A Comprehensive Guide to Modern Banking

Welcome to our guide to modern banking.  Banking has evolved tremendously since the 1990’s.  What used to be keeping your money with your local banker is now getting the best return for your savings!  Living in Clemson, South Carolina no longer dictates that you have an account with a local bank.  You can just as easily bank your money in Toledo, Ohio or First National Bank of Omaha in Omaha, Nebraska! 

We are essentially free to bank with whoever and whenever we want.  As a result, banks have launched national marketing campaigns competing fiercely for our business with very competitive rates and perks.  Some of the well-known offspring from this banking development include ING Direct, Emigrant Direct, WT Direct, and many similar institutions.  The outcome of this competition has been very good for us as the potential consumers with high yield FDIC bank accounts.

Money under the mattress trick just doesn’t work!

In addition to the usual theft, burglary, and fire risks, you are going to lose out even if the money stays there.  $100 under your mattress will worth about $77 in 5 years under a 5% inflation rate!

Are you looking for the current list of best banking offers?  These are the best High Yield FDIC Banks we can find and actively track. 

• High Yield Savings Accounts
• High Yield Checking Accounts
• High Yield Money Market Accounts
• High Yield Certificate of Deposit (CD’s)

Detour: Banks usually advertise APY (Annual Percentage Yield) on their account rates while they use APR (Annual Percentage Rate) on their loan rates.  APY includes interest compounding and APR does not.  For a more thorough account of this, read our article on APY vs. APR.

Quick Start Guides

• How to open a bank account?
  This article summarizes the requirements to open different types of bank accounts for U.S. Citizens/Residents and Foreign Residents residing in the U.S.
• The 4 essential elements of a good bank account.
  The 4 most important elements to look out for when opening a bank account.
• Should I open an account in a bank or credit union?
  Unsure where to keep your money? This article discusses the Credit Union topic.
• Understanding the difference between APY and APR.
  Banks almost always tell you the APY when you are there to make a deposit. When you want a loan, they usually disclose the APR. Read this article to learn about the differences.
• Simplify! Simplify! Simplify!
  A recipe with lots of practical tips to manage your multiple accounts.
  

The Chex System and the Credit Report System

ChexSystems provides data related to how a consumer has handled deposit accounts at banking institutions. Eighty percent of all commercial banks and credit unions in the United States use ChexSystems as a step in the consumer checking or savings account application process. What ChexSystems publishes is essentially a "black list" of individuals with bounce checks and unpaid overdrafts. Names stay on that list for about 5 years.

FICO Score: According to myFICO, a division of Fair Isaac, Inc., 90% of the largest banks in the U.S. will check your FICO score before they open your account. Many of them want to give you a mortgage or car loan down the road, so they do outright reject account applications from applicants with bad credit history. You can see your credit report and your credit score by using trial programs like myFICO, Equifax, and Privacy Matter 1-2-3

We always value your feedbacks and suggestions to improve our guides.  As a matter of fact, we love to hear from our readers!  You are the inspiration that keeps us moving foward.