Over July and August, Bank of America will begin phasing out traditional checking account products and move a half-million customers to new accounts.
We've seen this pattern a lot over the last couple years: banks changing their account offerings, increasing fees, and making it more difficult for customers to maintain free accounts. Among other things, this is a response to financial losses from foreclosures and to new regulations that make it harder for banks to generate revenue, Boston.com reports.
The Bank of America move in July and August will affect over 530,000 customers in three states, including approximately 170,000 accounts in Massachusetts. However, just because you may not be one of the ones affected during the July and August transition, doesn't mean you're safe from the transition. By the end of the year, Bank of America plans to move all customers nationwide to their new accounts.
Some customers who were able to get free accounts though the MyAccess checking by maintaining a $1,500 account balance or by making direct deposits every month will see the requirements increase if they want to still get a free account. The new account that is replacing MyAccess is called Enhanced checking. To get a free account under Enhanced checking, you must make deposits totaling $2,000 each month, maintain at least $5,000 in combined accounts, or use a bank credit card (not a debit card) at least once a month to avoid the $15 monthly fee. Not all Bank of America credit cards qualify to get the monthly fee waived: secured cards and unsecured credit cards that are offered as a counter-offer, are not eligible for this service, according to the Bank of America website. Bank of America says that there will be more ways to avoid the monthly fees under the new account structures. Although there may be more ways, they may be more difficult ways.
According to reports, nearly half of all American households have some type of relationship with Bank of America. However, even smaller banks are implementing similar practices to try and make up for lost revenue. The Wall Street Journal reports that $5 ATM fees may be on the horizon in the near future. Chase, for example, is currently testing fees of $5 in Illinois and $4 in Texas for people who use a Chase ATM and aren’t a bank customer.
Depending on your current banking habits, the changes may not be an issue for you. If you already routinely maintain at least $5,000 in combined accounts, for example, you can keep your Bank of America free account. That’s why it’s always a good idea to regularly review your bank’s policies (and pay attention to any notices you receive in the mail), and determine how good of a fit the account is for your current habits.
Once this deal becomes final, ING Direct accounts will be converted to Capital One accounts. If you're an ING Direct customer, here's what you need to know.
Recently, Capital One announced it was acquiring ING Direct to make it the country's fifth-largest bank (measured by deposits), according to this Washington Post article. The acquisition will potentially allow Capital One to issue more loans and grow in size even more, since it is now able to enter new markets. The deal could close by the end of 2011 or in early 2012.
ING Direct is one of the pioneers of online banking, and is well-known for offering competitive interest rates while providing customers with low-to-no maintenance fees and high levels of customer service. Many loyal ING Direct customers are outraged at this acquisition, as this New York Times blog reports. So if you're an ING customer, how will it affect you?
No changes to your account will happen until the deal is finalized at the end of 2011 (or in early 2012). A Capital One representative that was interviewed for the New York Times article indicates that they “have no plans to make any significant changes. ING customers should expect the same great customer experience and the ‘status quo’ from ING for the foreseeable future.” Capital One also stresses its commitment to sustain ING Direct’s high level of customer service.
Only time will tell whether or not Capital One will be able to satisfy its newly acquired customers in the same way ING Direct did. If you're a current ING Direct customer, you may want to ride out the transition to see how it goes before determining whether or not you would be satisfied with your new Capital One account. However, brand (and bank philosophy) is of great importance to some people, and some consumers will be immediately uncomfortable with the change. If you are one of those consumers, the good news is that you have some time to research other banking options available to you and determine whether or not you want to remain in a Capital One account, or if you want to try a new bank.
It is no secret that interest rates at banks are generally low in today's economy. However, your bank may help make up for it by offering you other perks. Bank of America's Museums on Us program is a perfect example.
It can be disheartening to look at the interest rates offered by most of the banks in today's economy. However, your bank could be offering other perks that may help cheer you up, despite the generally low interest rates. Bank of America’s Museums on Us program is a perfect example.
If you take your Bank of America (or a Merrill Lynch) debit or credit card to participating museums, zoos, science centers, and botanical gardens, you can get free general admission on the first full weekend of every month. For example, that means on July 2nd and 3rd you can take your pick of participating local museums and visit it for free. The Bank of America customer must bring a photo ID and free admission is limited to the cardholder only, but it can still save you a lot of money—especially if you take full advantage of all of the museums available to you. There are approximately 150 museums nationwide that participate in this program.
As an example in the Boston area, the Boston Museum of Fine Arts normally costs $20 for a regular adult admission. The Boston MFA participates in the Bank of America program, so the cardholder would get in free. This museum also offers free admission to children under 17 on the weekends, so your entire group may be able get in free if it’s just the cardholder and children (depending on the museum’s policy). If you’re married and both you and your spouse have a Bank of America debit or credit card in your individual names, then you would both get in free.
If you happen to live in (or are visiting) New York City, you can get into places like the Bronx Zoo, the Metropolitan Museum of Art, and the New York Aquarium for free on the first full weekend of the month. The full list of free attractions is available here.
If you’re not a Bank of America customer, check with your financial institution to see if there are any hidden perks or discounts you may be able to get as a customer. It can help soften the blow of low interest rates in a bad economy.
