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April 23rd, 2010 at 06:52 am

While I have very much enjoyed my credit union and their high APYs, I am at the same time finding their 12 transactions per month requirements kind of irksome. There are some months when I run short of this quota and I feel like I have to buy something just to maintain the interest rate.

The tipping point was last month, when I didn't receive my normal interest rate because I was literally 1 transaction short! Actually, I did make a 12th transaction (with Red Box) but it wasn't soon enough to register on that month.

To add insult to injury, my CU recently pared down the interest rate some more, from 3.01% to 2.25%.

I ran some quick numbers, and if I were to go with a simple, maintenance-free savings account that had a slightly lower interest rate, I could lose as much as $50 per year in interest difference. Certainly, even $50 has been a big enough difference that I've kept up with it so far, but after the frustration of missing my interest payment last month, I think I'm ready to move on.

I just don't like the feeling of having to constantly monitor an account, and when I am short, I do not want to feel like I must find something to buy or else I'm going to lose that interest rate.

Anyways, just my yammering for the day.

6 Responses to “Streamlining”

  1. monkeymama Says:

    I don't blame you - sounds obnoxious.

  2. yiusave Says:

    I have thought about going with a higher interest rate as well, but wasn't sure if I could use that many transactions. I looked at Chase because they offered me $125. to open up an account but then you had to have direct deposit and so many transactions too. I get 1% cash back awards from my credit card and that isn't taxed. So, it does offset some of the interest that I'm not receiving. Plus the interest that you earn is taxable. My bank right now is paying 1.49% on a money market account.

  3. Joan.of.the.Arch Says:

    With two of us on an account, it is easier to make the 12 transactions per month. We concentrate on getting all the transactions done in the first couple weeks of the month if possible. Then we can relax about it till we turn the calendar page. We expect to earn around $750 in interest this year on that account. Definitely worth the trouble.

  4. nmboone Says:

    Yeah that sounds like so much work, especially if you have to mentally try to work in those 12 transactions.

  5. retire@50 Says:

    I've debated those types of accounts but was turned off by the number of debit transactions. I think I do better by buying gift cards at 5% off with my credit cards during the months I have the rebates and using them the rest of the year. Plus I just don't like the idea of having a debit card - seems riskier than a credit card to me. But I definitely understand the search for better interest rates. Makes you almost wish for inflation Smile

  6. -Jerry- Says:

    I don't think I have heard of a bank (or CU) trying to lead you to do MORE transactions! Ours allows us a certain number (or ATM transactions) for free and then charges for the withdrawals after that amount. This is a big deal because we are living overseas at the moment. We are with the same place that does our insurance, USAA, and they are pretty good like that. Good luck finding the right situation for you and your money...

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