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Is online banking right for you? Get the basic information
Online Banking
The common bank out there will usually have numerous branches that you can visit in person and might also provide you with the option of tending to your financial matters online. Such financial institutions provide their customers with a win/win situation. Unfortunately, most of these banks are despicable when it comes to caring about their customers.
Other banks primarily operate over the internet, rather than maintaining any physical “brick and mortar” establishments. These are the true “Online Banks” and I consider them to be a shimmer of hope in this dismal land of money grubbing financial institutions. These guys are a little more relaxed than most traditional banks usually.
As mentioned above, Online Banks don’t have to build or maintain local branches. No brick and mortar facilities translates into savings for the Online Bank and it’s customers. They sidestep having to shell out money for branch employees, maintaining ATMs, security escorts for money transfers, and yada yada yada. In return, the customers usually receive a higher interest rate and fewer fees than what they might find at their local banks.
The Cons
Since the banks are online – you won’t be able to stop in for a face-to-face resolution to any problems. You will have phone calls, emails, faxes and snail mail at your disposal but if you enjoy causing a scene and getting into some employee’s face, then this isn’t the type of bank you’ll want.
Deposits can be difficult when you use an online only bank. Since they don’t own any ATMs or branches you’ll usually have to mail in your checks. This might not be a huge problem because you use a direct deposit or you transfer money from another account – but in certain situations this can be a real headache. Some online banks even allow you to deposit money into your account by sending them a scanned image of your check and then voiding it out.
Home Banking Security
A huge concern that is always floating around out there is security. You need to understand that every bank is going to be concerned with security. So whether you’re creating an online account with your long time brick and mortar bank or you’re signing up with a new internet only banking service – they are going to protect your information. All banks use sophisticated levels of encryption to transmit your personal information over the internet. I suggest that you remove any doubts about the bank from you head for now because the biggest risk to your security is probably going to be you.
The main security concern related to online banking is most likely the fact that customers become victims of online scams and fraudulent emails. This is something that your bank cannot protect you from. In fact, these scams are at no fault to your online bank – it would actually be your fault if you ever got duped. As an example, pretend that you are a member of “A1 Bank” and you get an email that looks like it’s from “A1 Bank” claiming that there is a problem with your account or asking for your personal information. If you fall for this trick and reply to the email with your personal information – you can’t blame your online bank. You can always contact “A1 Bank” to verify if they need something from you but make sure that you use the email address, contact form, or phone number from their website – not the ones in the email. Very similar to emails that look like they are from your bank, are websites that look exactly like your bank’s website. If you aren’t paying attention, you might type in your login information and the ‘bad guys’ with use that info to login to the real website. Make sure that you type in the web address for your bank or use a trusted bookmark each time. It’s best not to click on any of the links in emails that you receive, unless you know for sure who sent you the email. You could also have some malicious software on your home computer that compromises your personal information. These types of software steal your information or record your keystrokes and send it home to the ‘bad guy’ who created the software.
If you’re really worried about security, I suggest that you educate yourself on the threats. Some basic tips that I recommend for your security are (a) investing in an internet security suite and (b) using a different password for each online account that you have. If you need help remembering all of your passwords, check out Roboform. It’s also a good idea to protect yourself from identity theft with some sort of insurance policy. I recommend LifeLock but there are other programs around like ID Watchdog
– it’s best to shop around.
What I like about Online Banking
The advantages are plentiful – convenience always creeps into my mind first. I do my budgeting and track my balances at random times and my banks are always ready when I am. Online Banks are available to you 24 hours a day, seven days a week – unless they are performing some sort of site maintenance which is usually done in the wee hours of the morning. Your account information never closes and with wireless internet available practically everywhere, you will even be able to keep track of your finances while traveling.
You should experience less of a hassle with record keeping and paperwork. With my banks I can manage my checking, savings, auto insurance, life insurance, IRAs, CDs, and so on under one secure roof. I can print documents off whenever I need to or save them electronically and back them up. Most Online Banks also allow you to export your financial information to your favorite applications such as Quicken or what have you.
Every internet bank that I’ve ever looked at will refund your ATM fees each month. Since these guys don’t operate any ATMs of their own, they understand that you’ll get charged an arm and leg when you go to another bank to withdraw some money. At the end of each statement period, most Online Banks will automatically refund your ATM fees back into your account. You won’t have to track anything or even remind the bank to pay you back – it’ll just show up. Keep in mind that they do have dollar limits of how much they’ll pay back each month so make sure you know what that limit is.
Final Ramblings
Don’t be scared of internet banking – embrace this wonderful innovation. If you found my website then I’d say you’re capable enough to operate an online banking account. Once you’ve created your account, schedule a day to sit down and play with all of the cool functions on the website. Remember that if you have any questions you can always call or email the bank and someone will provide you with support.
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Nat said:
I use BofA and get the best of both worlds. They have a killer online banking system and I can use one of their ATMs practically anywhere.
Randomly Writing said:
I would use Bank of America, if they weren’t extremely evil! =]
BofA has some of the highest fees around. I’m not just talking about their outrageous ATM fees (because they wouldn’t apply to you – as a customer) but also their fees for non-sufficient funds and overdraft transactions.
While I do agree that if I’m not going to pay attention to my balance – then I deserve to pay a stupidity tax for letting my account go below zero. However, these banks use all of our deposits on a daily basis to make themselves richer – so don’t you think they could cut us a little slack when we slip up or run into some bad luck. I see no need for fees to constantly be on the rise – $5 here and $10 there – they just do it because they can. It’s a blatant fact that banks are making some insane profits with all of their unnecessarily high priced fees and the biggest banks (like BofA) are the worst.