Key Financial Secrets
Your Bank Won't Tell You
Banks seem to be an unavoidable part of life in many parts of the world. They can provide great relief for people and even open up new opportunities with the loans that they offer. That said, banks are in the business of making money, and thus it would be wrong to consider your banker to be your best friend.
This uneasy relationship is clearly illustrated by some of the things that your banker is trying to keep FROM you. This article will highlight a few of these Secrets your bank won't tell you.
1. You Can Probably Do Better On Your Savings Account Interest Rate Somewhere Else
When you go into a given bank and open a savings account, the representative will probably endlessly laud the great features of the savings plan. They will probably also offer you one of an array of other financial products, including CD's, IRA's, and Money Market accouts. In reality, almost no banks offer interest rates that are anywhere near a high as they could be. For example, the national average savings account rate stands at a paltry 0.06%. People who take the time to shop around for other forms of investment can easily earn a minimum of 3 percent or even better.
2. They Change Interest Rates Without Any Warning
Credit cards can be a lifesaver in times of dire need, but don't expect your bank to necessarily reward you for using one of their cards. And if you have bent a rule or two, expect to be severely punished. For example, many banks will raise interest rates to as high as 30% if a card user makes even the most innocent default twice during a year. Many other customers who have done nothing often find their interest rates mysteriously raised - with no explanation.
3. Just Applying For An Account Can Damage Your Credit Score
You happily walk into the local branch of a bank you wish to open an account at, and present your information for perusal. But what you don't know about this situation can definitely hurt you. When a new customer attempts to open an account, many banks now perform what is referred to in the industry as a "hard credit inquiry". This can be good for the bank, but in the process this can and often does damage the credit score of the prospective customer. So much for gratitude.
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4. They Will Charge You All Sorts Of Hidden Fees
When you walk into a bank for the first time and the customer service rep offers you a spanking new account with generous terms, you will most likely jump at the chance. But this is only the beginning of the story. As we already know, banks are in the business of making money - usually off of YOUR money - and the friendly introductory terms almost amount to a bait and switch con game. Here is a list of some hidden fees that your bank is just itching to charge you.
* Overdraft fees.
These fees are the way your bank punishes you if you withdraw even slightly more money than you have in your account. These fees tend to be paid by a small percentage of bank customers - 10% in many cases - but the bank patrons who usually have to pay these often exorbitant bills are in many cases the poorest.
* ATM fees
These are the bane of banking life. Banks know that people tend to carry limited amounts of cash with them and will eventually require the services on an ATM, and that is when they hit them the hardest. How hard? In many cases, when a bank customer is forced to use an out of network ATM, they will be charged a fee by the bank that owns the machine AS WELL as their own bank. Not too fair.
These are by no means the only sneaky ways that the banks tend to operate, but they do serve to give people an insight into some of the things that go on behind the scenes. Buyer, beware.
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