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How Do You Feel About Online Banking?
Compete, a site that tracks traffic metrics and analyzes Internet trends, has a couple of new polls out on how consumers use online banking and what they think of it.
These are some interesting results — but, like Bankrate's recent survey, it's not entirely clear if this is discussing online banking from brick and mortar banks or online-only banks.
For example, easily more than 1% of those surveyed (probably) have opened a new account at an online-only bank. But at their brick and mortar's online site, they may not have.
How do these survey results compare to your online banking habits? Let us know in a comment below.
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Online Banking is Pricey, But For Who?
Bankrate recently announced the results of its 2008 Checking Study and found some interesting results:
The 22 checking accounts we surveyed at 18 online institutions show that they can be somewhat pricey, especially if you're intent on earning interest, but at least they pay decent interest. You may find that abiding by a couple of minor stipulations will eliminate fees.
Honestly, I'm not sure Bankrate did a great job of really looking at online banks — and it's a little confusing just exactly who they surveyed.
The text above says "online institutions" — implying online banks — but their methodology says they "surveyed one interest checking account and one noninterest checking account at each of the largest banks and thrifts in each of 25 large markets."
That seems to imply they are looking at the online versions of brick and mortar banks, but I'm not totally sure.
If you're looking to open an online checking account, the best is ING's Electric Orange.
When you open an account with at least $250, you'll get an automatic $25 deposited as a bonus.
It's got no fees, no minimums and is super-easy to use.
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How to Easily Overcome Your Bad Financial Choices
Personal finance is about 95 percent mental and 5 percent physical. Once you've put the right system into place, you just have to block out all the noise and plow ahead.
So as much as you may have been led to believe otherwise, the biggest thing blocking your success is you.
You are your biggest investment — and sometimes you make the wrong decisions. That's simply human nature.
The 7 Psychological Money Traps
Bankrate has a great story about 7 'psycho' money traps and how to beat them, highlighting how we cause ourselves problems.
Their seven mental money traps:
1. The lure of 'free'
2. The 'anchor-price' persuasion
3. The instant-gratification attraction
4. The dollars-to-donuts decoy
5. The separate-buckets blunder
6. The 'sacred-fund' slip-up
7. The lost-money fallacyThese are all great examples of how we naturally make poor financial decisions. You're not the only person who's ever made these mistakes. But you can easily overcome them.
Use Automation to Remove the Human Element
If you want to ensure that you aren't blocking your own financial success, automate the processes.
Want to save for a new car? Set it and forget it.
Leave your paycheck sitting around instead of cashing it? Get direct deposit.
Working hard to time the stock market? Automate your investments and you'll benefit from dollar-cost averaging.
When you take the 5 percent action required, you've set yourself up for financial success. Turn around your bad habits and start to feel comfortable with your decisions.
When Technology Can't Help You
Online banking and the Internet can do a lot to improve your money management shortcomings, but they can't do it all.
No one's going to stop you from buying that videogame you don't really need.
No one's going to stop you from living beyond your means (except maybe the bank, and you don't want to go there).
No one's going to stop you from being lazy and putting off the process to your financial freedom.
You've got to be the one who steps in and makes smart decisions. The tools are all there, but you need to make it happen.
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HSBC Direct Back Up and Running After Outage
After their system problems last week, HSBC Direct says they're back up and running.
Dear JASON,
As a follow-up to my email last week, I am pleased to let you know that our systems have now returned to normal operating conditions. As always, we continue to monitor all systems closely and will let you know if there is any change in status. I can confirm that all customer information, data and funds were secure at all times.
In the event that you were charged fees as a direct result of our system issues please know that these will be refunded. If any deposits were delayed you will receive interest from the date they were originally deposited.
Should you have other questions about your HSBC Direct account please submit your question through "BankMail" when you are logged into your account, or contact our Customer Service team at 1-888-404-4050.
Providing consistent world class service levels is our priority and is something that we failed to do last week. We fully appreciate how important it is for you to have reliable access to your online accounts and we are committed to providing this. Again I apologize for any inconvenience you may have experienced.
Thank you again for your support and for saving with HSBC Direct.
Sincerely,
Kevin Martin
Executive Vice President,
Head of HSBC Direct U.S.The Consumerist has a bit more about how much the outages affected customers, especially people who were waiting for their direct deposited paychecks to clear.
The widespread problem is limiting access to HSBCDirect accounts, and at least 8,000 Catholic Health System employees up in Buffalo are still waiting for their direct deposit payments to materialize.
…
The bank is keeping select upstate branches open late so Catholic Health System employees can come in and trade their pay stubs for cash. As for affected HSBCDirect customers, the bank promises to "return full–system functionality to you as soon as possible."
Glad to hear everything is working right again. You're not having any problems with HSBC, are you?
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Bank of America's 3 Steps to Green Banking Online
We've talked a lot about how convenient online banking is, but there's also a very green aspect to it, too. Being green isn't my top priority, but it's definitely an added bonus when it comes along with convenience.
While it may or may not actually save 17 million trees, Bank of America is pushing a "Think Green, Bank Green" message to get its customers into online banking.
Online Statements Getting your monthly statements online keeps you organized and cuts clutter
Bill Pay Scheduling bill payments online saves you time, postage, potential late fees, and more.
eBills Paying bills online? Why not go for ultimate convenience and receives them online, too.According to the promo, BofA customers using the three steps have saved a total of 8,174 tons of paper.
Like I said, going green isn't the reason I would be banking online, but it's a very compelling reason for certain folks.
It's a smart move by Bank of America to shape their message this way, especially if their customers are hesitant to bank online.
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Online Banking Customer Satisfaction Up, Survey Says
Customers are increasingly satisfied with their online banks, according to a new survey from ForeSee Results (says the AP).
The measurement comes from the University of Michigan's American Customer Satisfaction Index, which gave online banking an 82 out of 100, up from 73 in 2003.
The reading of 82 was higher than customers gave banks overall — 78 in 2007 — suggesting they are more pleased with banks' online operations than with branches and call centers. The score is also strong compared to other arenas: Online retailers, the highest-scoring category measured by the ACSI, recently scored 83.
Satisfaction is up partly because people are more comfortable banking online than they used to be, said ForeSee Results president and CEO Larry Freed. Other big reasons he cited include efforts by banks to boost security, allow more types of transactions, and ease navigation.
For the most part, I'm content with the online banks that I use. But there's still a lot they could do better.
First, get rid of ridiculous log in methods. HSBC is the worst when it comes to this, since you have to use their ridiculous virtual keyboard that constantly gives me errors.
Let me add as many external accounts as I want. E-Loan says you can only have one external account "for security," but that's a load of bull. I should be able to take my money wherever I want to go, whenever I want to go.
Speed up transfers. There's no reason it should take so long for my money to get from one account to another. Yes, there are some ACH issues surrounding this, but once that's done, my money should be where I want it.
What would make you more satisfied with your online bank? Leave a comment below.
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ING Direct Has "Record Savers" in 2007
ING Direct, probably the best known online bank, had "a record number of new savers, deposits and home mortgage loans" in 2007, according to an email from CEO Arkadi Kuhlmann sent to its customers.
Dear Jason,
I am happy to report that ING DIRECT's 2007 financial results are complete. Your confidence in us helped us deliver a record number of new savers, deposits and home mortgage loans. Further, we acquired ShareBuilder so we could offer you a low cost way to invest in stocks and ETFs. I'm proud of our first 7 years, but there's work to be done.
Global financial markets ended 2007 with many challenges ahead. While ING DIRECT avoided the sub-prime mortgage problem, we understand that this housing crisis threatens the well-being of countless families and, in the end, it will be seen as a major failing of the mortgage industry and its regulators.
The fact that ING DIRECT was not adversely affected is a testament to our operating philosophy that, as Americans, we should only buy houses we can afford. That way we can keep them for years to come. We believe a mortgage is a contract that both parties should execute in good faith and expect to see through to its conclusion. We will not waver from our sworn promise to provide you with great value, service and convenience.
Thank you for your continued trust in us. Stay tuned in 2008 for new ideas we'll offer to help you save your money.
Arkadi Kuhlmann
The CEO of SavingWhile ING hasn't been delivering the leading interest rates on its online savings account for some time, they have continued to innovate with new products like the Electric Orange checking account and business online savings account.
2007 also saw ING acquire NetBank — even if there were some problems during the transfer.
Kuhlmann has been an outspoken advocate of understanding you financial situation (he's not the only one) and has argued that, even though ING only offers adjustable rate mortgages, they ARE right for some people.
I don't keep any money with them anymore — there are too many better paying options — but I know that some people do because of the ease of use and dedication to the company. I wouldn't do it, but more power to them.
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Free $5 Starbucks Gift Card for Online Banking Survey
E-Loan, where I keep an online savings account, is giving away $5 Starbucks gift cards for filling out an online banking survey.
Dear Valued Customer -
We are evaluating and enhancing our online banking website and would like your opinion on what bank products and features are important to you.
You will receive a $5 Starbucks Card to thank you for your participation in this short survey.
In accordance with our privacy policy, we will not sell or share the information you provide with third party marketers.
Thanks for helping us.
Sincerely,
Virginia Sullivan
SVP, Internet Banking
E-LOANClick here to access this survey:
I did it — hopefully my gift card will come in less than the advertised 4 weeks.
Give it a shot. You don't seem to have to be an E-Loan account holder to do it.
There is one problem, however: what can you get at Starbucks for only $5?
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What Did You Do Before Online Banking?
Open thread here: what did you do before online banking?
This might sound like a silly question, but for as long as I've been managing my money, I've been banking online. I honestly don't know life without it.
But you might.
How did you manage your money before you had access to the Internet? Did you use software like Quicken, or keep a hand budget?
How about balancing your checkbook? (I've never done it before.)
Did you (do you) keep all your receipts? I just check my charges online, since I pretty much only use a debit card.
Let us know: what did you do before online banking?
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Where Did My Money Go?
You know you have to save money. You'd like to start investing. You'd like to go on a vacation.
But you don't have the money for it. Each of these scenarios leads you to the question: where did my money go?
This is the fundamental question to beginning your financial responsibility. The first step in simple money management is to spend less than you earn.
Chances are you know how much money you make. But do you know exactly how much money you spend, and where it goes?
Being as detailed as possible in tracking your spending is a huge first step to proper money management.
Here's how I do it.
I keep receipts for nearly every transaction I make, both cash, debit and credit card purchases. When I get home, I put them on my desk to add to my budget notebook, which tracks all my spending.
The most important receipts to ensure that you get are for purchases with tips and gas purchases. You'll find out why in a minute.
I also log onto my checking account online all the time, to double check that my transactions are correct and to find out when my monthly bills have been automatically deducted.
Online banking also helps when I forget to get a receipt or lose it somewhere in the process.
As I said before, certain receipts are more important to keep: gas and purchases with tips. This is because, when you buy things with a debit card, the correct transaction amount does not appear until the payment has cleared.
When you go out to a restaurant and pay (with tip) on your debit card, you'll notice that the pending transaction only deducts the amount for the meal: not the tip. So you can't rely on this number instead of a receipt — at least not if you add the purchase to your budget that day.
On the gas side, funds do not get deducted from debit cards (even those acting as credit cards) automatically. The process normally takes a few days.
So, I always keep my gas receipts to add to my budget that day, so I don't wait for it to appear online and forget about adding it.
In addition to keeping a budget with my monthly spending, I track my expenses online via Yodlee. The number isn't as precise as my hand-written budget, but once you've categorized a few of your transactions, Yodlee does the rest.
Want to start saving more money? Find out where your money is going first.
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