Banking
It's easier to track your budget if you have one account for paying bills - it gives you a single statement to reconcile with the budget. For couples this should be a joint account, where either one can pay the bills - just be sure you balance the checkbook regularly, and you both use the same method.
Does your checking account pay interest? It should. Some banks offer interest bearing checking accounts with a minimum balance. If you don't have enough to maintain the monthly balance, at least get free checking, consider this:
If you have a montly average balance of say, $200.00, and you have a monthly fee of say $7.00, you're paying 3.5% per month for the privalege of letting them use your money - by the way, that's an astounding 42% uncompounded interest.
If you have free checking, you won't be paying 42% interest, it's like getting 42% instead.
Where else can you get 42% on your investments?
When you shop for a checking account consider all the costs:
- Maintenance fee - as above, it can cost you an outrageous percentage
- Check writing fee
- ATM fee
- Teller fee
- Debit card fee
- Check purchase fee
All of these fees can add up to what a loan shark would be jealous to receive. For example:
| Fee | Amount | Times | Monthly Total |
|---|
| Maintenance fee: | 7.00 | each month | 7.00 |
| Check writing fee | .10 | 20 checks | 2.00 |
| ATM fee | 1.00 | 5 transactions | 5.00 |
| Teller fee | 1.00 | 4 transactions | 4.00 |
| Debit card fee | 1.00 | 8 transactions | 8.00 |
| Check purchase fee | 12.00 | every 6 months | 2.00 |
| Total | | | 28.00 |
|---|
If your average balance is $200.00 then you're paying 28/200 or 14% interest each month, that's 168% interest annually. If you get a free checking account you'll save $336 per year - keep that up and soon you'll have the money to keep the minimum balance for an interest bearing checking account!
Consider putting all your accounts in the same bank, checking, savings, CD's etc. Some banks give you a better deal if you have more money in their system.
Look for other services too. Our bank has free on-line banking, and for a certain minimum balance free on-line check writing. This means we can check our balances, get statements, transfer money, all without leaving the comfort of our home, or even from work. On-line check writing lets us send bills out without paying for envelopes or stamps, and we have a certified record of the transmittals.
Other services you should have are direct deposit, direct payment of bills (utilities, insurance, etc.), ATM machines, extended banking hours, and even drive-up tellers.
Don't write bad checks! They'll cost you more than you can fathom.
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