PocketCoinage

I was never one for carrying a balance on my credit cards.  Everytime the bill came in, I would pay it off immediately.  The problem with me was I had way too many cards; From store brands to your standard Visa and Mastercard.  I had about 6 in total all with different due dates.  This just made my finances more complex.  With the complexity came more stress, “Did I pay that credit card off?” So I decided that enough is enough and I closed out all three store cards about three weeks ago.  Let me tell you, it was very liberating!

Funny Story
Just yesterday I decided to cancel two more credit cards: my Visa and Mastercard.  These by far were the most fun to cancel because of the representatives’ responses.

The first representative at Bank of America told me, “What?  You can’t cancel your card now!  It’s springtime!” That was pretty comical trying to keep me on as a customer.  Being that it’s springtime has nothing to do with closing my credit card, but okay.  The account was closed and we had a nice chat about the weather between Maine (where she was located) and New Jersey.

The next representative at Wells Fargo was very boring. He brought up the fact that my “score with them would be lowered”.  One can only imagine that would be my credit score; I told him that was fine.  Once the account was closed, he told me to “feed the card to my dog” and that it was as good as “feeding him chocolate.” With his monotone voice I could not tell if he was joking or not.  However, you can clearly tell he doesn’t enjoy his job.

Right now I am left with one credit card that I have open for “just in case”.  I do not plan on using it, but there could always be a time between now and when my emergency fund exceeds that credit limit.  I’ll feel more comfortable about getting rid of it once I have my student loan paid off and my emergency fund built up.  Overall, I have not used any credit since December; everything’s been on a cash basis.  It really has kept my spending under control.  When I would charge things with the credit card, I would find that I would purchase more goods.  Which, in return, didn’t give me the leverage needed to pay down my student loan debt as quickly as possible.

More Reasons to Close the Cards
Canceling the cards was not only for personal relief, but to relieve some future financial burdens.  Once I heard about what these big banks are planning, I decided it was for the better to closet down the cards.

According to this WalletBlog.com article, “…Bank of America recently announced plans to apply $59 annual membership fees to about 5% of its credit card customer base.”  The worst of the news came from my grandma.  Bank of America is currently charging her $4 for each check image printed on a statement!  She incurred $12 in fees last month for doing something your normally do with a checking account: writing checks!  This weekend I will be taking her to a local community bank and patronize their business.  At least they still have a soul!

Have you been used by the mega banks?  If so, do you still do business with them?

Automatic transfers can help make your life easier.  They can save you time, build savings slowly, or even pay bills so you do not incur a late fee.  However, if you are not careful, you can potentially find yourself being charged bank fees!

Here are some examples that could lead to over drafting on your bank with automatic transfers:

• Irregular income
• Overspending
• Delayed pay due to a holiday
  • This seems to happen where I work.  If a holiday falls on a Monday, we would not see the money in our account until Friday.  We normally get paid on Thursdays.

Personally, the only automatic transfer I have is right from my paycheck to the 403b.  The only other automatic transfer I would consider is putting money away into savings directly from my paycheck.  This is before I have the chance to spend it!  I would never have an automatic transfer pull from my checking account on a certain day.  I know too many people that have been hit with bank fees from their bank due to automatic transfers.

I perform all my transfers and pay bills manually once I know my check cleared and the funds are available to me.  It takes me about 10 minutes or less every pay period.  This method has probably saved me from countless bank fees over the years.

If you are considering automatic transfers to pay bills or save, be sure you will have enough money on your account when the time comes.  Otherwise you may see some nice bank fees on your next statement.

Have you ever been hit with bank fees due to automatic transfers?

Last week I joined the local credit union.  I’ve been putting this off for a long time actually.  What mainly kept me back was the poor interest rates being offered through the credit union at work.  For the longest time, I though I could only join one through an organization.

Listening to a local radio station, I heard them mention a website to find local credit unions.  After all the fun we had the past few years with bailouts for the “national banks”, I wanted to take my money elsewhere.  My goal was to find an institution that’s stable, local, and here to stay with me.  Through research, I found out that one of the requirements to join one is to just live in the community.  Their interest rates are very competitive for CDs and savings, plus they have low interest loans.

After finding this excellent news, I took Dasha and we went to open our accounts.  Upon stepping in, I noticed something different about the credit union:  you are treated as an individual, not as an account number.  It was an excellent experience signing up for an account there.  One huge advantage is I am able to deposit and withdraw at ANY credit union in the country; they are all linked together!  This is extremely useful for when I travel and do not have a “national bank” in the area.  So far I have not found a single disadvantage of signing up.

To sum it up, here are some of the advantages of a credit union:

• They are local and provide services for others in the community
• You may only need to live in the community to join
• They offer competitive rates on their services
• ALL the credit unions across the country are linked together allowing you to deposit and withdraw while traveling
• They have all the services of a “national bank”, such as online banking and free checking

Are you apart of a credit union?  If not, have you been thinking about joining a credit union?