Somebody explain me banking (not you, Rick)
13There is no way in hell that a savings account will lose a significant amount of money to inflation. People shouldn't be scared of their own money and they should start actively investing it and going beyond hoarding as soon as possible. You do not have to "beat the banks" to do well.
Overdraft fees seem grotesque at the bottom end of the scale because the bank doesn't care about your titchy little account, it cares about the big accounts. What would look like an understandable <0.1% service charge on an account with a lot of cash flow looks like a 200% interest profit when the same is charged on a small account. The main reason here is that finance regulations force the banks to treat all customers the same, they aren't allowed to favorable to the customers they like and unfavorable to others. So small accounts, small amounts of credit get charged the same as every other account.
Of course I'm posting this from the UK, where banks are positively utopian compared to the states. Even so, having a current account with an overdraft is an expensive business whatever the amount, because regulation forces the bank (to a certain extent) to treat all customers evenly.
Overdraft fees seem grotesque at the bottom end of the scale because the bank doesn't care about your titchy little account, it cares about the big accounts. What would look like an understandable <0.1% service charge on an account with a lot of cash flow looks like a 200% interest profit when the same is charged on a small account. The main reason here is that finance regulations force the banks to treat all customers the same, they aren't allowed to favorable to the customers they like and unfavorable to others. So small accounts, small amounts of credit get charged the same as every other account.
Of course I'm posting this from the UK, where banks are positively utopian compared to the states. Even so, having a current account with an overdraft is an expensive business whatever the amount, because regulation forces the bank (to a certain extent) to treat all customers evenly.
Somebody explain me banking (not you, Rick)
14big_dave wrote:Overdraft fees seem grotesque at the bottom end of the scale because the bank doesn't care about your titchy little account, it cares about the big accounts.
Even so, having a current account with an overdraft is an expensive business whatever the amount, because regulation forces the bank (to a certain extent) to treat all customers evenly.
Do the regulations dictate the amount of the penalties?
Somebody explain me banking (not you, Rick)
15Unfortunately not, but there are regulations (or more accurately, agreements between the banks) to stop banks charging in certain situations. Mostly in situations why the customer has little control:
You cannot be charged by the bank for using an ATM machine.
You cannot be charged for failing to withdraw money using an ATM.
You cannot be charged for using a competitor's ATM machine.
To be honest, I'm more suspicious of accounts that frequently charge a little rather than banks that have a standard "lump" penalty of 25-40ish. It is £35 with my bank, I'd prefer that to ~£10 here and there. Although it is a bitch if the direct debits go out on the wrong day.
You cannot be charged by the bank for using an ATM machine.
You cannot be charged for failing to withdraw money using an ATM.
You cannot be charged for using a competitor's ATM machine.
To be honest, I'm more suspicious of accounts that frequently charge a little rather than banks that have a standard "lump" penalty of 25-40ish. It is £35 with my bank, I'd prefer that to ~£10 here and there. Although it is a bitch if the direct debits go out on the wrong day.
Somebody explain me banking (not you, Rick)
16Ifan Saer wrote:MonsterDad wrote:Mirza?
Yes sir?
Ponor je, jebate.
Somebody explain me banking (not you, Rick)
17Very wealthy people often have large arranged over-drafts because they cannot afford loans or do not want to put their assets into car purchases, holiday, or property and like. Banks value them for obvious reasons, and while they prefer to give them loans they frequently give arranged overdrafts at very low fees. They also do the same to help valued customers out of debt, or along with a student loan/account package, or even to help with a starting business package. They do not want to lose the custom.
Hence, over draft fees, profit for the bank. Poorer customers are, in effect, subsidizing a service to benefit of richer customers, students and small business owners. Which are the customers that the bank intends the overdraft service for. If your monthly incoming is < £1000, you shouldn't even think about having an overdraft or "immediate credit" service. It isn't designed for such accounts, and if you try to use it frequently for "spot cash" the bank will rape you with a condom full of pound coins. Banks are good at influencing the behaviour of their customers, and this is their Pavlov moment. Bad dog, not for you!
If you really need spot cash for a long period of time, chat to banks and try for an interest free arrangement in exchange for a monthly subscription charge. It might feel like paying the bank protection money (pay us a little, we'll make sure that you won't have to pay us a lot), true, but it is worth it in the long run.
Hence, over draft fees, profit for the bank. Poorer customers are, in effect, subsidizing a service to benefit of richer customers, students and small business owners. Which are the customers that the bank intends the overdraft service for. If your monthly incoming is < £1000, you shouldn't even think about having an overdraft or "immediate credit" service. It isn't designed for such accounts, and if you try to use it frequently for "spot cash" the bank will rape you with a condom full of pound coins. Banks are good at influencing the behaviour of their customers, and this is their Pavlov moment. Bad dog, not for you!
If you really need spot cash for a long period of time, chat to banks and try for an interest free arrangement in exchange for a monthly subscription charge. It might feel like paying the bank protection money (pay us a little, we'll make sure that you won't have to pay us a lot), true, but it is worth it in the long run.
Somebody explain me banking (not you, Rick)
18MonsterDad wrote:Ifan Saer wrote:MonsterDad wrote:Mirza?
Yes sir?
Ponor je, jebate.
Dje si mala
This has been very informative thus far. I'm starting to think I could do quite nicely without a bank account, if I could come up with an alternative way of charging for my services.
Somebody explain me banking (not you, Rick)
20The Board's Finance Expert wrote:You are babbling out of your freaking mind bullshit. Very wealthy people cannot afford loans???????
What the FUCK are you on about??? They 'arrange' overdrafts??? They 'arrange' to write a check for more than their balance, on purpose???? Under what circumstances would they be required to do that, or would it be to their advantage to do that, you idiot?
I'm going to break my policy of ignoring Rick to post one thing:
L.O.L.
And I mean it.