| Free checking: Make sure it's really
free |
|
|
|
Bank of America touts its My Access account as free,
as long as you have direct deposit. That's fine with a lot of people,
especially since the bank offers free online bill payment. But if
you get laid off and no longer have a paycheck direct-deposited,
you'll be charged a monthly service fee for checking privileges.
Free, but with strings attached
Many banks waive fees if you maintain a certain
minimum balance. If maintaining that balance is OK with you, then
you have essentially created a free account for yourself.
"The consumer has to examine what their needs
are relative to the checking account," says Driskill of Synergistics
Research. "'Will I be an ATM user? How many checks do I write
each month? Do I want online bill payment?' There are a lot of aspects
now. It's not like before, when all you had was a checkbook."
Check special promotions
Bank of New York, the oldest bank in the country, is for a limited
time offering "Free Checking for Life." In the first six
weeks of the promotion, the 220-year-old bank saw a 50-percent to
75-percent hike in customers coming into the branches to take advantage
of the offer, according to Gregory Fusilli, a senior vice president
at the institution.
"It's my general feeling that in the last couple
of years, minimally, the customer is looking for some type of free
checking offer (up to) a commitment like the one we're making of
free for life.
"I sense confusion in the marketplace with big
bank names changing every year, new pricing schedules. Customers
wonder if they're paying for online banking, are they paying for
checks? We want to eliminate some of those mysteries."
Florida's BankAtlantic is growing rapidly, touting
itself as Florida's most convenient bank. Branches are open seven
days a week and customers are signing up in droves for its "Totally
Free Checking."
While there's little doubt that free checking is a
cornerstone of the bank's success, CEO Alan Levan says it's just
part of a comprehensive strategy to get customers in the door.
"Free checking isn't the primary reason people
bank at BankAtlantic; it's convenience. I don't think we'd be successful
with just the free-checking product. We have dozens of products
and services that turn heads. It's an expensive program, costing
us in excess of $10 million a year. Free checking isn't included
in the $10 million. It's hard to calculate how much we're giving
up in free checking."
When applying for free checking, be sure to ask for
a printed copy of the bank's fee schedule, and read everything else
the bank gives or sends you.
"Free is not the 'free' in Webster's dictionary,"
Moebs says. "Ask, 'What do you mean by free? Are there any
fees?' Look for conditions such as direct deposit. Can I get what
I want without these conditions? Then shop, shop, shop. Find the
names of the banks where you think you'd like to go and go to their
Web sites to find out more. Web sites have gotten much better in
the past couple of years explaining what's going on."
Bankrate.com continually updates fees, balance requirements
and other data on hundreds of checking accounts across the nation.
Visit Bankrate's "Check
the rates in your state" page when shopping for a checking
account.
|
