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Thread: Bank fees increased - savings accounts not encouraged

  1. #1
    Senior Member helencalif's Avatar
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    Default Bank fees increased - savings accounts not encouraged

    I can remember way back when I was in the 5th grade my teacher initiated a project whereby every student opened up a savings account at a local bank. We were encouraged to "save" by putting in 25-cents every week. Sometimes it was hard for an 11 year old to do, but most of us participated every week. She collected the money and the bank books, did the banking for us on a Friday (what a chore that must have been) and redistributed the bank books to us in class on Monday so we could see our savings account grow. It was a math project. We learned about banks, about interest, and how saving money was a good thing. I have never forgotten the lesson.

    One of the clubs for whom I am treasurer has a savings account. It doesn't earn much -- about 49-cents a month -- but it is earning something which is better than nothing.

    Until now. I just got a notice from the bank that effective Aug. 5 there will be a monthly service charge of $5 to have a savings account -- no matter the balance.

    I will be calling on Monday to confirm that they will be charging our non-profit club $5 a month. If they tell me that is the case, I will be closing out the savings account.

    Sad isn't it how things have changed.

    Helen

  2. #2
    Senior Member luvmylabs23139's Avatar
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    I just got the latest statement in for one of our savings accounts. $10,000 earned 69 cents in interest for the month. Almost feel like pulling it and putting the cash in the safe. Long gone are the days when banks fought for your deposits with ads for CD rates.
    Hihope Hiland Heathen of Perth CD, RE, CGC, TDI

  3. #3
    Senior Member helencalif's Avatar
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    Small amount savings accounts are not profitable for banks. Oh yes, they want the money because they need it to make loans, but the interest being paid to the savings account holder is about nil. Our club does not get monthly statements for its savings account anymore. Not worth it for the bank to print a statement and mail it. I am figuring the new $5 per month service fee is to encourage the small account holders to leave the bank. So we will.

    Helen

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    Helen, around here credit unions and small banks are doing everything they can to get every small saving accounts they can possibly get, no fees, free checking, competitive loans. Basically they are doing the opposite of what you are saying. I guess the large banks figure that if they fail they will get the bailouts all over again.
    Last edited by mngundog; 08-03-2013 at 10:22 PM.

  5. #5
    Senior Member Dave Farrar's Avatar
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    I have an account with $10K in also. I think I make 57 cents a month on it. Low interest rates go both ways; I really like my 3.3% mortgage rate...
    DUCKDAWG'S MAC'S MAGICAL MR. OCTOBER JH -- Reggie

  6. #6
    Senior Member Gerry Clinchy's Avatar
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    Hey, you guys need to put those big dollar amounts in an ING (now Capital360) savings account. $1000 earns about 60 cents, so $10,000 would earn about $6. Still not much, but better than what you're getting on those accounts. You can transfer money back and forth from your checking account and savings account ... takes 2 or 3 business days for a transfer. You can schedule transfers ahead of time when you know you are going to need funds on a certain date (but you still have to allow "X" days from the date of transfer till you can expect it to be available in the other account). No minimum balance required.

    They also offer checking accounts that don't require a minimum balance, then transfers between accounts is immediate. That comes with an ATM card as well. I don't know if they give you paper checks for the checking accounts though, since I don't have a checking account with them.

    Discover also offers savings accounts with higher interest than the local banks, but as I recall (from the stuff that comes in the mail), you may need a large balance to get the good interest rate.

    Our local bank now requires a minimum balance in the savings account to avoid a monthly charge. However, they still have accounts for students that can have less than the minimum balance, and no service charge.

    Interesting, the minimum balance on their savings accounts is larger than the min. balance required for their free checking accounts!
    G.Clinchy@gmail.com
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  7. #7
    Senior Member helencalif's Avatar
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    I called the bank to ask about the new $5 monthly service fee on savings accounts. The person asked for our account number and I gave it to her. She came back with an answer..."You are a non-profit organization. We are not charging monthly fees to clubs who are non-profits."

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    Senior Member kdeckels's Avatar
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    Banks in good financial position in this area are saying "No, Thanks" to deposits by lowering their rates. When they need deposits they will become competitive again. Banks are a "for profit" business, and think of how cheap they can get money from the Fed. They analyze whether you are a "profitable" customer to them; just like every other business, it's about the bottom line.
    HR True Grits Finer Edge

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    Senior Member swampcollielover's Avatar
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    My Dad, (God Rest Bless his Sole) was in banking all his life. Following WWII he started as a bank clerk in Denver, CO and over the years worked his way up. It was an honorable profession and I followed in his footsteps joining a bank in Denver, CO as a mail clerk. By 1980 I saw that the industry was changing and I left banking never looking back. Today I have free checking accounts that pay interest, these are out their if you look! Other than that I would never leave money in a bank. I keep the money I need to keep "liquid" in short-term bonds, or money markets....interest rates here are still low, but better than anything banks are offering. The day of Banking, as many of us remember are gone!

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    Senior Member M&K's Retrievers's Avatar
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    My Dad always said banks should have 3 balls outside their door'

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