Banking

[TimeAsylums]

How does one choose(decide) a Bank/Credit Union?

lel

no, but seriously

 

[Cavallier]

It depends on what you are wanting to do with the account. I hate banks but I am able to have a credit card through mine more easily than through my credit union. The credit union usually costs less. They are generally smaller and more localized. However, they often provide less customer support if something goes wrong.

For example: When my debit card was comprimised with Wells Fargo they noticed before I did (within an hour) and cancelled my card, sent me a new one, and I had no negative repercussions from the incident. When the same thing happened at my credit union it took them 3 days and I had to eat the cost of the lost money.

However, the draw back of a bank is the constantly changing fees and fines. My credit union basically never bothers me to update accounts or get new ones. My bank forces me to change up my accounts almost yearly in order to avoid fees.

I prefer credit unions because they are smaller and I generally have less negative experiences with them. However, since I am traveling a lot and I need national and often international support I have a bank account.

 

[Analyzer]

Don't need banks just keep cash under the mattress, precious metals, and some bitcoin. If necessary purchase pre-paid cards with your cash.

 

[Cognisant]

It helps to live in a country with multiple competing banks, I've had an account with one bank for ages, they charge me an account keeping fee and $2 if I use the wrong ATM, that's it.

Mind you it's a debit account and whenever I save up a bit of money they start pestering me about getting a credit card.

 

[Roffel]

I live in Switzerland, so the question seems odd to me. Choose a bank that has ATMs or even a branch near you. However, most of your banking will probably happen online (most convenient). There may be large differences in fees, e.g. for receipts, transactions, credit cards etc.

Of course, things only really get serious once you own/owe a big chunk of money, e.g. if you invest in stocks or loan to build a house. Since banks operate on very strict rules, there shouldn't be any surprises as long as you inform yourself beforehand (fees are usually not found right on the front page but buried someplace) and maybe even read some of the fine print (hint: if something goes wrong, you take the risk, not the bank).

 

[Cavallier]

TimeAsylums is in the States. And his question here has some serious merit. There are a number of key differences between banks and credit unions in our country.

Often, it comes down to your economic level. If you don't have a lot of money the credit unions traditionally are more lenient and less expensive. They do not make you hop through as many hoops and often you can keep an account open even if you only have $5 in it. However, even if you have loads of money they don't have a lot of quality incentives to keep you as a client.

If you have a lot of money the banks start giving you lots of benefits and work hard to keep you but if you have no large amount of money they don't care about you as a client. If you don't have a certain base level amount of money in your account they charge you fees and compound those fees for each month you are below the base level of money. They often won't let you have a debit card account without a linked savings account. Then they charge you a fee if you don't transfer a certain pre-set amount of money into the savings account from the debit account. Often if you don't have a certain number of transactions over the course of a month on your debit card account they will charge you a fee. They have lots of rules and most of them are designed to keep you paying them fees. Often these rules will behoove you if you are wealthy enough but end up being costly hurdles if you are not.

 

[EditorOne]

What Cavallier said.
Additionally, credit unions seem to be more aware of account irregularities than even a couple of years ago. We recently broke our pattern of spending with a large (OK, four figures, for me that's large) purchase from a vendor we hadn't used before. The credit union called us and asked if it should go through. We heeded that; before a long trip to another state, where we expected to make quite a few out-of-pattern purchases, I called them ahead of time to alert them. No problem, they got it, knew what I meant, and put a notation on the account to expect "odd" things until a certain date.
This is a really small credit union, by the way, and they are fast and savvy and consumer-oriented.

What put us off regular banks, the final insult, was the practice of triggering multiple fines and fees by ordering check payouts by size. If you've been running close to the edge (I'm assuming I'm not the only one in that position from time to time) and goof it up, it's worse if the bank opts to pay out the biggest one first, meaning five or six in a row after that might be "overdrawn" and each one involves a separate penalty. It's like house odds in a casino: Sooner or later that practice pays off for them, whereas paying out checks and debits in any other order eventually benefits the customer by avoiding multiple overdrafts. So screw them.

 

[Cavallier]

What Cavallier said.
Additionally, credit unions seem to be more aware of account irregularities than even a couple of years ago. We recently broke our pattern of spending with a large (OK, four figures, for me that's large) purchase from a vendor we hadn't used before. The credit union called us and asked if it should go through. We heeded that; before a long trip to another state, where we expected to make quite a few out-of-pattern purchases, I called them ahead of time to alert them. No problem, they got it, knew what I meant, and put a notation on the account to expect "odd" things until a certain date.
This is a really small credit union, by the way, and they are fast and savvy and consumer-oriented.

Interesting. It could be the entire security system has improved. I've had accounts with many little credit unions. Some were good and some were not great but even the worst ones were less of a hassle than any bank I've dealt with. I'm with a bank now because when I married my husband he had a grandfathered in account from his paternal side that gave good enough benefits to roll my paltry accounts into it. I really hate that bank though. I'm gunning to shut down the accounts and go back to a credit union.

 

[TimeAsylums]

I appreciate all the input

Been looking around online and r/financing/banking/CU

now looking at those "only online" banks too...

It seemingly doesn't make a difference with my small income, just probably the one with the fewest charges/fees

 

[scenefinale]

https://www.google.com/compare/creditcard/qs#p=0

 

[Red myst]

I appreciate all the input

Been looking around online and r/financing/banking/CU

now looking at those "only online" banks too...

It seemingly doesn't make a difference with my small income, just probably the one with the fewest charges/fees

why do you want a bank account? It can be a good idea or a bad one depending on your spending habits. If you have poor spending habits you can rack up a lot of overdraft fees. If you are going to do the "only online" ones, than I am assuming you are going to do electronic deposit? Direct depositing your income can be very handy. And a useful tool because you can track your debit card spending and analyze where your money goes. I don't have a specific bank to recommend, but I know that overdraft fees are by far worse than the other typical fees the bank charges. I know people who live paycheck to paycheck and are always fretting about their balance. And despite all the worrying, the still bet hit with overdraft fees. Its not the banks fault. They are impulse spenders and are always cutting it too close. I told them they should not even worry about having a bank account, but they say if they don't put it in the bank, they would blow it all sooner.

 

[TimeAsylums]

why do you want a bank account?

<shrug>

saving up

 

[Red myst]

<shrug>

saving up

Oh, ok so that is different. Banks are good for keeping your bill paying money in, and I guess keeping emergancy funds in, but for actually saving money, I think regularly contributing a modest sum of money in an investment like a no load mutual fund is the best way to go. The earlier you start doing this, the less you have to put in on a regular basis in order to have a decent lump sum over time.

 

[EyeSeeCold]

It seemingly doesn't make a difference with my small income, just probably the one with the fewest charges/fees

Pretty much. Ask around though and see what other people have in your area.

Some things to watch for:

• Involuntary 'overdraft protection' fee
• Low balance fee
• Savings-Checking transfer fee
• Service fees
• ATM fees
• ATM accessibility
• Withdraw/deposit policies

Go for:

• Online statements
• Minimum balance > Service fee