Browsing Category: Banking

Ask The Expert: Which Is Better? Bank Or Credit Union?

Question: My boyfriend and I are talking about marriage. We’ve taken your advice and had several very honest conversations about money, since we know finances are a big cause of fights. We’ve settled a lot of things, but we have this weird sticking point: My boyfriend insists I get rid of my Bank of America account and sign up with his credit union.

My boyfriend really really hate “big banks,” although it’s not like any of these banks did anything to him — he’s been with his credit union forever. (His dad was in the Army, so he’s with PenFed.) I don’t mind opening another account, but I like that Bank of America has ATMs and branches everywhere. While this won’t break us up, it really is the biggest fight we’ve ever had. What do I do?

— Katey in Arizona

Howard Dvorkin CPA answers…

In my 20-plus years as a CPA and financial counselor, I’ve met with many couples whose relationships were stretched thin by money fights. I must admit, however, I’ve never seen a couple argue over Bank of America.

First, let me acknowledge you both make some excellent points…

  • PenFed is an excellent credit union. In fact, it offers one of the nation’s best credit cards. Earlier this year, Debt.com called it “the credit card for people who hate credit cards,” since it imposes no fees whatsoever.
  • Bank of America isn’t an evil empire. I know many people who are quite happy with big banks. Debt.com editor Michael Koretzky has his mortgage there because it actually worked out to be the best deal at that moment.

With that said, your boyfriend needs to learn how to compromise.

In matters of love and money, I’ve learned this from counseling more couples than I can even count: It’s not about complete agreement on the details, it’s about philosophical agreement on how to save and spend.

Your boyfriend is doing you a favor by encouraging you to join his excellent credit union. Just the other day, I was reading a new study called the Credit Union Satisfaction Index 2015. The biggest finding: 90 percent of credit union customers are satisfied with the overall service. That’s high for any industry, but it’s actually up one point from 2014.

Meanwhile, banks rated only a 782 out of 1,000, according to JD Power. That translates into just over 78 percent.

Still, pressuring you to leave Bank of America isn’t a sound decision financially or emotionally. If you’re in the 78 percent, and if you’re not paying fees to Bank of America to keep your account there, this episode is a good lesson in more than money. It reveals how your relationship will proceed on all kinds of issues where you two differ.

You’re offering a healthy compromise by moving some of your money into PenFed. If your boyfriend wants to convince you to move the rest, the best way to do that is to put your money where his mouth is:

Prove over the course of a year just how much money you saved and made by making the switch. If that adds up, you sound like a smart enough women, Katy, to make an objective decision.

This article by Howard Dvorkin first appeared on www.debt.com and was distributed by the Personal Finance Syndication Network.

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Bank Scams and Fraud: What You Should Know

Portrait of a depressed young businessmanTo protect yourself from bank fraud, you should understand it in its simplicity and complexity. Since bank fraud can apply to any machinations of financial institutions or any scam that besets them, the exact modality of bank fraud can be incredibly complex. Let’s examine two examples of bank fraud and how you can protect yourself.

Bank Fraud by Banks

What is bank fraud? By in large, financial institutions are honest, and law abiding, but when they do decide to break the rules, the consequences can be monetarily staggering. One of the most infamous bank frauds in history was uncovered in 1991 when the Bank of Credit and Commerce International (BCCI) was raided to find about $10-$17 billion in fraudulent activities.

The fraud took place over a couple decades and used an intricate, international web of banks and shell companies that created subterfuge for their misdealing. BCCI used dubious lending, fake records, rogue trading, unregulated risk management, money laundering, and illegal contracts.

BCCI’s fraud, as large scale as it was, pales in comparison to the recent LIBOR (London inter-bank offered rate) banking scandal. This scandal, revealed in the spring of 2012, is further reaching than other bank frauds because LIBOR is used to setting interest rates on more than $800 trillion dollars — giving it global significance in the finance industry. Employees at Barclays Bank are accused of working in collusion with LIBOR officials to set the rate so that they could make short-term gains on trades they had made in the market. The resolution of this bank fraud will be tied up in the courts for years to come, but with more than 20 different banks, that lost billions of dollars, cleaning up this mess will be long term.

Unfortunately, for the average consumer, there’s not much to be done to prevent bank fraud perpetrated by banks. The best thing to do is research your financial institutions history of bank fraud, keep your own bank records, report any suspicious bank dealings to authorities, and know your rights in dealing with fraudulent banks.

Bank Fraud by Scammers

Banks as institutions are defrauded when someone or an entity purposely misrepresent themselves (through identity theft or forged documents) to obtain funds from the bank. Although security measures have improved over the years, crooks and scammers also continue to refine their methods to keep up. As a consumer, the number one way for you to protect yourself and your bank from bank fraud is to safeguard your personal information.

Crooks and scammers surreptitiously gather confidential consumer information to commit this type of bank fraud, from phishing and ATM skimming to online shopping and file sharing. Plus there are a litany of ways fraudsters can use your information once they’ve obtained it, all of them costly to the bank and possibly your accounts.

Never give your personal information to someone or a website that can’t confirm its identity and credibility.

Capital One 360’s 5th Annual Black Friday Sale

savings account

For those looking at getting a better deal with their checking and savings account,  you may want to check out CapitalOne 360. CapitalOne 360  is giving new customers big bonuses when you open up a new account with them from November 29th 12:01 AM ET through December 2nd at 11:59 PM ET.

$125 Bonus for 360 checking Account!

Now you can have a great checking account and a nice little buffer to start it off. We’ve had our checking account with them for years and have been happy with their service.

Open a fee-free 360 Checking account between November 29th and December 2nd and grab a $125 bonus.

savings account
Where you park your savings can have a big influence on your net worth
  • This has to be your first 360 Checking account.
  • Make a total of 5 debit card purchases (either signature or PIN-based) or 5 CheckMate deposits (or any combination of the two) within 45 days, and your $125 bonus will be automatically deposited into your account on day 50

Customers will earn interest on their everyday cash. APYs are effective 11/29/2013.

  • 0.20% Balances under $50,000
  • 0.80% Balances between $50,000 and $99,999.99
  • 0.85% Balances of $100,000 and more

Besides the bonus, there some other great features with their checking account.

  • No monthly maintenance fee
  • $0 required minimum balance
  • Free online billPay service
  • Conveniently located ATMs
  • Earn some interest rate if possible

If you want to open a checking account with Capital One 360, simply click here to get started and get a $125 bonus!

$75 Bonus for 360 Savings!

If you want to get your cash reserves a bump,

Open a no-fee 360 Savings account between November 29th and December 2nd and snag $75.

  • This has to be your first 360 Savings (including Orange Savings Accounts) account and it needs a $500 minimum initial deposit or more.
  • The bonus starts earning interest on day 1, but you can’t take it out for at least 30 days.
  • The variable Annual Percentage Yield (APY) is 0.75%, effective 11/29/2013.

If you want to open a savings account with Capital One 360, simply click here to get started and get a $75 bonus!