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TechnoDestructo
November 13, 2009 4:36 PM
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I saw the headline and thought...what, 20, 40 bucks a year?

God DAMN.

They're really serious about this \"we're only serving rich people now\" thing, aren't they?

Along with every other non fast-food non-Walmart business in the US, apparently.

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2 replies
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ztoop
November 13, 2009 4:36 PM
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@TechnoDestructo:

I'll cancel my account this week. It is my secondary account anyway.

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WraithSama
November 13, 2009 4:36 PM
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@TechnoDestructo:
The first two lines of your post are almost verbatim what I was thinking when I read the article. :)

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mbz32190
November 13, 2009 4:36 PM
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How nice of them to take \"our\" (government) money and then charge the people who contributed to that bailout, the most. Good thing I never opened an account there when they opened a bunch of branches near me.

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3 replies
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NeverLetMeDown
November 13, 2009 4:36 PM
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@mbz32190:


Low-end checking account customers didn't contribute meaningfully to the bailout. Upper-income taxpayers (who typically have more than $1500 in their checking accounts pay the vast bulk of income taxes.

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AngryK9
November 13, 2009 4:36 PM
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@NeverLetMeDown: And you know this for a fact. You have the numbers to back it up.

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NeverLetMeDown
November 13, 2009 4:36 PM
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@AngryK9:


Yes, I do. The top 20% of earners receive 53% of the income, and pay 67% of all federal taxes (including payroll taxes). The bottom 40% of earners receive 12% of income, and pay about 3% of taxes.


[www.taxpolicycenter.org]

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AnthonyC
November 13, 2009 4:36 PM
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@NeverLetMeDown:
All good numbers.

One thing, though- the bailout wasn't paid for with taxes- not yet, anyway. It was paid for through borrowing. It will ultimately be paid for either through tax increases or budget cuts. If taxes rise, it will likely be on wealthier Americans- they can more easily absorb the change, and more importantly, taxes on high incomes are at historical (and global) lows. But if budgets are cut, the burden will be on lower-income people who benefit most from the programs being cut.

My prediction is on the former- not because it is the logical thing to do (though it is) but because high-income people represent a smaller share of voters.

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Cant_stop_the_rock
November 13, 2009 4:36 PM
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@AngryK9:

[money.cnn.com]

47% of households pay no federal income tax, so it seems pretty likely that most people who have an average daily balance of less than $1500 pay little or no federal income tax. The top 5% pay more than 50% of federal income taxes.

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yentaleh
November 13, 2009 4:36 PM
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Wow. I wonder how this going to affect people who collect disability. (My sister in law in Wis. is on federal disability and she has her accounts with Citibank.)

I know at least here in Canada its against the law if you collect federal assurance money for banks to levy a fee. Is that the same in the U.S.?

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6 replies
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Eyebrows McGee (now with more baby!)
November 13, 2009 4:36 PM
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@yentaleh: It's supposed to be illegal for them to do things like this with social security ... but when people have brought cases, the banks have basically said \"That's too hard for us to administer\" and the courts have said, \"golly gee darn gosh, that IS hard! carry on!\"

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BrotherFlounder
November 13, 2009 4:36 PM
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@yentaleh: Don't know about Citibank, but Bank of America's basic account lets you avoid fees if you have at least one direct deposit per month; it's designed for people with Social Security, disability, etc.

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grandzu
November 13, 2009 4:36 PM
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@BrotherFlounder:
Citibank has those types of accounts but they are going to close them to implement these fees.

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dpeters11
November 13, 2009 4:36 PM
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@BrotherFlounder: It sounds like that's how they did it, the fee was waived when using direct deposit, but now it won't be.

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Rob
November 13, 2009 4:36 PM
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@yentaleh: No it is not, in the United States it's illegal to garnish money from the checks but after it arrives in a bank account its fair game, the bank can charge service fees of any type.

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TheOtherBob
November 13, 2009 4:36 PM
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It's hard finding a truly good bank -- all banks have flaws these days. But there are degrees of bad. There's \"kinda bad at customer service sometimes\" bad, which is most banks -- not perfect, but generally make at least some effort.


Then there's \"absolutely hate our customers and hope they die\" bad...which is Citibank these days. I have to think that they've figured out some way to profit from going bankrupt -- because they're absolutely bleeding customers, and at this point it seems practically intentional.

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6 replies
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AdvocatesDevil
November 13, 2009 4:36 PM
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@TheOtherBob: What's a bank? My credit union does NONE of this crap. :)

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mdr
November 13, 2009 4:36 PM
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@AdvocatesDevil: My credit union has been playing the screw the customer game too. Currently looking for somewhere else, but seems the best place to keep your money is under a mattress.

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AngryK9
November 13, 2009 4:36 PM
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@TheOtherBob: The small independent banks were the best. You know, all those little banks that the big banks that took the bailout money bought out with said bailout money?

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ludwigk
November 13, 2009 4:36 PM
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@AngryK9: Or perhaps the small ones that are dropping like flies, since something like 150+ banks went under this year?

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justagigilo85
November 13, 2009 4:36 PM
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@ludwigk: I believe that number is closer to 101.

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ecwis
November 13, 2009 4:36 PM
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@TheOtherBob: I like Schwab bank. For depositing cash, I have a Chase account. They are bad sometimes but their ATM service is pretty good.

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frank64
November 13, 2009 4:36 PM
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30% credit card rates and $90 checking accounts. What an expensive bank! There are so many better, cheaper options.

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ChemicallyInert
November 13, 2009 4:36 PM
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Wells Fargo and Bank Of America welcome the new customers with open arms. They should send Citi a card.

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10 replies
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dangerp
November 13, 2009 4:36 PM
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@ChemicallyInert: Um, I just closed a wells fargo account specifically because of the fees that they charge. Ironically enough, I switched to Citibank. I guess I have to find a new bank. Look out credit unions, here I come!

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TurnkeyDB
November 13, 2009 4:36 PM
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@dangerp: Yea and I'm close to closing mine to after I noticed WF starting charging me 12 bucks a month because 1 account dropped under $2500 and I don't have a minimum $100 direct deposit coming in anymore because I got laid off a few months ago.

A nice lady at the local WF branch cheerfully explained all the other accounts they would be happy to move me into to stop the bleepin fee every month so apprently now I have to play checking account roulette to stop the bleeding. Or I could head down the street to the local credit union...

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ChemicallyInert
November 13, 2009 4:36 PM
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@dangerp: Well, I would have said Wachovia, but they're basically Wells Fargo now. I'm pretty much okay with the Wachovia service I've been getting and I have a free checking account. Maybe I'll have to change over after they rebrand.

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BrotherFlounder
November 13, 2009 4:36 PM
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@ChemicallyInert: Bank of America already does this for their basic accounts, although it's much easier to avoid the fees.

[www1.bankofamerica.com]

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whylime
November 13, 2009 4:36 PM
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@BrotherFlounder:

Yeah. BofA began doing this a few months ago. I promptly closed my account and switched to a credit union. Shame. I had my account with them since 2003.

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ludwigk
November 13, 2009 4:36 PM
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@BrotherFlounder: In anticipation of this change, I converted my account to a student account, which has no fees and no minimum balance for 5 years. It gets very limited check usage as well, but I have a Charles Schwab account for all of that.

I'm not recommending this generally to try and avoid BoA fees, as I think you actually have to be a student for this to apply to you.

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Rob
November 13, 2009 4:36 PM
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@BrotherFlounder:It seems odd to see all these accounts with fees. The bank I work for has two types of checking and one type of savings with, no monthly fee, no minimum balance, no direct dep.

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Rob
November 13, 2009 4:36 PM
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@ChemicallyInert: Unless they get wind of this idea, I wouldn't put this past most of the big 10. The only one I don't think would do this is US Bank and thats because they generally already cater to \"high class\" banking customers and still don't charge people on the low end a monthly fee.

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dohtem
November 13, 2009 4:36 PM
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@ChemicallyInert: I shook my head when I read the alternatives you listed.

We are truly choosing the least evil now.

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barb95
November 13, 2009 4:36 PM
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@dohtem: exactly. I loathe BofA with a passion of a thousand suns, and Wells Fargo is not far off. I currently have Citibank and haven't had any problems, but this fee will tick me off. I don't know where to go anymore.

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ChemicallyInert
November 13, 2009 4:36 PM
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@barb95: I know what you mean. Sometimes, I read the Consumerist and think, \"Ha! Now these companies know that their shadiness leads to people going elsewhere!\" Meanwhile, companies populate the list until you have to start arbitrarily forgiving/forgetting older infractions or go live off the grid and never buy anything again.

Forget the government, corporations will run the next fascist totalitarian dictatorship. (Hell, in some countries, they already do.)

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Deezul_AwT
November 13, 2009 4:36 PM
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Time to find a credit union in your area.

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Quatre707
November 13, 2009 4:36 PM
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I don't get it. Why would they expect people to pay a fee to use their services, when the competition does it for free?

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3 replies
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dumblonde
November 13, 2009 4:36 PM
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@Quatre707: Because they are hoping that their competitors will follow suit of not many customers leave Citi.

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fs2k2isfun
November 13, 2009 4:36 PM
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@Quatre707: Also convenience. If you are in an area with a lot of Citi branches/ATMs, the convenience might be worth the extra few dollars a month.

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TuxthePenguin
November 13, 2009 4:36 PM
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@Quatre707: Because not everyone will leave for the competition. All that bill pay, autopayments, etc.

That... and they expect their competition to begin doing it as well.

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sonneillon
November 13, 2009 4:36 PM
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1500 dollars? That is silly, I do not get dinged a fee unless I overdraft. I think the minimum my account has to be is 5 dollars. I have a credit union account too and that also has a minimum of 5 dollars.

1500 dollars is ridiculous.

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5 replies
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XTC46
November 13, 2009 4:36 PM
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@sonneillon: And where do you expect the bank to get money to operate if you keep $5 in the bank?


Do you think managing your money is free? Do you think the teller's time is free? Do you think they can collect enough interest on $5 to make it worth keeping you as a customer?

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EdnaLegume
November 13, 2009 4:36 PM
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@xtc46 - thinksmarter on twitter: what about the personal and auto and home loans they offer, the credit card accounts they provide, the OTHER banking services they offer... etc. you think banks run on checking accounts alone? lol

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NYGuy1976
November 13, 2009 4:36 PM
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@EdnaLegume: What about all the customers who default on said credit cards, home loans, etc. Maybe the bank realizes customers who keep very low balances are more likely to default on any credit products they have.

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sonneillon
November 13, 2009 4:36 PM
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@xtc46 - thinksmarter on twitter: Do they need 1 person for everybody that has 5 dollars? The answer is no. Since 5 dollars is the minimum it stands to reason that they need no people to manage that money since the the only action available is to close the account. So your argument is faulty. Every person who has 5 dollars has only to contend with 1 person be it 1 or 100,000 people because there exists a binary transaction available (close account or add more money). When more money is entered it ceases to be a 5 dollar account, and with the larger use of ebanking, direct deposit and ATMs the need for tellers is much less.

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jamar0303
November 13, 2009 4:36 PM
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@jamar0303: And that's all I'm going to say on this because of what happened the last time I gave my two cents on the banking system on this site.

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Moosenogger
November 13, 2009 4:36 PM
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@xtc46 - thinksmarter on twitter: From all the overdraft fee gauging, I'd wager. They make so much money yearly through overdraft and other fees that they can easily afford to have people who keep around $5 in the their accounts.

Hell, those are the people who are most likely to overdraft in the first place.

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XTC46
November 13, 2009 4:36 PM
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@Moosenogger: Right, but does the user above overdraft? Maybe, but maybe not, and if he doesnt, they make no money.


Also, having an average balance of 1500 seems somewhat high, my checking account average balance is at most a few hundred dollars, and it is that way becasue i keep all of my money in a savings account with a better interest rate, then only transfer in money to pay bills as needed.

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ChemicallyInert
November 13, 2009 4:36 PM
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@xtc46 - thinksmarter on twitter: Shorter xtc46- I know nothing about how banks make their money.

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Stephmo
November 13, 2009 4:36 PM
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@xtc46 - thinksmarter on twitter: For Citi, it's waived if you keep $1500 in any of your linked accounts - from their site:

These are all the accounts whose balances are combined to help you meet the balance requirement to avoid monthly maintenance and per check fees for the Citibank EZ Checking banking package:

* Checking
* CDs
* Day-to-Day Savings
* Money Market

Most banks understand that customers will want to have multiple accounts and only require specific deposit amounts on interest-bearing accounts. For monthly maintenance fees, they'll take deposit amounts across accounts. Service fees for other things are case-by-case (ATM fees, check-writing fees, going over Reg D transactions, etc.).

Basically, CITI is saying, \"we want you to have at least $1500 with us at all times in some sort of account.\"

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StanTheManDean
November 13, 2009 4:36 PM
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0% Interest courtesty of Uncle Sammy does cost $.

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2 replies
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leprechaunshawn
November 13, 2009 4:36 PM
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@StanTheManDean:


Maybe Uncle Sam should just send all the banks that got bailed out a letter stating that their bailout money now comes with a 30% interest rate.

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Al Swearengen
November 13, 2009 4:36 PM
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@StanTheManDean:


They want to pay the federal loans back as soon as possible so they can start paying their executives ridiculous amounts of money again. Just think of these fees as the tip jar contributing to the retirements of super rich executives.

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bones11
November 13, 2009 4:36 PM
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I can't believe more people don't have an account at a credit union. Honestly, what good are big banks? I learned when I was 13 what terrible things banks do and never again will I do my business with one. Had an account with First Security, which was taken over by Wells Fargo. I would put all my allowance and babysitting money in to it, at one point in time they started charging fees to people who only had savings accounts and after two months of that I took all my money out (a whole $300) and opened an account at my credit union. Better rates, they care more about my business, they haven't messed anything up, free checks (only used for rent), free overdraft protection account, the list goes on.


Something crazy I had one of my customers point out to me the other day, he just moved here from Florida, goes through Bank of America. Anyways, I guess there are 0 BofA's in Utah. Never knew that until Friday. I guess they don't consider Utah part of America and quite honestly I hope they keep their bank out of this state, we don't need their \"services.\"

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5 replies
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lmarconi
November 13, 2009 4:36 PM
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@bones11: The only reason why I'm not at a credit union or small local bank is because I travel/move around a lot and I primarily live in a big city where there aren't a lot of decent credit unions or local banks.

I suspect some people have similar reasons.

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jeffbone
November 13, 2009 4:36 PM
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@lmarconi: Many credit unions participate in a branch office sharing arrangement that allows you to transact business at a \"foreign\" CU as if you were at one of the home offices:

[www.cuservicecenter.com]

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ecwis
November 13, 2009 4:36 PM
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@bones11: Every credit union I've researched has more fees than my \"big bank.\" My bank gives me free unlimited checks, free withdrawals at any ATM, and they don't charge to replace a lost ATM card like many credit unions. I'm glad you're satisfied with your credit union but I'm just as happy with my bank.

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Verucalise (Est.February2008)
November 13, 2009 4:36 PM
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@ecwis: Now, I ordered these nice checks online for a whole whopping $10.00 for 3 boxes, which lasts me YEARS. My old bank offered that as a \"perk\" and I saw very quickly how they COULD offer it- with exorbitant overdraft fees ($38 first time, if you bounce another check within 12 months it goes up to $45) and other asinine charges like charging $20 if my account accidentally overdrafts to pull MY OWN MONEY out of the savings account to cover it.


Fast forward to our credit union... I might not get free checks, but I can use THOUSANDS of ATM's for free, pretty much any other credit union in the U.S.+ certain out of area network ones. Online bill pay is great, THE BEST interest rates in our area (just refinanced my van- 5.89%) and it's like CHEERS- Everyone knows my name, which is great. I walk in, sign a check, hand it to the teller and she asks \"Checking or savings, Heather?\" ... wonderful service. I disputed a charge 5 months after we opened the account and I had the money back within 24 hours. I've saved so much thru them!


Usually credit unions do the best they can for their customers, their loan department is more forgiving- they don't look at just the score, I could talk to them. Best $5 join fee I could ever pay.

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Jesse
November 13, 2009 4:36 PM
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@Verucalise(countingcalories):

I just opened a checking account with a credit union last week. This account will pay 4% interest and refund ATM fees on both ends nationwide as long as I make 12 check card purchases a month and either use online billpay or direct deposit. They also participate in the CUSC shared branching program jeffbone linked above.

I think people avoid credit unions since membership rules were far more strict in the past, people don't want to switch banks (it is a small hassle) and people don't trust credit unions for some reason.

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RandomHookup
January 13, 2010 9:01 AM
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Two other reasons why people have avoided credit unions:

* Size of ATM network (and fees for using non-network ATMs)
* Online banking

It sounds like those may have been addressed by most of the CUs, but it's hard to make a blanket case since the CUs are independent.

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wcnghj
November 13, 2009 4:36 PM
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@ecwis: And many CU's give you free online billpay...

Why would you need checks with that?

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dbshaw
November 13, 2009 4:36 PM
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Thanks for the tip, closing my account at citi.

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NeverLetMeDown
November 13, 2009 4:36 PM
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As a taxpayer (and hence Citi shareholder) I say more power to 'em - the more money they make, the better the taxpayer does.

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2 replies
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NeverLetMeDown
November 13, 2009 4:36 PM
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@dumblonde:


No, I'm not. The US taxpayer now has a financial interest in the profitability of Citibank, and I want them to make as much money as possible, and charging higher fees to low-value customers seems a good way to do it.

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NatalieErin
November 13, 2009 4:36 PM
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@NeverLetMeDown: Unless so many customers leave or choose not to get accounts in the first place that they actually lose money.

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Schmeeky
November 13, 2009 4:36 PM
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If you aren't eligible for a credit union or their branch locations aren't convenient enough then look at community banks as well. Even smaller for-profit banks can beat the big megabanks at their own game.

And if you don't need paper checks or statements, ING's electronic checking account is pretty nice as well.

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ludwigk
November 13, 2009 4:36 PM
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@Schmeeky: I find Charles Schwab bank to be pretty convenient. They have generous checking, no minimum balance, and free ATMs in the entire US (since they have NO atms of their own, they pay all the fees).

Of course, it requires having a linked brokerage account, so if you're scraping by, this is probably the opposite of helpful.

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zacox
November 13, 2009 4:36 PM
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I hate to say I told you so. But, I told you so. :(

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trujunglist
November 13, 2009 4:36 PM
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First the airlines charged a fee for baggage and I said nothing because I flew Southwest. Then the banks started charging a fee for checking accounts but I said nothing because I used a credit union. Then something else happened and I got hit with a bunch of bullshit fees so now I'm pissed off. or something like that.

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ARP
November 13, 2009 4:36 PM
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@trujunglist: You're treadig very close a Goodwin's Law violation. Keep it in line mister/misses /snark.

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Al Swearengen
November 13, 2009 4:36 PM
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@ARP:


You know who else charged fees for checking balances under $1500.... Hitler

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NYGuy1976
November 13, 2009 4:36 PM
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Free checking was never gonna last at the big banks for small customers. Having thousands of branches and thousands of ATM's costs a lot of money. I am sure they don't care if small accounts leave. The truth is, a small account customer who never overdrafts or accumulates fees actually costs the bank money.

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vastrightwing
November 13, 2009 4:36 PM
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@NYGuy1976: FREE checking is not free. There are a ton of fees banks charge that make \"Free\" checking not so free. ATMS are a lot cheaper than employees and tellers. An ATM has a one time charge, but works cheap, has no benefits and is tossed away when its services are no longer required. Are you kidding? Banks profit on over drafts and returned checks. Banks have a totally automated system for processing checks and maintaining accounts. They profit handsomely when \"small\" customers cause fees. I'll venture to say most banks make most of their profit from small account holders who bounce checks and overdraw their accounts. Account fees are gravy on top of the fees. Fees are the bank's business model. They attract customers initially with \"free\" accounts that switch to not so free accounts after they have critical mass. My bank has done this to me many times: \"Free\" savings account with only $250 balance. Oops! Today the minimum balance is $500! Please pay $5/mo. thank you for your business.

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KnightoftheVoid
November 18, 2009 4:52 PM
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@vastrightwing:

Not quite true, ATMs run on electricity, have paper rolls and ink ribbons that need re-ordering / replacing, are run by computers that need maintenance, require refilling, require surveillance, occasionally need service calls from the corporations that set them up (Diebold and the like), and require balancing to resolve disputes. They're far from a 'one time charge'.

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pinkbunnyslippers
November 13, 2009 4:36 PM
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Ugh - I'm thisclose to taking all my money out of everywhere and hiding it under my mattress.

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whysthsncnsmrst
November 13, 2009 4:36 PM
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Wow. Can't say I didn't see this coming. Shifting business models and loss of certain kinds of revenue will make the big banks take some crappy alternatives for cash flow. I hope USAA never goes public!

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SadSam
November 13, 2009 4:36 PM
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Putting aside the bail out issue, can a bank make enough money off a customer with free checking account, who never overdrafts or incurs ATM fees, etc. just by the float?


If not, then the imposition of a monthly fee makes sense, will they refund the monthly fee if the customer racks up enough fees?

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Al Swearengen
November 13, 2009 4:36 PM
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@SadSam:


The banks take your money and invest it. Sure they make money on some transaction fees, but the real money is in the investments. Since they don't have the dubious investments making 30% a year anymore, banking is no longer insanely profitable. That's how it should be. Banking should be about safe returns, not gambling with everyone's money and leaving it to the feds to pay off the losses.

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vastrightwing
November 13, 2009 4:36 PM
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@Al Swearengen: Banks make money on their fees. Consider you bounce a check for $50. The bank charges you $39 + interest and you have to pay back the $50. That is one hell of a loan. This makes payday loans seem like a good deal. Every time you use your \"overdraft\", the bank hits you with a $5.00 fee and uses your own many to cover it! If the bank has extended you credit, then you pay the $5 fee plus the 20% interest or more. Every time you use your Debit card, the merchant pays the bank about 2%. Use a foreign ATM? Your bank makes a profit from that too. I seriously doubt banks make most of their money from loaning money on traditional loans, they make it from you by charging you fees. Why else would there be so many banks on all the corners of every block in the city?

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whysthsncnsmrst
November 13, 2009 4:36 PM
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@SadSam: Not from the consumer who carries $1,500 in the bank probably uses other profitable instruments that the bank offers.

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lmarconi
November 13, 2009 4:36 PM
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@whysthsncnsmrst: I was thinking about this as well. Let's say Joe keeps 1,000 in his checking account, but 5,000 in his savings and 10,000 in a CD at Citibank or BoA. Are they still going to charge him a fee for being a minor customer? It seems like you should get a free checking account if the total amount of money in all your accounts at the bank exceeds a certain amount.

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ARP
November 13, 2009 4:36 PM
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@lmarconi: See above. Citibank combines all accounts to calculate the $1500. I keep $1500 in my savings and let me checking float (dangerously close to zero at times).

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whysthsncnsmrst
November 13, 2009 4:36 PM
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@lmarconi: @xtc46 - thinksmarter on twitter: Unless I'm wrong, the $5 is symbolic gesture of membership to the credit union. I think if you go below that $5 share, they can give you the boot from the co-op.

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KnightoftheVoid
November 18, 2009 4:52 PM
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@whysthsncnsmrst:

The $5 is what makes you a member of that credit union, it is the 'share' that you own in the credit union, giving you the right to vote on all issues at the yearly meeting, and entitling you to all the services and products that your credit union offers. I'm sure policy varies from CU to CU, but from what I've seen, members are given a pretty generous amount of time to work their accounts out of the negative, but after ~30 days a negative balance in a checking account will be transferred to savings and the checking closed, much longer than that and you risk having your savings account charged off, closed, and reported to credit agency (unless you have made special arrangements with the CU collections / fraud dept).

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whysthsncnsmrst
November 13, 2009 4:36 PM
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@SadSam: Thanks for gutting my post, Chrome. Anyway, I meant to say:

Not from the consumer who carries <$1,500 in the bank. I would imagine that the bank performed some kind of risk profile to come up with that number. Or maybe, depositors at that dollar amount may not use as many other profit making offerings of the company. Hell, banks are social programs and it's not like there aren't plenty of alternatives.

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Snarkysnake
November 13, 2009 4:36 PM
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Ready for some even more painful news? I thought so.

You folks that have pointed out that these jokers took governmnent bailout $$$ - Give yourself a gold star. But want to know the hell of it all ? Here goes:

Citi and other big banks took all that bailout sugar and were supposed to use our money to repair the damage on their balance sheet and begin lending again. That in turn would jump start the economy and get things back to \"normal\".

But no. These banks are not only NOT lending , they are putting the money in risk free government treasury bonds and pocketing the spread between what they paid for the money ($0) and what they earn on the bonds (vairies ,but around 2- 2/12 % on average)

Now. 2 1/2% doesn't sound like much...UNTIL you realize that a return on assets at a bank in \"normal\" times is considered pretty good at 1% wildy good at 1 1/2%. It's plain and simple stealing what Citi is doing here.

Remember this when the next meltdown occurs.

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whysthsncnsmrst
November 13, 2009 4:36 PM
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@Snarkysnake: Isn't arbitrage great?

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OldGreyTroll
November 13, 2009 4:36 PM
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I got my \"You're not filling our coffers fast enough, go away!\" letter from Citi today on my airline-affiliated credit card. 24% interest unless I go $3000 deeper into debt with them. (and pay them 3% balance transfer fee on it).

I'll be closing this card down tomorrow.

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NeverLetMeDown
November 13, 2009 4:36 PM
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@OldGreyTroll:


Unless it has an annual fee, don't close the account. Just stick it in a drawer. Better for your credit rating.

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OldGreyTroll
November 13, 2009 4:36 PM
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@NeverLetMeDown: Unfortunately, it DOES have an annual fee. I was already dithering whether the fee was worth what I get from the card. This makes the decision for me.

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jeffbone
November 13, 2009 4:36 PM
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@NeverLetMeDown: Keeping it open might not be an option, if Citi decides to go through another round of unilateral account closures:

[consumerist.com]

I'm still trying to understand how killing revenue from paying customers fits with their business model. Must be the new math.

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eddieck
November 13, 2009 4:36 PM
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@yodel: Here in Arizona Wells Fargo has a completely free, no-frills checking account. No free checks, no interest, etc. but no minimum balance or monthly fees.

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H3ion
November 13, 2009 4:36 PM
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Some banks will give you free checking with no minimum balance if you have some other account with the bank, like a savings account, home mortgage or home equity loan, or auto loan. It may be worth looking into. I try to keep the bare minimum in checking because the interest rate on checking deposits is pathetic.

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t0ph
November 13, 2009 4:36 PM
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I pay $3 a month for my checking account @ TD Bank, and there is no minimum balance, and I can write up to 8 checks per month. I actually opted for that one over another they had which was free but then starts charging $15(!) a month after a year if you fall below x ($100 I think). I don't mind paying $3, I feel it is a fair price to service my account. $5, $10 or $15 is crazy, and so is the $1500 min balance Citi is imposing.

My mother lives on a fixed income from disability and I know how each and every little charges matters ALOT. This news is too bad for those that do not have many banking options.

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morlo
November 13, 2009 4:36 PM
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@t0ph: Have you heard of the internet? There are plenty of banks with no fees (limited to 8 checks a month? that bank is stuck in 1985!). Unless you are making a lot of cash deposits you don't need a local bank.

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t0ph
November 13, 2009 4:36 PM
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@morlo: I make 95% cash deposits, so I NEED a local bank. Also, I do not have a steady direct deposit that would enable the 'free' checking option at many of the big banks, and I write 1 or no checks a month. Like I said, $3 a month is worth it to me. I am not gong to inconvenience myself to save such a nominal fee.

What is this internet you speak of?

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CentralServices
November 13, 2009 4:36 PM
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Remember how City Wok from South Park was pronounced by the owner? That definately applies here.

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Ssscorpion
November 13, 2009 4:36 PM
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Google \"2009 Retail Banking Satisfaction Study\" and \"JD Power and Associates.\" They list the bank in each area of the country that ranks highest in customer satisfaction.

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dumblonde
November 13, 2009 4:36 PM
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Here in Puerto Rico Citi was bought out by Banco Popular. I have this nifty checking account with Popular that is free as long as I log in to online banking. I log in to online banking very regularly so it's essentially a free account with no minimum.
Thank God Citi is gone from here. Good riddance!

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AHepburnGuy
November 13, 2009 4:36 PM
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Jesus. Since when did \"fees\" become the new sheriff in town? Phone fees, bag fees, ETFs, now checking account fees? I almost want them to raise the base price of everything just so I never have to hear the word fee again!

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NewsMuncher
November 13, 2009 4:36 PM
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I thought that people put their money in banks as an \"investment\" - the bank is taking your money and using it - they use it to make loans to other customers. This is why you are paid interest on your money that you placed in the hands of the bank. The idea is that the bank makes money off of the loans and other financial products they offer to other customers using your money as the material from which their financial products are made.
So how does it make sense that I should pay the bank to lend them money that they use to lend to other people without giving me a share of the interest of the money being lent to other people?
Or is this not how it works anymore? In which case I ask, where is the bank getting the money they lend to other customers?

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morlo
November 13, 2009 4:36 PM
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@NewsMuncher: The government lends to banks at near 0%, so paying interest to depositors is ridiculous considering that the bank has to pay for tellers etc.

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vastrightwing
November 13, 2009 4:36 PM
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@NewsMuncher: The banks learned that they can abuse their customers and they won't leave as long as they aren't worse than the other banks. I will switch banks at the blink of an eye when I find a better deal at a bank. Mostly I watch my accounts using Mint.com and pay attention to my money so the bank won't steal too much of it from me. Otherwise, I recommend your mattress.

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gcas
November 13, 2009 4:36 PM
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Do people still pay checking account fees? I've had mine since college and haven't had to pay any fees since. I thought those were a thing of the past!

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girl_scientist
November 13, 2009 4:36 PM
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Makes me even happier that we closed our citi checking account last year. Now we bank at a credit union and get 4.5% interest. Credit unions rock!

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Al Swearengen
November 13, 2009 4:36 PM
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Let's just cut out the middleman already and just start Google Bank.

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originalread
November 13, 2009 4:36 PM
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Citi started to change me $9.50 on an online account. I only used it as my paypal linked account. I ditched them after that.


I'll stick with my USAA Checking and Savings.

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PeteyNice
November 13, 2009 4:36 PM
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I do not see the allure of credit unions (except as an FU to banks). Their websites are archaic and the interest is low.

Schwab refunds any and all ATM fees, has wonderful American based customer service, and a pleasant web interface. Not to mention no-minimum balance and even a bit of interest for your trouble.

Yes, you can do the rewards checking thing and get a superior interest rate but most of them are capped at $10,000 or $25,000 and you have to jump through hoops.

Schwab has no hoops.

Unless you deal in lots of cash I don't see why anyone would not use Schwab.

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morlo
November 13, 2009 4:36 PM
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The Fed 0% rate means banks don't need or want deposit customers.

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yellowlight
November 13, 2009 4:36 PM
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@morlo: Actually they are making a huge spread with deposits now. That is a bit misleading. The reason this is occurring is checking is not profitable, they actually lose money on it. It is used as a way to get the customer in the door to sell other products. That is why they are willing to take such a lose on college students, it's a long-term strategy. I won't commit if it works but that is the basic idea behind it.

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vdragonmpc
November 13, 2009 4:36 PM
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Be careful about Credit Unions. Not all are safe. I have been a member of Dupont Fibers Federal Credit Union since 1991 and they have been getting shadier and shadier.

It has a lot to do with their moves and building of unused branches. Lately rates and fees have been bad. They offer lower rates on savings than almost ALL of the banks and are now charging fees for checking.

They cleaned out an account we had for my wife's college expenses. We only use it at certain times. Since it was below their new balance system they charged 10$. Even though we have other accounts with extremely large balances they cleared out the account and its now empty.

What seems to have happened is they decided to be more like a commercial bank. They have no customer service as it seems only one person ever answers the phone and she is a Teller. No matter what issue I have its always the same employee at one of their branches that picks up and she can never help with anything. Im still disturbed that a credit union instituted fees to clear out low usage accounts.

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