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Expenses and Savings – Checking March 21, 2007

Posted by pf in Expenses and Savings.
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For quite some time now I’ve been not too satisfied with my current checking account.  Don’t get me wrong, it has basically everything I want like free checks, free billpay, online statements, etc.  It is also an interest bearing account.  However, it is embarrassingly so with a 0.25% rate.  In fact, having the interest is annoying as it creates one more 1099-INT I have to worry about come tax time…for the whole $15 bucks I received.  

 It does have a few perks like no fees for travelers checques and cashiers checks (usually 7.00 each…not that I have used it all that much).  These “perks” were grandfathered in from my earlier accounts with other banks that were ultimately bought.  My checking account originally started out as a Wingspan account…remember them?  Well, it’s been sold 2 or 3 times since then. 

My main issue has been that I must maintain a $1500 balance in the account or be charged a $10 service fee each month.  Don’t get me wrong, actually having the funds available is not the problem…it’s the balancing act of making sure I maximize the interest I get in my GE Interest Plus account while not falling below the minimum balance requirement in my checking account.  I realize this is not a huge issue (“just make sure you have enough in there and forget about it”)…but it gives me this “itch”…and it must be “scratched”. 

So, I’m going to look around and see if I can find something that better suits my needs.  My main criteria are:

  • Must have all the requsite features I have today (free checking, billpay, etc) with the exception of the “perks” that I don’t even really use that much
  • Does not require a minimum balance.
  • Facilitates easy deposits.  For example, I don’t want an account that requires me to mail deposits.
  • Can be setup to conduct electronic transfers to/from GE Interest Plus (nice to have) 

I started my search by reviewing potentials on Bankrate, Bank Deals, and the local banks in my area.  I looked a quite a few different possibilities (even some credit unions), but whittled down the list to the following:

ING (Electric Orange)
Pros: No minimum balance, much better rate than current (starts at 3.93%), free ATM access, online bill pay
Cons:  No paper checks as a default (but can be arranged via mail for $15 service charge each time), no local branches
Harris (Lion Power Free Checking)
Pros: No minimum balance, free online banking, free introductory checks, local branches
Cons: No interest earned, online banking is handled thru 3rd party, not Harris
Chase (Free Checking)
Pros: No minimum balance, free online banking, local branches, already a customer, $100 sign-up bonus
Cons: No interest earned, no free checks, must have direct desposit
HSBC (Free checking)
Pros: No minimum balance, free introductory checks, free online banking
Cons: 1 local branch (50 miles away)

I really liked ING, but the thing about no paper checks at all just doesn’t really work for me.  While a bit rare, I still write them from time to time and don’t want to have to go through some mail process to make it happen.  I guess I could have another account just for the purpose…but it just seems silly to me.   Harris met all the criteria, but was not especially spectacular.  HSBC was generally on par with Harris, but just a shade below with no local branches within easy driving distance.  Don’t get me wrong, having a local branch was not a “must have” on my list of criteria, but if all other things are equal, why choose a bank with no local branches versus one that does?  Finally, we arrive at Chase (my current bank).  Honestly, I really don’t care for the required Direct Deposit, but it otherwise met all the main criteria, was already familiar, and added a $100 sign-up bonus (since my other account was in Virginia) to boot….so I choose them…for now. 

 I will try the electronic transfer of funds between my Chase account and GE Interest Plus and see how that works.  If I see that its taking time to post or anything like that, then I may change my mind quickly and opt for something like Harris or even ING (and see how much of a hassle this no check thing is).  My intent all along is to keep as little money as possible in this account to maximize the yield I am getting from GE Interest Plus…so making interest in the account is just not a primary consideration for me. 

Anyway, we’ll see how it goes…but another $100 in the till!

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