How this financial adviser took action to avoid paying high bank fees:
I recently returned from vacation to find two baffling letters from my bank, which I’ll call Goliath Global Bank. For reasons the bank chose not to disclose, I was informed that it was converting my savings and checking accounts in ways where I’d now be subject to steep monthly fees. Applying a little arithmetic, they tallied up to $504 in annual fees.
The interest that both accounts had been paying was paltry to say the least — between 0.01% and 0.05% annually. That translated to a few bucks a year and made parking my money at Goliath Global Bank only slightly superior to sticking it in my mattress. You don’t need to be a financial adviser, like I am, to recognize that paying $504 to make a few bucks isn’t a good deal for the consumer.
The bank said I could avoid these fees with the new accounts as long as the total of my balances never dipped below $28,500. But taking money out of my Treasury Money Market Fund yielding about 2.3% to maintain the minimum balance made even less sense. It would end up costing me about $670 a year.To receive this opportunity to pay hundreds of dollars a year, both letters assured me that all I needed to do was nothing. “one letter said.
Admittedly my own inertia had kept me at Goliath Global Bank for years. Even after the time came for my son to set up his finances for college and the bank encouraged him not to pay his credit card balance off monthly. And even though, despite my 19-year track record at Goliath Global Bank, it put long holds on checks, costing me a couple hundred dollars in lost interest that could have been earned elsewhere.
Taking Goliath Global Bank’s direction to do nothing was not an option. So, I called the 800-number listed on the letters. It got me nowhere.I walked over to my branch in search of some face-to-face interaction. The banker I met there was unaware of the letters, since they’d apparently been sent by corporate in another state. So I sent a copy over. Ispoke with the original banker I first contacted who told me to call the same 800-number that had got me nowhere.
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