News coverage of the impact of financial reform has been predicting the demise of free checking ever since financial reform required overdraft charges to be opt-in. So, when I received an envelope from Citizens Bank stating “Important Information”, I was immediately nervous.
Sure enough, it was a letter stating that my formerly free bank account would now run $4.99 per month, unless I kept a balance over $1500 or made five purchases a month.
This is annoying because my citizens account isn’t my “real” account. Several years ago, I switched us to an E-Trade bank account. There are several internet-only banks out there, but is one of the fullest featured compared to banks like ING:
- Ability to write real checks
- Free use of any ATM in the country (they immediately reimburse the fee), no limits
- Online bill payments
- Great interest rates (at least at the time – now interest rates have fallen everywhere)
I have been extremely happy with E-Trade. The only downside was that the only way to deposit a check was to mail it in. I’m fairly comfortable with online banking (hey, back in the day, I was one of the software engineers who worked on BankBoston/Fleet’s online banking system), but there is something I really like about putting my checks into an ATM and knowing that the bank got them. I get nervous mailing them through the post office.
And here enters my Citizens account. I opened a free account with them, and then whenever I needed to deposit a check, I would deposit it there, and then transfer it to my E-Trade account. Kind of a lousy deal for Citizens, since they were silly enough to offer a free checking account, but who was I to complain?
While I have never bounced a check in my life, the hordes of people who regularly failed to balance their checkbooks have been subsidizing my free account. Now, Financial Reform has swooped in to protect them, and my gravy train is over.
As annoying as this is to me personally, I think that overdraft fees are ridiculous, and I believe in the financial reform that is cracking down on them. Citizens themselves once offered me a $30 overdraft protection for $5/month. What a ripoff! The protection would have been covered in six months. It was just a fee that would prey on the poor.
So now what? As much as I preferred using an ATM to deposit checks, I’m not going to commit $1500 to sit in a bank account for the privilege, and I’m definitely not paying $5 per month. I’m just going to have to put my faith in another part of the US government – the post office – to get my checks to E-Trade safely.
So long, Citizens. I’ll miss you, but I don’t think you will miss a customer like me.