Read and File Your Bank Statements (a cautionary tale)
In accounting there's a process of checking bank statements against your financial records every month to check for errors. I didn't do this at first and had to waste a lot of time digging for missing items later. Now I'm diligent about checking my statements every month. With my personal finances, which are less complicated, I keep up with my bank statements online, checking my account every other day if not daily. That's probably excessive, but it gives me peace of mind.
My brother, on the other hand, apparently never checks his accounts. In saving, he's my best pupil, but in regards to paperwork, he's clueless. Several months ago, he set up a money market account for his Emergency Fund. I went to show him some online banking features tonight. When checking his accounts, we saw that he had been charged a maintainence fee every month. However the interest rate he was receiving was about 15 times what I was getting.
We called the bank, and long story short, someone had set him up with a certain kind of savings account rather a money market. Apparently it had a higher minimum balance requirement. However, the bank rep. said he could avoid the fee if he set up a $10/month or more regular deposit. Since the interest rate was so much better, we decided to leave the account as it was, and set up an automatic transfer from his checking account.
Long term this mistake will probably work in my brother's favor, but because he wasn't checking his bank statements he's probably lost more in maintainence fees this year than he's gained in interest. This could have been avoided if he'd been paying closer attention. He might have grounds to get the maintainence fees reimbursed if he knew what became of the paperwork he got when he opened the account. (If he was given papers for a Money Market instead, it would show the bank had goofed). But he has no idea where they are.
Banks make mistakes. Hopefully, not often, but it's important to keep an eye on your accounts, even inactive ones.
My brother, on the other hand, apparently never checks his accounts. In saving, he's my best pupil, but in regards to paperwork, he's clueless. Several months ago, he set up a money market account for his Emergency Fund. I went to show him some online banking features tonight. When checking his accounts, we saw that he had been charged a maintainence fee every month. However the interest rate he was receiving was about 15 times what I was getting.
We called the bank, and long story short, someone had set him up with a certain kind of savings account rather a money market. Apparently it had a higher minimum balance requirement. However, the bank rep. said he could avoid the fee if he set up a $10/month or more regular deposit. Since the interest rate was so much better, we decided to leave the account as it was, and set up an automatic transfer from his checking account.
Long term this mistake will probably work in my brother's favor, but because he wasn't checking his bank statements he's probably lost more in maintainence fees this year than he's gained in interest. This could have been avoided if he'd been paying closer attention. He might have grounds to get the maintainence fees reimbursed if he knew what became of the paperwork he got when he opened the account. (If he was given papers for a Money Market instead, it would show the bank had goofed). But he has no idea where they are.
Banks make mistakes. Hopefully, not often, but it's important to keep an eye on your accounts, even inactive ones.