking with a company that has more ATMs. However, it’s worth it to know that if I ever had a problem with anything, I know exactly who I need to speak with and how to get in touch with them. How many of you have your insurance agent’s direct contact information in your cell phone?

I believe that anyone can foster these relationships with everyone from their local barista to their banker. It may take a little more upfront work on your part, and you may pay a little more in the long run. Peace of mind and convenience are also worth something, and the time may come that these relationships pay off if you have an emergency or a problem.

Here’s some tips to get started:

Be consistent. Don’t go to the place with the best deal today.

Always get your coffee at the same place. A small tip every now and then may help you get noticed and ensure your drink is made exactly the way you like it. You may pay less at the new stand with a grand opening special, but will they know how to make your drink exactly the way you like it? You know you will get what you are paying for.

Get your oil changed at the same place every time. There is nothing better than having a mechanic you can trust. They may diagnose a problem or do very minor things for free, and discounts may be offered for larger repairs.

Ask what you can expect.

Before signing up for new auto insurance, ask how you can contact them in an emergency. If they give you their cell phone number or email address, you know you are on the right track. Steer clear if they refer to the company’s 1-800 number.

Get a referral.

There is no better way to know what you are getting into and jump start a relationship than getting a referral from a trusted friend, family member or other professional. Make sure that you mention you were referred and who told you about them. You can ask someone who may be in a related field for advice, but make sure a monetary incentive is not the only reason for the referral. That’s not to say a mortgage broker couldn’t offer good advice on a real estate agent, but a friend who was very happy with the sale of their home may be a less biased source.

Chasing rates, prices and deals can be great ways to cut month-to-month costs, but building a relationship with those providing essential and sometimes lifesaving services can prove priceless.

Image courtesy of striatic

The Item That Will Change Your Life

December 19, 2007 By Cortni Marrazzo 2 Comments

Why is it that we can hear that promise again and again for different products, yet we still perk our ears up to find out what it is that is being advertised and if it really will change our life? We all want the magic cure to the inconveniences we face in life but does that really exist, and if it does, how much is it worth?

Enter the world of salesmen and “As Seen on TV” products. You’ve seen the commercials: “Have you ever had this happen to you? (insert annoying occurrence here) Well, then you need (insert product being sold). And you can get it for only $19.95!” (and why, exactly, are all those products $19.95?)

What this kind of advertising does is point out a tiny inconvenience that you never even realized before, but now want fixed. I never realized the difficulty I had putting up pictures on the wall until I saw the ad for the Hercules Hooks. They made it look so easy and convenient! I’m ashamed to say that I ordered those Hercules Hooks and ended up paying $10 in shipping for them in addition to the sales price. I’m even more ashamed to say (but not really surprised) that they are sitting in a drawer somewhere in my house unused because they didn’t work well.

It’s all advertising. They tell you why you need the product and it if they convince you it doesn’t seem to matter how much it costs because “it’s so worth it.” And this isn’t only for “As Seen On TV” products either (although they seem to be the pinnacle of the whole epidemic). The other night I went to an at home demonstration for a company that sells kitchen tools and accessories. This is something I wanted to go to because I wanted to purchase a few of their products, so I wasn’t roped into it by any means.

The consultant was very nice and chipper and actually did a pretty good job on selling the items by showing how handy they were while cooking a meal. I had to laugh at the concept of the whole thing though. At one point the product being described was a pitcher that had a built in mixer and the selling point was that it was a lot easier to use than stirring manually with your hand and spilling juice all over the counter. This made me chuckle a little bit because a) I’ve never spilled juice all over the counter while mixing it and b) stirring juice with a spoon isn’t very difficult. Now granted, I hardly ever make juice so spending $30 on a product like this wouldn’t make sense for me. But even if I did make juice a lot, I think I would save the $30 and consider it payment for the work of manually stirring my juice. I’ve never really thought about all the “work” that goes into stirring juice until that night.

Also on display was a really nice knife that apparently made cutting vegetables and different things extremely easy. We were told that the professional chefs on TV only looked like they were so good at chopping because they had a nice knife and I too could look like a TV chef if I bought this $70 knife. I’m sure that was a wonderful knife, but no knife, or any other item of combination thereof, will make me look like a TV chef. Cooking’s not really my thing and I’m sure I wouldn’t do that knife justice.

There were many other products described that night that promised to make cooking simpler, easier and more convenient. Now I don’t doubt that those products would do that and I did actually end up purchasing a few lower priced items, but I wouldn’t consider most cooking conveniences worth spending the money they were charging for some of these items. This has a lot to do with my lack of passion for being in the kitchen and cooking, but it also has to do with the fact that I’m willing to deal with inconveniences to save money.

You can’t get rid of inconveniences in life and they have to be dealt with. Cleaning my house is pretty inconvenient but I’d rather do it myself and save the expense of hiring a maid. I can clean my house and invest the would-be maid’s salary. Maybe it’s my frugal nature or my passion for sacrificing and saving and investing more early on in life, but there are just some inconveniences I’m willing to deal with in life.

So the next time a product promises to change your life, step back a minute and do a true evaluation before getting suckered in. There is a good chance that, even with all the promises and the $19.95 price, it’s not going to.