BANKING--ON THE INTERNET???
by Paul and Kerri Elders
As we all know, the internet is a fantastic means of communication. Email messages and photographs can be sent to any email destination, around the world, in a matter of seconds.
But did you know that you can do your banking online? With a few clicks of the mouse, you can check your account balances, transfer funds between accounts, and pay your bills, online, without ever writing another check!
Many conventional banks offer internet banking services, and there are several internet-only banks that service customer's banking needs exclusively via the internet. Branchless banks, these institutions exist only at a single location that customers can access, worldwide, via the internet. Since most internet banks are branchless, they save millions of dollars each year in administrative expenses, and can pass this savings on to their customers in the form of higher interest rates.
While conventional institutions usually charge premium rates for the "privilege" of using internet banking services, internet-only banks do not. Internet banking is their stock-and-trade, and their wide-ranging services and relatively high interest rates are extremely appealing.
Before considering moving your money to an internet-only bank, do a little homework. First and foremost, be absolutely sure that the bank you are considering is FDIC insured. You can do this by visiting the FDIC website (Click Here). FDIC insurance assures you that money deposited in this bank is safe and secure. FDIC insurance protects your deposits (up to $100,000); if the bank becomes insolvent, your money is insured. The same holds true for standard branch-based banks--it is never advisable to deposit money in a bank that is not FDIC insured.
Internet banking is extremely flexible--banking services are available to you 365 days a year (yes, weekends too), 24 hours a day. You can easily set up automatic monthly payments (your mortgage or car loan, for example) so that they are paid on time, automatically. You also have the convenience of paying your bills online by simply filling out an online form, typing in the amount of money to be paid to each company you wish to pay (phone company, electric company, gas company, etc.). It's much quicker, easier, and less expensive that traditional bill payments by check, and you don't have to pay 33 cents postage for each bill, either! And, these online banking systems integrate with your personal financial software, if you use Quicken.
But, if you still like the look and feel of a traditional check, don't worry. Internet bank accounts provide printed checks for your use, so that you can pay by internet or pay by check.
For adventurous types, there are internet banks that will allow you to link your banking and brokerage accounts, so that you can have a seamless movement of profits and loss from your brokerage (stockmarket) account and your banking account. However, keep in mind that brokerage accounts are not FDIC insured.
Internet banking is a fantastic convenience, and can help you profit more from the money you hold in your savings and checking accounts. Internet banks offer a full range of services, including Interest Bearing Checking Accounts, Money Market Accounts, Savings Accounts, Mortgage Loans, Car Loans, and Certificates of Deposit. Venture into this brave new world, and put more money in your own pocket, instead of in your banker's!
If you are interested in what internet banking can do for you, here are two well-known, FDIC-insured internet banks: E*Trade Bank and WingSpan Bank (owned by BankOne).
Paul & Kerri Elders are freelance writers who live in Ranchvale, New Mexico.
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