Posts From August, 2012

Check Out Video from MSN on Earning More on Your Savings 

August 28, 2012 Categories: saving tips

MSN recently posted a video that details how to earn more on your savings. Because interest rates are at record lows, earning more from your savings has never been more important. The tips outlined in the video and subsequent article may help you get more out of your hard earned money.

To view the video click here.

To read the article click here.

Debunking the ‘Disadvantages’ of Credit Unions 

August 23, 2012 Categories: bank alternatives

U.S. News & World Report recently posted a blog article by MyBankTracker attempting to list some of the “shortcomings” of America’s credit unions.

The blogger first addresses the number of locations that credit unions operate versus banks—over 95,000 bank branches versus only over 7,000 credit union branches. The blog post fails to mention however that credit unions operate the fourth largest branch network in the world with their shared branching platform (being able to use a variety of credit union branches as if you were at your home credit union). While credit unions may operate fewer branches than the nation’s banks, their shared network of branches only falls short of Wells Fargo, Bank of America and Chase/WaMu. I would say that this makes them just as convenient as many of the country’s regional banks.

The second disadvantage: while credit unions offer more personal service, they don’t have the ability to provide as much reach as the nation’s banks. Call centers are commonplace for banks, but aren’t necessarily standard practice for credit unions. While many credit unions are utilizing outside companies to handle off-hour communications, some still operate on “bankers’ hours”. When choosing a credit union, it is important to consider the availability of member service reps, but the issue should not push to you the arms of a bank. Most credit unions have an array of technology offerings that give you account access 24 hours a day. How often are you calling a member service representative after hours with all that you can get done online today? If it is vital to you, simply choose a credit union that offers a more robust member service hours, or an off-hours call center. They are certainly out there.

Thirdly, the blog points out the technological ineptness of credit unions. An article on Bankrate.com from 2002 outlines how far ahead technologically credit unions are from banks, “leading the way” in advancements. The road to online banking and electronic tellers was paved by credit unions, banks did not adopt much of this technology until recently. The Bankrate article highlights that because credit unions can't afford the large staffs that banks can, technology becomes more important to them to create efficiencies for their members.

The final disadvantage highlighted in the article is the lack of financial advice provided by credit unions. With all the financial literacy education credit unions provide to not just members, but their communities at-large, as well as the loan counseling provided to members and the overall philosophy of “people helping people”, how could anyone claim that credit unions don’t provide enough financial advice?

These days many credit unions have on-staff certified financial counselors and those that don’t often have staff members who can provide advice and informal counsel on particular issues. Still others work with outside consultants that offer advice on insurance products, investing and more.

The article culminates with the idea that two financial institutions are better than one and that for many consumers having both a credit union and a bank account might be the “best of both worlds”. We say, join two different credit unions and enjoy better rates and lower fees.

Account Fees are on the Rise According to Recent Study 

August 21, 2012 Categories: fees

According to a recent study by MoneyRates.com, bank fees are on the rise again. At the end of 2011, consumers saw a brief decline in fees due to the prevalent anti-bank sentiment surrounding Bank Transfer Day and Occupy Wall Street protests. Now that the anger has mellowed a bit, banks have taken the opportunity to increase fees.

The study showed that on average, monthly maintenance, ATM and overdraft fees all increased. Maintenance fees rose to an average $12.08, up from $11.28; at large banks, they rose to $13.88. Meanwhile the average minimum balance required to avoid that fee jumped by $850 to $4,500.

Only about 35% of the accounts surveyed didn't include a monthly fee, down from nearly 39% in the last survey.

The survey showed that banks are charging more for non-customers to use their ATMs as well s for their customers to use ATMs that aren't in their network. Using a foreign ATM will now cost you an average of $3.68—close to 20% if you are taking out $20.

A better option for lower fees, or even no fees, are one of the many credit unions located throughout the country, and even the world. Use our locator to find a credit union for you.

To read the entire survey report, click here.

Study Shows Free Checking Available at 72% of Large Credit Unions, 45% of Banks 

August 14, 2012 Categories: bank alternatives checking fees

A recent Bankrate.com survey showed that roughly 72% of the nation’s largest credit unions offer free checking accounts without a minimum balance requirement. That compares with 45% of banks.

The percentage is down slightly from last year’s 76%.

Bankrate.com’s 2012 Credit Union Checking Survey also showed that 10% of credit unions surveyed will waive monthly fees if account holders maintain a minimum balance ranging from $100 to $750.

"Only 45% of banks offer checking without a minimum," said the study, adding, "and their minimum balance requirements tend to be much higher--$585 for noninterest bearing accounts and a staggering $5,587 for interest checking accounts."

"Overall, 98% of the credit union checking accounts that we surveyed are either free or can become free if the accountholder meets minimum balance, direct deposit and/or e-statement requirements," said Greg McBride, Bankrate.com senior financial analyst. "So credit unions remain a viable, consumer-friendly alternative for finding a free checking account."

Most (68%) credit union checking accounts in the survey do not pay interest, Bankrate noted. Those that do yield an average of 0.12%, down from 0.17% last year, which is consistent with the ongoing declines seen in cash investments, the publisher said.

Other fees noted in the survey:

  • Credit unions consistently charge less in overdraft fees for nonsufficient funds. The average cost of the first overdraft at credit unions is up slightly, to $26.65 from last year's $26.05, compared to $30.83 at banks. The most common fees assessed at credit unions are $25 and $30, compared to the most common fee of $35 at banks.
  • Thirty percent of credit unions surveyed have either no ATM fees outside the network or provide at least one free withdrawal per week before the fee kicks in. That compares to 29% at banks.
  • Ninety-six percent of credit unions will charge a non-member for using their ATM. This year's average surcharge is $2.08, down from $2.10 last year. At bank-owned ATMs, the average surcharge is $2.40.  Credit unions' most common surcharge is $2, compared with $3 at banks.

Consumer Union Survey Reveals One in Five Bank Customers Have Considered Switching this Year 

August 08, 2012 Categories: bank alternatives

One in five banking customers have considered switching financial institutions in the past year, according to a recent Consumers Union survey.

When asked their top reasons for considering a switch, the most common responses from the 1,157 people surveyed were:

  • Unexpected fee increases (43%)
  • Better terms elsewhere (38%)
  • Poor service (26%)

The survey also asked reasons why customers ended up not switching financial institutions. Below were the most common responses:

  • The hassle of transferring automatic payments and deposits (63%)
  • Too much time and effort (37%)
  • Fees to transfer the money (28%)

The Huffington Post has reported that based on the survey, Consumers Union is demanding that the Consumer Financial Protection Bureau make some policy changes. These include forcing banks to allow free same-day electronic fund transfers and automatically transferring the customer's automated payments and deposits within two weeks.

If you aren't ready to wait for those changes, they offer some great instructions on "How to Break Up with Your Bank".

Credit Union Deposits Outpace Banks According to SNL Financial Study 

August 07, 2012 Categories: bank alternatives

 

According to a recent study by financial research firm SNL Financial, customers were steadily moving their money out of banks and into credit unions long before Occupy Wall Street protests and Bank Transfer Day. 

The study shows that deposits at the biggest credit unions have grown faster than those at the biggest banks since the beginning of the financial crisis. Since 2008, deposits at credit unions have risen 43% compared to a 31% increase at the biggest banks. 

The collapse of Washington Mutual and its purchase by JPMorgan Chase in 2008, and Wells Fargo's acquisition of Wachovia kicked off an increase in deposits at credit unions, the survey said. Deposits at credit unions spiked again last fall, when Bank of America tried to add a monthly $5 fee to use its debit cards, according to the report.

An article on the Huffington Post Web site last week highlighted some of the changes big banks are making that will draw more consumers to credit unions and community banks. However, the article also notes that small and mid-size banks are closing their doors as they struggle with low interest rates and weak loan demand, as well as compliance costs for regulations. 

The article highlights McGraw Hill FCU's latest video campaign asking potential customers to make video testimonials about their big bank departure in a program dubbed "We Hear You". 

To read the recent survey by SNL Financial visit http://www.snl.com/InteractiveX/Article.aspx?cdid=A-15299504-13097

To read the Huffington Post article in its entirety visit: http://www.huffingtonpost.com/2012/08/02/credit-union-deposits_n_1733448.html?view=print&comm_ref=false

To see McGraw Hill FCU's video campaign visit http://www.mcgrawhillfcu.org/home/facebook/videocontest

Understanding Fees: What You Need to Consider When Making Decisions 

August 02, 2012 Categories: fees

Mary Johnson recently posted a blog article on the Huffington Post blog site outlining some things to consider about fees and policies when making decisions about your finances. She lists things to consider and notes that you should review your needs and priorities when making decisions about the right financial institution for your hard-earned dollars. Her tips are tricks are sure to help anyone, even if it just makes you think about how you are currently managing your money and your financial relationships. To read the article click here.

 
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