F E D E R A L D E P O S I T I N S U R A N C E C O R P O R A T I O N
Summer 2012
ALSO INSIDE
Tips for finding and
managing a mortgage
The risks of adding
others to bank accounts,
safe deposit boxes
and loans
Getting the Most From
Your Bank Account
• How to Choose What’s Best for You
• What to Know About Payment Cards
• Things to Consider Before Changing Banks
Summer 2012
ALSO INSIDE
Tips for finding and
managing a mortgage
The risks of adding
others to bank accounts,
safe deposit boxes
and loans
Getting the Most From
Your Bank Account
• How to Choose What’s Best for You
• What to Know About Payment Cards
• Things to Consider Before Changing Banks
2 Summer 2012FDIC Consumer News
YOUR BANK ACCOUNT
It’s important to have a banking
product to handle everyday financial
needs that range from making
payments to getting paid. There also
is no shortage of options — from
different kinds of checking accounts to
products such as prepaid cards that, at
first glance, may seem like convenient
alternatives to bank accounts but may
lack the federal protections for insured
accounts. How can you choose what’s
best for you?
FDIC Consumer News has developed
a 10-question self-test to help you
focus on what you want most in a bank
account, plus additional tips to help
you narrow your choices and make a
good decision. Ready to get started?
Questions to Ask
1. How do I want to deposit money
into an account? If you’re not already
having your payroll, pension, Social
Security payments, unemployment
benefits or other income directly
deposited into your bank account,
look into it. Direct deposit may save
you money on fees, plus you will
receive the payment more quickly than
depositing it in person.
For checks that you need to deposit
into your account, consider how
you’d prefer to do that (in person,
electronically, by mail) and if a bank
you’re looking at would be a good
choice. For example, you might be
interested in depositing checks using
a smartphone, but not all banks offer
that service. Or, if you like to make
deposits at a teller window, find out the
hours you can do so.
2. How do I plan to pay bills or
purchase goods? More people are
using debit cards instead of writing
checks to draw money from their
checking account, in part because of
the convenience and speed. The FDIC
recently conducted a pilot program at
nine institutions offering electronic,
card-based accounts and found that
What’s the Right Account for Your
Everyday Banking Needs?
Questions and tips to help you narrow down the choices
“checkless checking” can reduce the
risk of overdrawing accounts.
If you want to pay bills online, explore
what the bank offers and whether there
are any fees. “The potential benefits
of online bill-paying services include
a confirmation that you paid the bill,
and with some institutions, a guarantee
that any payment you originate will be
delivered on a set day,” noted Luke W.
Reynolds, Acting Associate Director
of the FDIC’s Division of Depositor
and Consumer Protection. “Some
banks’ bill-payment services will even
electronically deliver your bills from
certain companies you do business
with, which can save you time and
hassles.” These online programs vary,
he said, so check on any limitations,
such as on what bills can be paid
through the service.
Also, if you’d like to electronically
pay other people (as opposed to
companies), find out about your
options. They may include payment
by phone, computer or smartphone.
Again, ask about any limitations and
fees.
3. Do I want to monitor my account
electronically? Telephone and online
access to accounts is increasingly
becoming the norm. But if you want
to monitor your account activity and
balance using a smartphone or tablet
computer, find out whether these
features are available.
Electronic alerts from your bank can
save you money. Options may include
text or e-mail messages if your account
balance reaches a threshold you set (say
$10), so you can curtail spending or
add funds to avoid overdraft fees.
4. What are my options for
withdrawing cash? Find out if the
bank has branches or fee-free ATMs
you can use close to where you think
you need them, perhaps near your
home or work.
You also may be able to get cash
from your account when you make a
purchase with a debit card at certain
merchants, but this can lead to
unnecessary expenditures.
5. Are there features that can help
me put more money into savings?
Many consumers find that setting
their savings on auto-pilot — by
automatically transferring money into a
savings account on paydays or at other
regular intervals — is the easiest way to
build a rainy-day fund or achieve other
savings goals. “Paying yourself first is
the most effective way to ensure that
you set money aside because, as the
saying goes, ‘What you don’t see you
probably won’t spend,’” noted Lekeshia
Frasure, Acting Chief of the FDIC’s
Outreach and Program Development
Section.
6. What will the new account cost?
Pay careful attention to how much
money you may need to open and
maintain the account. For example,
what does the bank charge for
falling below the minimum balance
requirement?
Making Your Decision
By now you should have a better idea
of the features you want in a bank
account and how much they’re likely
to cost. Here are other questions to ask
before you make a final decision:
7. Have I compared several
institutions? Look at each bank’s
disclosure of fees and key terms. The
YOUR BANK ACCOUNT
It’s important to have a banking
product to handle everyday financial
needs that range from making
payments to getting paid. There also
is no shortage of options — from
different kinds of checking accounts to
products such as prepaid cards that, at
first glance, may seem like convenient
alternatives to bank accounts but may
lack the federal protections for insured
accounts. How can you choose what’s
best for you?
FDIC Consumer News has developed
a 10-question self-test to help you
focus on what you want most in a bank
account, plus additional tips to help
you narrow your choices and make a
good decision. Ready to get started?
Questions to Ask
1. How do I want to deposit money
into an account? If you’re not already
having your payroll, pension, Social
Security payments, unemployment
benefits or other income directly
deposited into your bank account,
look into it. Direct deposit may save
you money on fees, plus you will
receive the payment more quickly than
depositing it in person.
For checks that you need to deposit
into your account, consider how
you’d prefer to do that (in person,
electronically, by mail) and if a bank
you’re looking at would be a good
choice. For example, you might be
interested in depositing checks using
a smartphone, but not all banks offer
that service. Or, if you like to make
deposits at a teller window, find out the
hours you can do so.
2. How do I plan to pay bills or
purchase goods? More people are
using debit cards instead of writing
checks to draw money from their
checking account, in part because of
the convenience and speed. The FDIC
recently conducted a pilot program at
nine institutions offering electronic,
card-based accounts and found that
What’s the Right Account for Your
Everyday Banking Needs?
Questions and tips to help you narrow down the choices
“checkless checking” can reduce the
risk of overdrawing accounts.
If you want to pay bills online, explore
what the bank offers and whether there
are any fees. “The potential benefits
of online bill-paying services include
a confirmation that you paid the bill,
and with some institutions, a guarantee
that any payment you originate will be
delivered on a set day,” noted Luke W.
Reynolds, Acting Associate Director
of the FDIC’s Division of Depositor
and Consumer Protection. “Some
banks’ bill-payment services will even
electronically deliver your bills from
certain companies you do business
with, which can save you time and
hassles.” These online programs vary,
he said, so check on any limitations,
such as on what bills can be paid
through the service.
Also, if you’d like to electronically
pay other people (as opposed to
companies), find out about your
options. They may include payment
by phone, computer or smartphone.
Again, ask about any limitations and
fees.
3. Do I want to monitor my account
electronically? Telephone and online
access to accounts is increasingly
becoming the norm. But if you want
to monitor your account activity and
balance using a smartphone or tablet
computer, find out whether these
features are available.
Electronic alerts from your bank can
save you money. Options may include
text or e-mail messages if your account
balance reaches a threshold you set (say
$10), so you can curtail spending or
add funds to avoid overdraft fees.
4. What are my options for
withdrawing cash? Find out if the
bank has branches or fee-free ATMs
you can use close to where you think
you need them, perhaps near your
home or work.
You also may be able to get cash
from your account when you make a
purchase with a debit card at certain
merchants, but this can lead to
unnecessary expenditures.
5. Are there features that can help
me put more money into savings?
Many consumers find that setting
their savings on auto-pilot — by
automatically transferring money into a
savings account on paydays or at other
regular intervals — is the easiest way to
build a rainy-day fund or achieve other
savings goals. “Paying yourself first is
the most effective way to ensure that
you set money aside because, as the
saying goes, ‘What you don’t see you
probably won’t spend,’” noted Lekeshia
Frasure, Acting Chief of the FDIC’s
Outreach and Program Development
Section.
6. What will the new account cost?
Pay careful attention to how much
money you may need to open and
maintain the account. For example,
what does the bank charge for
falling below the minimum balance
requirement?
Making Your Decision
By now you should have a better idea
of the features you want in a bank
account and how much they’re likely
to cost. Here are other questions to ask
before you make a final decision:
7. Have I compared several
institutions? Look at each bank’s
disclosure of fees and key terms. The