ATM fees hit a record high for the 11th year in a row, according to a recent Bankrate.com study. According to the study, the average total cost of an out-of-network ATM withdrawal is now $4.69, up 2.6 percent from $4.57 last year. In New York City the average ATM fee stands at $5.14, and in Pittsburgh it is still 5 cents higher. ATM fees have now risen over 55% over the past decade. It seems like an extraordinary burden to have placed against you for the convenience of accessing your own money.
The obvious first line of defense for avoiding ATM fees is to maintain an account with a bank or credit union that has a branch and/or ATM network that is convenient to you. You can see a map showing all banks near you here, and all nearby credit unions here. BestCashCow recommends keeping only the minimum amount in these accounts necessary to access the bank or credit union’s ATM and transactional network, and to put your remaining cash balances in the highest yielding accounts you can find so that your money works for you. Often, but not always, the highest yielding accounts will be online savings accounts, and you can find a list of the highest yielding accounts here.
The obvious second line of defense for avoiding ATM fees is to use credit cards whenever possible. Having the right card enables you to be earn reward points or cash back for your spend.
However, sometimes, it simply is impossible to find an ATM network easily when you need cash. That’s when a strategy like going into a grocery or drug store and making a small purchase on your bank’s debit card can enable you to get cash back. For those times when that strategy doesn’t work, you should also check out the Venmo app which enables you to quickly transfer cash to anyone. Finally, if you really find yourself paying out-of-network ATM fees too often, you might want to consider the tried and true strategy of carrying a checkbook.
Many investors, commentators and financial managers have perpetuated and subscribed to the fiction that those who want to protect themselves from an overvalued stock market should be moving to bonds. In fact, a recent New York Times piece, described here, even mistakenly assumed described investors’ choices as being binary – stocks versus bonds.
The idea that bonds are somehow a safe investment comes from the fact that long-term bonds have appreciated dramatically over the last several years as interest rates have come down and expectations of their rising have diminished.
With the 10-year Treasury yielding 2.10% and with the Federal Reserve guiding towards a Fed Funds rate of 3% in 2019, I would argue that the only way long-term interest rates do not rise, and rise dramatically, is if we fall into an economic depression and the yield curve becomes inverted. Also, oil and commodity prices are currently tremendously suppressed because the monarchy’s policy of opening up reserves is causing too much supply to reach markets. An impeachment trial will change this, causing commodity prices and inflationary pressure to rise, and driving 10-year Treasury rates to levels that those in their 20s and 30s have never seen.
The impact of a turn in interest rates on bond prices will be dramatic. You can ask anyone who tried to sell a long-term bond in 1970’s how many pennies on the dollar they received for it. Alternatively, you can speak to anyone who bought a long-term bond in July 2012 when the 10-year Treasury was at 1.52% how much their brokerage account valued it in August 2013 when the 10-year Treasury was at 2.90%. Bond investors can quickly lose 30% to 50% of their principal should they need liquidity during a period of rising interest rates.
My view that another dramatic move up in 10-year Treasury yields – and dramatic fall in bond prices – is likely upon us is not unique. It is shared by Leon Cooperman and Alan Greenspan.
Jamie Dimon, the Chase CEO and Tufts alumnus, blasted bitcoin today saying it is a fraud that will eventually blow up.
Bitcoin has enjoyed a tremendous run and may or may not be due for a significant pullback. It, however, is not likely a fraud and is unlikely to blow up.
In fact, bitcoin is clearly emerging as a currency free of federal regulations and central banks. Unlike Dimon, I and many others know that bitcoin is here to stay and its value will ultimately be many times higher than it is today.
A bank CEO like Dimon is entirely married to the current system and unable to see beyond his nose and to understand what is materializing in financial circles outside of his own bulwark. While many tertiary bitcoin-like currencies will prove to be worthless in time, bitcoin itself is emerging as a measure of value that the major banks will need to adopt and accept over time. It’s just plain obvious that it is a twenty first century currency soon to challenge in a big way centuries old currencies.
