Sadly I can say with absolute certainty that I am very seldom wowed by a business’ customer service. In most instances you are lucky to get someone to pick up the phone let alone actually help you with your problem. Even when you get the help you need they certainly aren’t going to compensate you for whatever inconvenience you suffered. Or will they???
Lets go back in time, you may have caught my review of my new Ally checking account. I mentioned their customer service was pretty good during the account setup process but I wasn’t prepared for what happened last night.
When I opened the account they were pretty speedy about getting me my ATM card. I got it in the next week and then a few days later I got the PIN letter in the mail. My biggest reason for getting the Ally account was that they will reimburse you for all of your ATM fees. You can imagine my chagrin when I hit the ATM at work and was denied access to my cash. It was the first time I tried to use the card so I figured I just didn’t get the PIN right, seemed reasonable so I didn’t think anything of it.
I got home that day and called the automated number to change my pin but the machine and I didn’t agree. I finally decided I wouldn’t have a problem remembering the pin so I forgot about it until yesterday. I went to the grocery store to pick up some things and the guy forgot to ring up a drink so instead of throwing another $1.85 on our joint account so I paid with Ally card. I rang it as an ATM transaction just to check and low and behold SUCCESS. It was obviously a problem between the keypad and me. Or was it.
As I was making dinner last night my phone rang with a strange 877 number. I am usually reluctant to answer but I did. It was a representative from Ally, they called me to apologize for the problems I was having with my ATM card. I was pretty taken aback as I had never had someone call me about a problem before. Honestly that would have been enough for me to call it stellar but then they told me they would be depositing $25 in my account for my trouble.
Like I said in the beginning of this article, I do not regularly end up having a good experience when I deal with customer service. In fact I count the good experiences on one hand, and honestly on two fingers. I was amazed that they would not only call me to apologize but then offer me something to compensate me for my trouble. I must say I am more impressed in these few weeks with my Ally checking account then I have been with my iGobanking account in over a year.
We all try to do our best to maximize the return we get on our money. It has driven an entire subsection of the banking industry to cut costs and offer online savings accounts. The rates the banks offer vary as much as the interfaces they offer for you to manage you accounts. I constantly see reviews, articles, and even rate lists that tout the highest rates as though that is the only thing that matters. I have learned the hard way there is a lot more to an online banking account than just interest rate.
Deposit Holds
One of the things you have probably never thought about when opening an account online. I know I didn’t think about it. I am used to holds on transfers and checks bu when I make a direct deposit transaction I expect it to be direct and immediately available, that isn’t always the case. I have been using iGoBanking’s Online Checking Account for a while now but I am finally wising up and getting the hell out. A portion of my paycheck is direct deposited on Mondays, they hold it for three days so I don’t have access to it until Thursday/Friday. This is unacceptable for a checking account. In my savings it doesn’t matter but checking I “need” that cash. Check before you open an account and make sure they don’t hold your direct deposits.
Transfer Limits
Most online accounts limit the amount you can transfer at one time, and the amount you can transfer in any given day or month. These limits don’t mean a lot to people like me who don’t have a ton of cash but when you are looking at $50k+ in an account you have to be prepared for the reality that you may not be able to get all that money in just a couple of days. Check with your bank and make sure you know what their limitations are on transfers.
ATM Fees
When you are looking for an online checking account ATM locations and fees are far more important than the interest rate. When you are making 2% or less on a minimal average balance the ATM fees you pay will murder any chance you had at earning interest. Most banks are only members of a specific ATM network which you can use surcharge free, anywhere else you have to pay. You should check and make sure the ATM’s are convenient to where you live, work or play. Otherwise you are better off sacrificing interest rates for an easier to access ATM. These ATM fees are another thing that has killed me with my current online checking account.
User Interface
While not directly related to your interest earnings the user interface makes a big difference in how you interact with your online account. A well designed interface makes you feel like you are dealing with a professional bank who care about your experience. Not only does it increase your confidence in the bank it also allows you to more easily manage your money. The bad part about interfaces is you don’t really know until you open the account. To get a little more insight you can look to reviews for more details.
Customer Service
Finally customer service is important when you need some help you want to know you can get it easily. One of the areas online banks cut costs is on their customer service availability. They either aren’t available, or they aren’t easily accessed. It makes it difficult to get the answers you need and can make a big difference in your experience with a bank.
What other things should you look for in your next bank account?
Recently, when visiting MyFICO.com, I looked up the question, “How do I go about building my credit history.” This website that’s the authority on credit scores gave me two options:
- Apply for and open a new credit card.
- Open a secured credit card.
Wait a minute…does that mean that in order to get a credit history, I have to get a credit card? After a bit of research, I was pleasantly surprised to find out the answer is NO! While you will need a loan in order to build a credit history, that loan doesn’t have to come from a credit card company. There are several ways to build a credit history and get a credit score without getting a credit card:
- Borrow from Yourself – This is the easiest method to establish your own credit history without a credit card. Buy a Certificate of Deposit (CD) from a bank. Then take out a secured loan against the CD for the same amount of time. Put the money you borrowed in a high-yield checking account. Then use the money you borrowed to payback the secured loan. You’ll be establishing a credit history and earning interest on your checking account and CD. There are some downfalls to this method. You need the starting capital to fund the CD. You could end up paying more interest on the secured loan than earn through your CD and checking account; however, it’s probably less than what you’d pay in fees and interest if you used a credit card. Just make sure to weigh the true costs before going down this road.
- Federal Student Loan – There are several requirements to be eligible for federal student aid however, an established credit history isn’t one of them. As long as you’re going to a school that participates in federal student aid programs and meet the other requirements, you can take out a federal student loan. The interest rate for a new subsidized and unsubsidized loan generally has a fixed interest rate of 6.80%, which is substantially better than a typical credit card interest rate. The only catch is that your lender may not begin reporting the loan until you begin paying it back. So if you wait until after college to begin paying back your student loan, it could take years to establish a credit history.
- Co-signing a Loan – Many banks will provide a loan if you have a co-signer with a good credit history. However, it may be difficult to get someone to co-sign on a loan, because of the inherit risk associated with it. If you’re lucky enough to get a co-signer, make sure that you make timely payments because with this method, it not just your credit history at risk. Your payment history will also affect the co-signer’s credit history. An alternative is for you to be the co-signer. If you know someone that has a high credit score, is responsible and taking out a loan, you can “game the system” by being their co-signer. As they make timely payments on their loan, they’ll be helping you establish a credit history . Be warned, if they default or make late payments, this will negatively affect your credit score.
While you’re building a credit history, it’s a good idea to keep an eye on your credit report. You can sign up for a credit monitoring service or get your free annual credit report at AnnualCreditReport.com. Make sure to review what’s listed and dispute any credit mistakes. If there are mistakes with more than one credit bureau, you’ll need to address them separately.
