End of free checking accounts near, this makes me mad

[AlternateEgo]

I work at a bank and they have also did away with their rewards program due to the "Durban Act". We aren't allowed to discuss it with our customers either. Basically merchant processing earned money and now they aren't so we can't rewards our customers.

We don't have a "free account" although if your account is active (meaning you get a direct deposit or 5 transactions) during the month, your account maintainance fee is waived.

 

[jodifla]

Boy, am I the only one who remembers when checking accounts weren't "free?"

They didn't start doing this until the 80s, as I recall. And then it was tied to having a direct deposit at the bank or a minimum balance.

 

[sk!mom]

How many out there fear that we might be losing our free checking accounts here soon do to the debit card reform. I have read that banks might limit how many times a month you will be able to use your debit card or perhaps limit you to a high dollar amount to use it. This really has my blood boiling.

"Fear" is way to strong a word. I'm interested to see what happens but I'll wait until my bank announces what it will do. I rarely use my debit card- maybe a few times a year just to get cash. I prefer the rewards and protections of credit cards and then pay in full every month.

 

[travelfanatic]

It was interesting that I ran across this thread today because I was just in my bank this morning on an unrelated issue. I bank with Suntrust by the way. Anyway, the customer service rep proceeded to explain I would be getting a letter in the mail soon about changes effective November 1st. He said there will be no more "Free" checking unless you have direct deposit or carry a min. avg balance of $500. O.k. no problem for me on that as I have direct deposit so I should not have any charges. He also said they will be charging $5 flat fee for debit card use. He said you can charge 1-1000 times and it will be a flat $5 per month. Not to bad IMHO. I asked him about them doing away with debit card rewards as I have sky miles and he said he has not heard of them doing away with that but it's not out of the question. So, I hope that helps someone for what it's worth. I feel a little better about the situation now, $5 a month I can handle for convenience.

 

[fireflymedic]

My bank use to give a cash back for Debt card use,they just sent a letter saying this is the last month I will be getting that.

 

[neatokimmo]

I write maybe 10 checks a year and get cash from the atm with my debit card maybe twice a month. If I had to pay a fee just for those few transactions I would have to rethink which bank I use.

No way would I pay $5 a month to use a debit card. A credit card, sure, you are using someone elses money for your convenience. But a debit card is your money.

 

[HeatherFeather]

Also got the letter from USAA and confirm that they are discontinuing the .5% cashback from use of their debit card It looks to me that this will be the only change for us. We will still have free checking and the other USAA goodies.

 

[JB2K]

Also got the letter from USAA and confirm that they are discontinuing the .5% cashback from use of their debit card It looks to me that this will be the only change for us. We will still have free checking and the other USAA goodies.

Absolutely -- USAA saw the writing on the wall and polled their bank customers asking which was more important to them - rewards points or free checking. IMO, that's engaging the customer, which is a good thing.

As banks charging for the privilege of using a debit card may be looming near, let me ask everyone this: What would then be the diffference between banking at a traditional bank and using a prepaid MC/Visa/AmEx card?

Something to think-about...

 

[bettymae1121]

Absolutely -- USAA saw the writing on the wall and polled their bank customers asking which was more important to them - rewards points or free checking. IMO, that's engaging the customer, which is a good thing.

As banks charging for the privilege of using a debit card may be looming near, let me ask everyone this: What would then be the diffference between banking at a traditional bank and using a prepaid MC/Visa/AmEx card?

Something to think-about...

For me it wouldn't matter, I don't use my debit card anyway. I have one, but I only use it for the rare occasion I need cash out of an ATM. I use my credit card for all purchases and pay the bill in full at the end of the month.

I signed up for my checking abount BEFORE the bank bill was passed. In order to get free checking you needed to have direct deposit or 5 debit transactions per month. After the bill passed they changed...exactly nothing.

It costs banks money to manage accounts. For a long time they offset the costs by fees on their other products. Now that the fees on the other products are more regulated (ie they can't jam people up the way they used to) some banks need to start charging for checking again. Or they are charging to get people mad in the hopes that the reform is repealed. Likely it's a combo of both motives.

Ultimately I think the free market will decide. If some banks start charging and others keep free checking - and enough people leave the banks that charge for the banks that don't - I'm sure that we'll see free or at least very very low cost checking accounts making a come back.

 

[MScott1851]

Boy, am I the only one who remembers when checking accounts weren't "free?"

They didn't start doing this until the 80s, as I recall. And then it was tied to having a direct deposit at the bank or a minimum balance.

Nope. I've NEVER had a 'free' checking account. Even the one I have now has a $7.99/month fee that is waived because I direct deposit my paycheck biweekly. The only time i ever use a debit card is at the ATM, and I only write checks as wedding, graduation, or birthday presents, or to repay someone. Otherwise every single transaction, no matter how small, goes on the Disney Visa and gets paid off at the end of each week.

The fraud liability is the biggest issue I have with bank cards. If someone skims your debit card number and cleans out your checking, then you are screwed. If my CC number gets compromised,then all my cash is safe and sound while Visa investigates and im only on the hook for $50. Plus, I don't know why anyone would rely solely on a debit card when you can earn rewards or rebates by using credit cards. I enter every credit card transaction in my checkbook register just like it was a debit swipe. That way I can keep up with how much I owe. Each Friday, I total up and 'readd' that amount, make sure it matches what the CC site says I owe, and make an online payment. I've earned almost $800 Disney dollars this year so far just by doing this. That's our deposit on next years Dream cruise and BLT stay!

 

[Free4Life11]

I'm so sad that banks will collect less fees and merchants will now have higher revenue....not! Crossing my fingers that some will pass on the savings to customers, kind of like Target gives you a 5% discount for using their debit card.

I've never really had free checking and have always had to have a direct deposit to waive the fee, so I think a lot of free checking accounts will simply become free* checking accounts and requiring a direct deposit, paperless statements, etc. It's been this way for me for years, so I'm not to worried.

I wouldn't want to pay a monthly fee to use my debit card, but if that happens I'll just switch to using a credit card or cash.

I really think this is a non-issue and the banks that overreact and start nickel-and-diming their customers WILL see backlash.

 

[DawnM]

Can I ask how you do this?

I am thinking you go to a warehouse place like Costco?

Do you plan all your meals for the month and stick to the plan?

Do you still go weekly for things like fresh produce?

Dawn

We use ours for everything from groceries to gas to doctor's copays...etc. I hope they don't start charging or putting a cap on it.....we buy groceries once a month and spend roughly 700.00 in that one trip, if they limit the use to 50.00 at a time that would be a lot of smaller trips LOL. Guess I'd just use my credit card then and come home, sign on to the site and pay the credit card with my checking.

A lot more hassle but I won't be paying debit card fees or have caps placed on it....too much to think about LOL

 

[carone0318]

The only place that I write checks for is school. I use my debit card as a credit card for everything else because it has the rewards attached to it. Between my kids 2 schools, I write so many checks. I hate it and would prefer if the schools came up with some other way to pay all their little fees...

 

[PrincessSuzanne]

It was interesting that I ran across this thread today because I was just in my bank this morning on an unrelated issue. I bank with Suntrust by the way. Anyway, the customer service rep proceeded to explain I would be getting a letter in the mail soon about changes effective November 1st. He said there will be no more "Free" checking unless you have direct deposit or carry a min. avg balance of $500. O.k. no problem for me on that as I have direct deposit so I should not have any charges. He also said they will be charging $5 flat fee for debit card use. He said you can charge 1-1000 times and it will be a flat $5 per month. Not to bad IMHO. I asked him about them doing away with debit card rewards as I have sky miles and he said he has not heard of them doing away with that but it's not out of the question. So, I hope that helps someone for what it's worth. I feel a little better about the situation now, $5 a month I can handle for convenience.

Suntrust is my other bank and I sure hope they don't do this, or I will have to close my acct there, or I should say DH's acct. My check is direct deposit in my acct there and they actually paid me to open this acct, they gave me $100 for switching, but that was because we have our mortgage with them. I have one of their special accts that requires something like $5,000 minimum balance (that isn't happening), unless you have a mortgage. I don't want to pay them $5 a month for the use of a check card, we never do PIN transactions on that acct.

Absolutely -- USAA saw the writing on the wall and polled their bank customers asking which was more important to them - rewards points or free checking. IMO, that's engaging the customer, which is a good thing.

As banks charging for the privilege of using a debit card may be looming near, let me ask everyone this: What would then be the diffference between banking at a traditional bank and using a prepaid MC/Visa/AmEx card?

Something to think-about...

I love USAA and am really glad a friend encouraged me to switch to them for our Auto Insurance, we are saving a ton and a completely free checking acct and refund of transaction fees, what more can you ask for.

 

[JB2K]

Crossing my fingers that some will pass on the savings to customers, kind of like Target gives you a 5% discount for using their debit card.

Doubtful - as the only reason Target is able to do this is because Target owns the bank that backs-up their credit/debit cards (meaning no fees charged to Target stores -- hence, Target is able to pass the savings on to their customers in the form of 5% off each "swipe").

Both Walmart and The Home Depot floated the idea of doing something similar a few years ago and it met with a lot of resistance from the usual suspects (labor unions, big banks, etc.) and our elected officials caved and passed legislation that prohibited big companies from owning their own banks (though companies such as GE and Target were "grandfathered" in) -- now that the banking industry is a complete mess, I bet Washington wishes they had re-thought that one...

Furthermore, given the recent press that Target is not so "union-friendly" , they may no longer be getting any more "free passes" such as the one they got to keep their bank...

 

[Free4Life11]

I had no idea Target owned the bank, interesting. I sure do love that 5% discount!

 

[TheRatPack]

Can I ask how you do this?

I am thinking you go to a warehouse place like Costco?

Do you plan all your meals for the month and stick to the plan?

Do you still go weekly for things like fresh produce?

Dawn

Yes, I make a monthly menu on Microsoft Works....I had a rotation of 2-3 of them so you didn't have to fill it out every month, but still sometimes I print out a blank one and just fill it in with new recipes or whatever. I have all the foods the family likes to eat written down and a list of ingredients. Once I choose the meals we're going to eat for the month, I sit down and just put a mark next to each ingredient that I need and put tick marks for each cup or bag or pound that I need so I can keep track of how much cheese, chicken breast, ground beef...etc I'll need for all the recipes. I also factor in eating out once a week and buy various items for snacks. We have fresh fruit the week after the store trip, but otherwise we usually eat canned or frozen unless we stop by the farmers market. It was frustrating at first, I'd always forget one ingredient or not have enough of something...but it got easier with time and we slowly built up quite the pantry. We try to stick with the menu as closely as possible....but if we're not feeling spaghetti or hamburgers one night we'll switch it out with something else on the menu

Suntrust is my other bank and I sure hope they don't do this, or I will have to close my acct there, or I should say DH's acct.

Just got my Suntrust letter and it says that free checking will be changed to 'everyday checking' for 7.00 a month (unless you have direct deposit of 100.00 or more a month, or 500.00 minumu daily collected balance). It also says that they are going to start charging 5.00 a month for unlimited check card usage (applies when the ATM or Check card is used during the statement cycle for a signature, PIN point of sale or recurring check card transaction).

The Solid Choice Banking has a 17.00 maintenance fee per month unless you have a 5000.00 minimum daily collected balance or 10,000 in total linked deposits or a Suntrust First Mortgage with SurePay.

While $5.00 a month isn't horrendous, it is enough to make me think about using cash or writing a check. That comes out to be 60.00 a year.....that's ridiculous when it's more convenient for the stores and the banks to process card swipes over checks. I'm disappointed that they passed this on to the consumer

 

[KELLY]

Yes, I make a monthly menu on Microsoft Works....I had a rotation of 2-3 of them so you didn't have to fill it out every month, but still sometimes I print out a blank one and just fill it in with new recipes or whatever. I have all the foods the family likes to eat written down and a list of ingredients. Once I choose the meals we're going to eat for the month, I sit down and just put a mark next to each ingredient that I need and put tick marks for each cup or bag or pound that I need so I can keep track of how much cheese, chicken breast, ground beef...etc I'll need for all the recipes. I also factor in eating out once a week and buy various items for snacks. We have fresh fruit the week after the store trip, but otherwise we usually eat canned or frozen unless we stop by the farmers market. It was frustrating at first, I'd always forget one ingredient or not have enough of something...but it got easier with time and we slowly built up quite the pantry. We try to stick with the menu as closely as possible....but if we're not feeling spaghetti or hamburgers one night we'll switch it out with something else on the menu



Just got my Suntrust letter and it says that free checking will be changed to 'everyday checking' for 7.00 a month (unless you have direct deposit of 100.00 or more a month, or 500.00 minumu daily collected balance). It also says that they are going to start charging 5.00 a month for unlimited check card usage (applies when the ATM or Check card is used during the statement cycle for a signature, PIN point of sale or recurring check card transaction).

The Solid Choice Banking has a 17.00 maintenance fee per month unless you have a 5000.00 minimum daily collected balance or 10,000 in total linked deposits or a Suntrust First Mortgage with SurePay.

While $5.00 a month isn't horrendous, it is enough to make me think about using cash or writing a check. That comes out to be 60.00 a year.....that's ridiculous when it's more convenient for the stores and the banks to process card swipes over checks. I'm disappointed that they passed this on to the consumer

I don't have a credit card at all. But I do use cash and debit all the time. I think if this is the case I will just go with cash. I may be forced to apply for a credit card. Dh has 2 of them so we do use his on occasion and pay them off. But I'm not willing to pay a monthly fee to use my account either. Another problem is dh work don't offer direct deposit.

 

[LauraLea]

Not sure it will affect me at all. I've never used a debit card....ever....and have no plans to start.

Same here. Too many horror stories of incorrect transactions wiping out your balance and then bouncing or denying new transactions until it is resolved. This often takes days.

Much prefer credit cards with GOOD rewards, and paying my balance in full each month. At least if there is an incorrect transaction, you have the entire billing cycle to take care of it.

Laura

 

[PrincessSuzanne]

Just got my Suntrust letter and it says that free checking will be changed to 'everyday checking' for 7.00 a month (unless you have direct deposit of 100.00 or more a month, or 500.00 minumu daily collected balance). It also says that they are going to start charging 5.00 a month for unlimited check card usage (applies when the ATM or Check card is used during the statement cycle for a signature, PIN point of sale or recurring check card transaction).

The Solid Choice Banking has a 17.00 maintenance fee per month unless you have a 5000.00 minimum daily collected balance or 10,000 in total linked deposits or a Suntrust First Mortgage with SurePay.

While $5.00 a month isn't horrendous, it is enough to make me think about using cash or writing a check. That comes out to be 60.00 a year.....that's ridiculous when it's more convenient for the stores and the banks to process card swipes over checks. I'm disappointed that they passed this on to the consumer

Maybe I will get mine this week. If this is what they are doing, I will eliminate Dh's acct, because we hardley keep anything in there anyway, we were just using it to cash his Army Reserve check and we are trying to get that changed to his USAA Direct Deposit Acct.

Mine must be the Solid Choice Banking acct, because my mortgage is tied to it, but I will close that if I have to and move my check to USAA. There is no way I could ever even begin to have a $5000 balance. I do have my check direct deposited there though. I will not pay any kind of fee to them, I will move my acct before I do that. I'll learn to carry cash again if I have to and write more checks, those are free anyway, or ry to strictly use that acct for bill pay.