Nigerian Scam.

Some people still live under rocks as this story about a county treasurer shows. If you get a email or letter from a dethroned prince from another country with lots of money to put in your care. Run the other way.

Systematic Savings

The United States has one of the lowest rates of saving money in the world. Our buy now pay later style of living has put many of us in the hole. Having a cash savings account that we can fall back on can be a huge benefit if our financial situation takes a turn for the worse. Many people feel that do not have the financial resources to start a savings account. Some people start a savings program then use the savings for a purchase of fun things instead of emergency items. One way to achieve a cash reserve is to systematically put money into a savings account set aside strictly for emergency purposes. Many banks and other financial institutions will allow as little as $25.00 a month transferred automatically into another account. The more ambitious you are the more money you could transfer. If you do $50.00 a month that is $600.00 a year. Some might think this isn't much, but if you can do this for a few years you could have a nice nest egg to fall back on in times of need. Having a saving plan is a sure step on the way to financial security. If you have to give up a few things to start this plan, do it. It will be worth it.

Is my check local?

One of the most confusing things in banking is how fast your deposits become available to use. Local vs Non-local checks is not as straight forward as you think. Local means that the bank that the check was written on is in the same Federal Reserve Zone as the bank receiving the check. So a local check could be from another state. At the bottom of your personal check is a set of nine numbers (not the account number). This number is unique to your bank, like a bank serial number. It is good to familiarize yourself with your banks number. Once you know that you can identify which checks are not in your Federal Reserve Zone and possible delays of funds availability. Here is a great link with some details on the numbering system.

Depositing To ATM's

ATM's (automatic teller machines) have become a major channel for banking. They truly are a marvel. They usually work and work correctly. You can put money in and take money out. You can transfer money between accounts and buy stamps. There is, however, a major difference in the way your transaction is processed. A deposit to an ATM is recorded in the computer system when you do it, but the actual processing of the deposit may not happen until the next day. Here is an example. You are coming home from work after you bank branch has closed. You have checks that need to be deposited. The ATM is right there so you fill out the envelope and push the appropriate buttons and stuff your envelope into the slot. Great! your deposit is done and you are on your way. Well, sort of. You see the deposit will not be taken from the ATM until the next day. Some times it is done by branch personnel and sometimes it is pickup up by another department or service provider. That means there is a delay in your deposit getting into your account. Branch personnel or the pick-up service will take that deposit and process it the next day. That means that any checks or debits that come through your account that night will not be covered. Additionally you have to take into consideration holds or check aging. If the bank holds all local deposits for 24hrs then that delays your deposit even more. Another consideration is the size of the deposit. Banks can delay the availability of deposits if they have reason to believe there is additional risk. I once had a person bring in a personal check written in three different color inks without a payee listed. Danger, danger, danger. I would not take the check. The moral to the story is whenever possible make your deposits with a teller. It is faster and more efficient. Here is a situation that you may find interesting. I once had a customer call and say that a deposit she had made in our ATM has not shown in her account. Of course I was sceptical. I have heard that story many times, but the customer seemed sincere and I wanted to make sure I did all I could to find her deposit. Each deposit that is made into an ATM is imprinted with information to identify the deposit. We verified that each deposit that was recorded by the ATM was accounted for. Nothing was missing according to the ATM records. We opened the machine and looked everywhere, pulled out the hoppers and dismantled the machine as much as possible. Nothing. We took one more look and I looked into the front of the machine and I could see a crumpled envelope. It was stuck under the conveyor that takes the deposit envelope and prints on it. The didn't let the machine take the envelope, but crammed it in the slot herself before the machine had a chance to take it.

Overdraft Protection

We live in a fast paced world. Many times we end up our days counting the things we didn't get done. One of those things could be the accounting of our finances. So we choose taking Rudy to daycare and we will enter the check we just wrote for the dry cleaning later. Oh, we always remember later. We remember when we get the Overdraft Notice. The ideal situation is to write in each check and debit in as we do them, but we don't live in an ideal world. So there is Overdraft Protection. It comes in many forms. It could be an automatic transfer from a savings account, a special line of credit or a charge to your credit card. These could all have charges connected with them, but generally not as expensive as the Overdraft Charge without any protection. Overdraft Charges could be up to $36.00 per item. That can get very expensive. A line of credit could have a high rate on it, but 18% on $100 is only $19 if you carried the balance for an entire year. The bank will, of course, make you pay it back sooner than that. The overdraft from a savings account will, most likely, have a per transfer fee attached to it. The credit card will also have interest charges as well. Some banks will charge an annual fee for the privledge of having Overdraft Protection, but in the long run you will be better off having it available. I once had a customer that had an overdraft that was covered by overdraft protection. She claimed she had never signed up for it and wanted it cancelled, because she doesn't overdraft. She accepted the lower charge, though.

Read The Fine Print.

Have you ever opened a "Free Account" only to find out later that you have been charged? Always read the fine print. Many banks use promotional rates to bring in new customers, but there are strings attached. You get a good rate or a free account, but there are certain criteria that you must abide by. You may be required to open another companion account and keep a minimum balance. Direct deposit may be another. I remember opening Money Market accounts that had a fixed rate for 6 months, but required you to keep a minimum balance for 270 days. The rate, of course, returned to current market rates after the 6 months which was almost always lower and you paid a closing fee if you closed before the 270th day. So the great rate you received for the first 180 days is not so great once you average it out over the 270 days. There are other types of requirements as well. The list of things to look out for could include, direct deposit, additional accounts, regular usage, minimum or maximum balances and minimum time requirements. All this is acceptable if you are aware of it. Read the fine print on the flyers and ask lots of questions.

Fraud, Watch Out For Yourself!

One of my most frustrating jobs in banking was tracking down fraud. Fraudsters work night and day to find ways to steal money. It is inevitable that these criminals will have some success. The most aggravating for me was the fraud that the customers made possible by neglect. You have to be aware of your surroundings and keep track of your financial instruments. Here are some examples of neglect. "I was in the restaurant and put my purse on the floor and someone stole it. My credit and debit cards, checks and I.D. was in it". The experienced criminal would be using those items within minutes because he/she knows the accounts will be locked, stopped, closed or frozen within a short time. How about "I lost my debit card somewhere. I don't know where. I had it yesterday". I know that in this day and age people rushed and spread very thin. Many banks have a zero liability policy when it comes to fraud. So you will eventually get your money back in many cases,but it could be weeks depending on the complexity of the case. Most retailers don't check I.D. when accepting debit cards or credit cards. Debit cards can be used like a credit card and only require a signature. Let's face it cashiers are not handwriting experts and are not likely to dispute a customers signature. Remember false Identification abounds. I have seen people sign their credit card slips with fictitious names just to prove a point. No one ever questions the signature.