Spring time, when a family’s thoughts turn to buying a house, squiring children on spring break or perhaps taking that long awaited trip overseas.
In others words, it’s often when many people spend money, whether it’s the temperature, the extra hour of sunlight or the impending start of the baseball season, to feel good about life.
Unfortunately, that’s the perfect formula for not making sensible financial decisions, failing to do careful homework, not looking at the small print and becoming a prime target for a plucking.
So while it may be a good time for lots of potential delights (I’m especially partial to baseball), it’s imperative that before leaping forward to daylight savings time, you also one take a step back, hide your wallet and ask the financial questions that may save hundreds or thousands of dollars in payments from those very people who you are counting on to help bring a sunlight-induced dream to reality.
Although they want us to think that banks are looking out for us, they’re not always as transparent as we’d like them to be. Many aspects of banking are not widely known and deliberately are not advertised. Many unsuspecting customers are not likely to be aware of these secrets.
Explaining what the banks do not want you to know may shatter most of the public’s entrenched assumptions about money and banking. What the general public believes it knows about money and banking is largely based upon a collection of canards gleaned from TV, radio, newspapers and their own personal, casual experiences. For example, many people learned the hard way how checks they deposit are held for three days before the money is actually available for use.
Every day your haste becomes their basis for some extra money here and there, to flow from your pockets to their asset sheet. They ask for lots of information and you just want get to get your loan, mortgage or equity line of credit.
Thus, to make your spring financial fling as free from drama and bank fees as possible, here are the top 9 things banks don’t want you to know:
1. Banks make mistakes daily on inaccurately calculating interest in both loans and deposits. They rarely catch their own mistakes so it is up to you to check your statements for such errors
2. Borrowers need to do the majority of the work to get the best deal possible. If a borrower leaves the work to the banker they will likely pay higher fees and rates.
3. All rates and fees are negotiable. The broader the full banking relationship the higher probability of getting those fees waived.
4. When you receive money via direct deposit from a company or the government, it is sent through an electronic network, or Automated Clearing House (ACH). Some banks, however, categorize those payments and all other bank transfers, or PayPal, or other means, as “PPD” (prearranged payment and deposits). If this is the case with your bank, when you check your bank statements and it says “PPD” next to your deposit, this will fulfill the requirement for direct deposit, waiving your monthly fee.
5. Online banking is not as safe as it appears. Over 70 percent of banks found web design security flaws within their online infrastructure.
6. Never use an ATM OVERSEAS. The highest occurrence of identity theft is reported in foreign territories.
7. Every time you swipe a debit or credit card, the bank is making money by charging the merchant certain fees.
8. Promotional credit card offers typically want you to spend a certain amount within a time frame. Although it’s may be a great deal for you, the bank is actually doing that for its own benefit. The more you spend swiping your card, the quicker the banks make their money back from the fees. Banks are counting on the fact that, once you’ve racked up the $1,000, you won’t be able to pay it all off in one month so you’ll be paying them interest.
9. Be aware of what’s known as “cross default.” Missing a car payment on one account could create a domino event and allow the same bank to charge you higher interest on your mortgage or student loans. You should avoid opening a bank credit card that has this clause in its agreement.
10. Credit unions pay higher interest in deposits than banks.
