After so many changes in the banking industry during the past several years, it can be tough to sort through today’s array of online offerings, fees and checking accounts.
“There’s such a big difference in banks out there,” says Kellie England, senior vice president of Umpqua Bank in the Sacramento, California, area. While some banks focus on getting to know customers, others tout online banking and mobile banking technology as their best traits. These choices can make it difficult to get a true picture of what banking today involves.
Here, experts debunk commonly held beliefs about banking. Read on to learn the truth behind these myths and get a better grip on your current checking account situation.
Bank fees may not be increasing for everyone. In fact, 38 percent of respondents said they have no fees or are uncertain about any fees associated with their primary checking account, according to the 2013 Bankrate Checking Survey released in September 2013.
The fee that banks charge non-customers to use their ATMs has risen by nearly a third since 2008, according to Bankrate’s study. And the average overdraft fee was $32.20 — up almost $1 over the 2012 average of $31.26.
But, “most of the time there are ways to avoid fees,” England says.
Signing up for email alerts about your balance could help you steer clear of overdraft fees. To cut other fees, look into the banking options available. Say you often travel and need to withdraw cash from ATMs that aren’t in your bank’s network. You might be able to switch to an account that waives ATM fees or allows you to increase your withdrawal limit to save on overall costs.
When evaluating bank fees, “think about the value of what you are getting,” says Lindsay Sacknoff, senior vice president of retail deposit products and pricing at TD Bank. Perhaps your bank offers longer store hours, mobile deposit options, online banking and email notifications. You might decide it’s worth paying the monthly fees in exchange for the benefits you receive.
National banks insure customer deposits with insurance from the Federal Deposit Insurance Corp. While some community banks are FDIC-insured, others are backed by state insurance funds.
Credit unions have insurance through the National Credit Union Share Insurance Fund, a government-backed insurance fund for credit union deposits.
In the doorway of your credit union branch, look for a blue sticker, says Patrick Keefe, senior vice president of communications at the Credit Union National Association. The symbol will indicate the organization is insured.
To learn more about your bank’s insurance and financial health, visit its website or ask at the local branch. Regardless of the bank size, you’ll want to make sure your money is kept how it should be — safe and sound.
Online banking is convenient, but there are times when it might be best to step foot inside your local branch. This is especially true for anything that’s not straightforward, England says. Say you want to set up a trust or help an aging relative manage an account. Sitting down with someone can make it easier to understand the process and work through the various steps involved.
When seeking help, younger customers are especially eager to reach a live person. About 54 percent of Americans between the ages of 18 and 34 said they go to their bank branch for information on financial products and services, according to the TD Bank Financial Education Survey released in March 2014.
Even for general banking needs, “taking the time to have that conversation with a person can be meaningful,” Sacknoff says. For instance, by sitting down with a representative, you might learn you can get a discount on your mortgage if you set it up in the same bank where you have a checking account.
“While larger banks are more likely to create custom technology for their online banking and mobile banking … we can provide essentially the same state-of-the-art services in a timely manner,” says Edward Manzi Jr., chairman and CEO of Fidelity Bank, a community bank based in Leominster, Massachusetts.
Recently, Fidelity Bank was able to launch mobile banking and mobile deposit before two of its largest regional competitors, Manzi says.
If you’re not sure what your bank offers or you are considering switching banks, take some time to look into the technology available. You may be surprised at the number of tech-friendly perks your community bank or credit union provides.
Furthermore, when a crisis hits, you might appreciate the personal touch a smaller institution can offer. For instance, after the recent Target breach, “we were able to call each and every one of our clients to tell them how they were affected,” Manzi says.
Features like direct deposit, automated billing and online monthly statements can help streamline your banking needs. However, if you’re not vigilant, you might not catch bank errors. And that’s not all. Fraudulent activity could take place unnoticed on your account.
The number of identity fraud victims increased by 500,000 consumers to 13.1 million people in 2013, according to Javelin Strategy & Research in Pleasanton, California. This amounts to a new identity-fraud victim every two seconds.
Losses resulting from fraud are distributed proportionately between the bank and the customer, says Denis G. Kelly, CEO of IDCuffs.com, a site that offers identity theft services. If you don’t report the fraud in a reasonable time, you could face liability for the losses.
To keep your checking account safe, “review your account activity on a weekly basis,” Kelly says. Check that all bank fees are accurate. And if you spot a transaction you didn’t authorize, notify your bank immediately.