I have received a very rude awakening recently when it comes to banks. Please understand first of all that, primarily due to my job, for the past 10 years I have always done all of my “banking” through a brokerage firm. So my checking, my savings, my investing, everything has been handled by a non-bank entity. What I am finding is that I’ve had it good.
Last October this all changed. The branch office which had been located in my work building for the brokerage was moved so it suddenly became less convenient to make deposits into my account because it would a drive and could only be done during regular business hours. If my only source of deposits were paychecks, this would not be a big deal, but I also have rental income. So I decided that, rather than be forced to visit the branch office, I would just open a local bank account so I could easily make deposits through the ATM and on weekends. Sounds like a good plan, right?
So I shopped around a bit and decided to open an account with Bank of America. They were conveniently located all across the country as well as around the corner. All was well for the first few months and then I made a deposit – my regular monthly deposit, I might add – and inexplicably, they put a delay on the funds for 10 business days. That’s 10 BUSINESS days which is otherwise known as 2 weeks! What the heck?! I called to protest and request information as to why they put such a delay on, but they couldn’t tell me. “This was an ATM deposit,” I was told, “and so we can’t see why there was a delay added to those funds, but you should be receiving a letter in the mail explaining.” (Incidentally, I did receive the letter AFTER the delay was lifted and still it gave no reason for the delay).
After that (and a few other minor infractions), I decided that I was going to close my B of A account. I removed all funds and opened an account instead with PNC (which so far has been a pleasant experience). All I had left to do with B of A was actually go in and close the thing. And then yesterday happened.
There is a recurring charge that hits my account every quarter. I thought – in fact, I’m sure – that I changed the card for the charge to my brokerage debit from my B of A debit, but apparently it didn’t take. Since I had not yet closed the B of A account, the charge hit yesterday causing my flat account to go into an overdraft.
First off, I was completely aggravated by the fact that B of A would approve a charge coming through on an account that had no money in it. Why on earth would that do that? What kind of business sense does that make? I called. I complained. I was met with bizarre excuses such as, “The card machines have no way of knowing how much money you have in your account.” Um…what? Ex-squeeze me? Baking powder? You’re joking, right? What do you mean they don’t know? You mean I could run over to the ATM and pull up my account balance electronically, but that the electronic machine at the vendor doesn’t have access to that same data? Ridiculous. It’s not like it was a paper check that came through – it was a charge on a card with a $0 account balance that had been $0 for at LEAST 3 weeks.
The rudest part of my awakening came in discussing this whole debacle with my sister last night. “All banks do that, Deb,” she told me. “They make a ton of money off fees and that’s how they do it – by approving things they shouldn’t approve so your account gets thrown into overdraft and then they can charge you $35 or whatever. It’s also how they sell overdraft protection through a savings account…or better yet, a credit card.” (Danger, Will Robinson!)
I was dumbstruck. Seriously. I had no idea. MY “bank” (read: brokerage) doesn’t do that. In fact, even if you were about to go into an overdraft, they’ll call you first and see if you can bring a deposit in. If you can, they’ll go ahead and pass the check or charge or whatever it is coming through. No fees.
I wish I could say the saga ends there, but alas.
So I had a wire transfer sent FROM my primary brokerage account over to B of A so that the freakish-never-should-have-happened overdraft would be covered immediately and would you believe that B of A has managed to charged me AGAIN – $12 for an INCOMING wire transfer!!! I mean COME ON people! Why on EARTH would they charge me for INCOMING transfers? WHY? Is that standard bank practice across the board too? I’ve NEVER heard of such a thing. Ever. I would expect to be charged when SENDING a wire transfer – that makes sense. But RECEIVING one?! What kind of insane business model is that?
That’s it for me. I’m done with banks.
Resident Mr. Murphy
It’s true what Dave Ramsey says – as soon as you start working to get on top of your budget and spending, Murphy does what he can to try and move into your spare room. Thankfully I already rent out my second bedroom so there really is no space for him, but he’s a persistent bugger.
First, it started with my having to get new tires for my car. While this would have been no big event had I been on the Dave Ramsey plan for several months, I was just starting out and therefore had very little built up in my Car Service envelope to cover such a major expense. I say “major” partly because my car apparently has performance tires on it meaning that I couldn’t replace them with just any ol’ tire. Rather, they needed to either have two new “full” performance tires (read: exactly what came on the car). These tires would have run me nearly $200 each. The second (and far more appealing) option was to replace all 4 tires with less-pricey, all-weather tires of a slightly different size. The job still ended up running me about $400 total with installation, etc. but caused me to dip into my starter emergency fund to make up the difference between what I had and what I needed and kicked Murphy out.
But like I said, he’s persistent.
No sooner had I gotten my emergency fund replenished than I started having leaking issues with my 21-year-old roof. Again, not something that would have been a problem had I enough time on the DR plan to fully save up for the roof replacement, but the leaks caused me to have the roof replaced sooner…MUCH sooner…than expected. The job was completed this past weekend which thrilled me since we had some serious rain yesterday, still it’s not only an expense I’m having to tackle sooner than my budget allowed. I haven’t gotten the final bill yet, but due to additional plywood replacements that they hadn’t originally thought they’d have to do, it may completely wipe out my emergency fund and then some… Murphy strikes again.
I know that once I have my fully funded emergency fund (3-6 months of expenses), Murphy will be almost completely repelled – it’s just this interim time where I feel like he’s sitting on my front porch that gets discouraging.
I know he’ll be gone eventually – I just need to stick with the plan. If only I could sic Chena on him in the meantime.
I should probably also mention that, although having to dip into and subsequently replenish my emergency fund, while annoying, has been a key part of my staying on-track and on-plan. In my pre-Dave Ramsey life, I would have reached for the credit cards faster than you could say, “stupid tax.” In other words, the emergency fund – while still only in the starter stages – is doing its job, and doing it well.