Busting Bank Myths.

(Disclaimer, all opinions and thoughts in this blog are of my own and expressed by no company, no advice or ideas should be used as advice, legal or otherwise)   

Today I am going to go over a few myths that many people believe are true about banks, but are not. The reason why this is important is;

Having bad or untrue information can cause you to overdraft or have other problems.

So lets dive right in:

   "Cash is available immediately, so, if I put it in before midnight; I won't get an overdraft fee."

   

       This one is partially true and partially false. Cash is always usable and in your account right away, but banks have different cut off times and different processing times. So, even if you put the money in before the next day, you may still receive fees depending on what time you put it in. The best way to avoid this is talk to your local banker, and ask for their cut off times in the store and at ATMs. (As they may vary). It is also good to note that checks follow the same principle, just because you put a check in, it does not mean it will cover something already coming through.

   "I am only overdrawn a dollar, the bank will not charge me a fee for that."

       This one is again is partially true. Many banks have some sort of threshold where they will not charge you if it is under a certain amount. However, depending on what options are on your account (and the circumstances), you may still get a fee for going even one dollar overdrawn.

   "If I deposit a check, even if I had no money in my account, I can use those funds right away."

       Depending on what options you have on your account, and your banks rules, this one may be true. But it is usually false. Most checks take a day or two to clear, depending on when you deposit it and when your bank processes. What this means is if you had a 0$ balance and

add a check to the account, those funds might not be cleared until the next day. So, if you try to make a purchase right away, it may still be declined.

   "I don't overdraft often, so the bank will waive one of my fees"

       This one is very false. Let me explain why. Think of a store you go to often, and have shopped there for years. Have they ever given you anything for free? No, because they are a business and need to make money. Banks are the exact same, they don't waive fees just because you have been with them for a long time. If you go to McDonald's every day, for five years, they won't give you anything for free, why would any other business be different? As a note here, some financial institutions do waive fees on occasion, so it never hurts to ask; My point here is that don't get upset when they say they do not.

   "I did not know about that fee, and was not informed of it, therefore you cannot charge me it"

       There are certain things that are not often discussed, but are in the paperwork that you signed when you agreed to your account.One of these things is a government regulation. This government regulation states you can only make a certain amount of electronic transfers from

your savings account before you incur penalties or fees. Usually, unless you directly ask about it, this fee is not brought up. This is because many people are not affected by it. But when you are, even if you were not told about the fee, you are still responsible for it for two reasons.

1) You did not fully read the paperwork before you signed it, you agreed to something without fully reading it. The bank will not take responsibility for it.

2) just because you did not know, does not mean you cannot be charged for it. Here is an example: You are speeding and an officer gives you a ticket...If you tell him you did not know the speed limit, will he still give you a ticket? yes. Because you still violated a rule, regardless of whether you were aware of it or not.

   "With direct deposit, my money is available right at midnight!"

      Again, this may be true or false. Many banks have a wide range of processing times that usually do not end at midnight. You will have to talk to your local banker to see if this is actually true.

Well, that does it, a few myths that can cause you problems are busted. Feel free to shoot me an email or post a question below, and I will answer is as soon as I can. Also, if you want a certain topic covered, feel free to post it below and I will get to it as well.