Some of our friends told us last week that a new bank just opened in our town, offering 4% interest on checking accounts. Our checking account is currently earning about 1%.
There are several requirements (of course!), including having a monthly bill pay or direct deposit, and using the debit card twelve times a month.
We currently put virtually everything on our credit card in order to maximize our airline rewards, so this would mean making a concerted effort to use the debit card 12 times a month (I can just see myself buying twelve bananas, one at a time).
Basically, we would need to switch over entirely from ING because without having direct deposit and our checking account there, it wouldn't be feasible to make purchases from that account, and if our savings and emergency funds aren't there, we won't be making enough money to make it worth switching.
Normally, I am willing to jump through a lot of hoops to make or save money, but this one seems like a lot of effort and some major changes to our banking system. Especially when it is very probable that in a year or so, their interest rates will drop significantly. I'm kind of at an impasse on this one right. . .
What do you think?
10 comments:
Until we have a LOT more money in our bank account, this just doesn't seem worth it. But I might consider looking into checking account interest rates when we move in about a year and we're hopefully making that lot more money.
Very carefully look at the fine print for penalties, fees, etc.
Stick with what you have. Really. You do things for a reason. Having to pay for plane tickets would cost more than the few extra $$ you'd earn.
Not worth it. Do you like the customer service at your current bank? Sometimes it's also good to be frugal about your time and effort (as in, don't expend a ton of it).
I am always super skeptical of things like this... especially if there are a lot of hoops that might get overlooked one busy month or another.
If you were unhappy with your current banking system and interested in making changes... then this might be a perfect new fit, but if you are already happy and getting good benefits, I would be very hesitant to even take the effort to read the fine print.
I LOVE that you can create subaccounts with ING. That alone keeps my savings there (the formerly high interest rates are what got me there in the first place). Since I use a debit card for almost all of my purchases, my checking account is at another online bank that gives me 1-5% back on my purchases.
I don't chase interest rates, but I'm certainly not above making changes when they benefit me and make my life easier.
skip it. Too involved and easy to miss.
My husband can have his paycheck deposited into like 25 different accounts. Setting up one more really isn't a big deal to me. I'm sure your husband can do that even Ken's little start-up would let us do 3 different accounts. I bet an EFT from your ING accounts would probably count as direct deposit too (we have done that in the past to get around some bank fees) I would still keep the ING ones open though too since you have a good system with them.
And you can go and buy your 12 whatevers on the first of every month and keep on doing the system that has worked for you. Personally, I get a kick out of stuff like that especially if I know that 20 minutes in the self-checkout line is earning me $25 (for 10k), $37.5 (15k) or $50 (for 20k) each and every month!
I wouldn't turn down $30 each month for 30 minutes of work. Even if I had to drag all 4 of my kids to the store each time I did it. Actually, I would probably take them on purpose because they would think it was the funnest thing!
PS- Can I get the name of the bank? I totally want to do it!
I worked in banking for 5 years and I would be wary of this one.
In times of financial crisis it is really important to make sure your money is in a bank with security rather than a bank offering perks. If they are offering perks it often means that they are needing to gather customers fast in order to get themselves back on their feet.
I always encourage people to keep their money in one of the major banks and look for one that has a government guarentee.
1%? that is crazy talk. New Zealand is finally hitting the 5% mark after some big lows with interest rates.
I would continue to earn your airpoints as they probably have a higher value.
Its a tough one tho and worth sitting down and working through but remember SECURITY first =)
I like Stephanie T's point about how much money you can earn per month just by standing in the self-checkout for a few extra minutes. I also bet you could do some percentage of Bart's pay into each bank account. I don't see why a very large company like the one he works for wouldn't offer that.
With all that said, I would first make sure you have a 100% understanding of all the hoops before going into it. And you'd have to decide what dollar amount is worth your time to go through the hassle. $10 per month? $40? That is ultimately up to you (obviously).
Definitely not worth it. They have high interest rates now but it is a special... the rates will probably only last a short time and then you'll have done all of your work for a couple of dollars and 12 rotten bananas.
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