What do most people think of when you mention their bank? Images of a friendly local teller, free hot coffee in the mornings, or their safety deposit boxes. We suggest that these images are just a front for a cold calculating money-making machine that couldn’t care less about the financial futures of your family, and would take every last dime you have for their own overflowing coffers if they could find a way to do it legally. Your bank isn’t doing you any favors, believe me. What’s wrong with my bank, you might ask. I’m glad you asked – let’s get down to the nitty gritty.
My Bank Is Just Holding My Money For Me
Is that what you think your bank is doing – just holding your money for you? Think again. They have taken your money, and are either paying you a miniscule .05% (if anything at all) on your money, and they’ve given it to someone else to borrow, probably at a rate between 5% and 29%. So already they are making money hand-over-fist just by lending out the money you gave them in good faith.
Of course you can get it back out, since banks are mostly insured by the government. The point we’re making here is that most people have this concept that the bank is doing you a favor, when in fact you’re doing them a favor.
Fees, Fees, Fees
Taking your money and giving it to someone else, without giving you a decent piece of the pie is not enough for them. They’ve come up with dozens (or hundreds) of ways to take more money from you. Let’s start with the minimum balance fee. If you aren’t important enough to them because you don’t have enough money, that’s OK, they’ll just charge you a fee for the honor of being able to store your money in their vault.
What about bounced checks. I understand that they have to charge you a fee when you bounce a check, but upwards of $35? Does it really cost them that much more to handle an exception? Probably not, but is that all they charge for a bounced check? No, the person who deposited your bounced check also had to pay a fee. So one bounced check can make the banking industry $70 or more each time. What happens when you deposit a large check that eventually bounces, but you’ve written several smaller checks on the assumption that the deposit has cleared. Now you are out by hundreds of dollars, and it wasn’t even your fault. That’s is what the banking industry is all about – ways to make your money that you put into your account their money.
I could go on with fees, ATM fees, cash deposit fees, online banking deposit fees, check image fees, and so on. Get used to it, because there is a fee for everything. Turns out that free coffee at the local branch isn’t really free.
If you want to save for your retirement, and you are willing to take on at least some risk, then the bank is the last place you want to keep your money. You need to invest it some other way. Consider the Money Club.