I have taken the first step toward ending our long time relationship with Bank of America. There are numerous reasons for this, the latest being an account maintenance fee being imposed on one of our smaller accounts. There was no advance warning of this. It surprises me that a bank that has used so much of our money, including mortgage and investment accounts, would do this.
For a number of months I have been studying rewards checking accounts offered by some local and regional banks. These are accounts that even today are paying 3% to 4% interest on checking deposits up to $25,000. There are no minimum balance requirements and no account fees. ATM fees are refunded nationwide.
To be eligible for the highest interest rate, you must make a certain number of debit card transactions each month. A typical minimum is ten. You must also have one direct deposit or automatic bill pay each month, and access the account electronically. These are easy requirement for us to meet, as we are doing it now. Bank of America is not rewarding us for that activity. Instead, it is imposing random account fees on a long-time, high net worth customer. Foolish, to say the least.
I found a community bank offering a 3.78% interest rate on its rewards checking account. It has branches locally and where we are buying our condo. The online banking interface is first rate. I opened an account yesterday and over the next 30-60 days will be transferring all of our routine banking activity to that account. This bank was glad to have me. During the 15 minute interview with the bank officer to open the account, I also met the branch manager and loan officer. They told me that they are opening many new accounts for refugees from the large banks. Good for them.
At this stage of life, all baby boomers should be looking for ways to squeeze extra earnings out of every dollar. Finding a bank that pays a better return is part of that. We finally did it, with a rewards checking account. Keep in mind that the rate we are earning at a local brick and mortar bank is better than anything offered by the internet-only banks. The personal finance blogosphere loves talking about those banks because they get paid for referrals. I don’t.
You should research this for yourself. Start by reading this post on rewards checking accounts. But dig around locally because many of these accounts are not well advertised.