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Walmart's effort to get customers to build up their savings accounts

theatlantic.com

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Re: Walmart's effort to get customers to build up their savings accounts

#151

Post by cafard »

pacaro wrote: post #90
JustSomeNobody wrote: post #64

Earlier quoted context omitted.

Not really. It's very expensive to be poor (in the U.S. at least).

It grates for me when I withdraw cash. The most convenient ATM for me charges $3 when I withdraw money. My approach to this is to never pull less than $300, so the fee is 1% or less. But for people who are pulling $20 because that's what they have right now, this is a 15% tax. It's a perfect example of regressive taxation. For me it's a minor inconvenience, for most Americans it's a significant burden.

My debit card comes through a credit union. As long as I use the ATM of another credit union in the same network, I pay no fee. As it happens, there is such an ATM on the side of the building where I work, and for that matter I think there was one about half a mile from my late mother-in-law's house a hundred miles from here. I do resent paying $3 to Bank of America because I forgot to withdraw money before I left for work.

Re: Walmart's effort to get customers to build up their savings accounts

#152

Post by Kluny »

"...after a $4 check she wrote to buy coffee for herself and a friend tipped her checking account below the required minimum..."

How are people using checks to pay for coffee? I haven't been able to use a personal check for anything other than rent during my entire adult life.

Re: Walmart's effort to get customers to build up their savings accounts

#153

Post by watwut »

chrisseaton wrote: post #144
nightcracker wrote: post #142

Earlier quoted context omitted.

Those are the costs associated with running a bank. It's paid for by giving them access to our capital, that they can use to invest. Have we forgotten what a bank is for? It's to conveniently and safely store money. Part of that convenience is to withdraw and store money at many locations. If a bank didn't offer that they wouldn't get my money.

> It's paid for by giving them access to our capital, that they can use to invest. What capital? The people referred to in this article don't have any savings. Many working class people have no savings at all, and only a few thousand in their current accounts.

Which does not make this offer reasonable, it is still ripoff. They are better off keeping money in box at home.

Criticising this offer is as valid as criticising any other expensive and bad service.

Re: Walmart's effort to get customers to build up their savings accounts

#154

Post by alkonaut »

chrisseaton wrote: post #144
nightcracker wrote: post #142

Earlier quoted context omitted.

Those are the costs associated with running a bank. It's paid for by giving them access to our capital, that they can use to invest. Have we forgotten what a bank is for? It's to conveniently and safely store money. Part of that convenience is to withdraw and store money at many locations. If a bank didn't offer that they wouldn't get my money.

> It's paid for by giving them access to our capital, that they can use to invest. What capital? The people referred to in this article don't have any savings. Many working class people have no savings at all, and only a few thousand in their current accounts.

A person being a customer of a bank means the bank has first access to that persons business when they need mortgages, other loans, home insurance, buying funds for retirement savings etc.

I suppse where bank accounts are free including services like ATM that might be an indication that banks compete for all customers - which might ni turn be an indication that all customers are reasonably likely to buy financial products such as taking loans or savings products in the future.

Re: Walmart's effort to get customers to build up their savings accounts

#155

Post by alkonaut »

briandear wrote: post #138
flukus wrote: post #113

Earlier quoted context omitted.

I was wondering the same thing. From the comments it seems as though the US banking system seems to be stuck in the 80's. I can't believe they still have checking accounts, in my mid 30's now and I've cashed one check in my life.

Come to France. People use checks all the time. You still have to visit your "personal banker" to accomplish many tasks. If US banking is in the 80s, then French banking is in the 60s. And "checking account" doesn't mean "with this account I write a lot of checks." In the US there are general two types of accounts, checking and savings. I haven't written a check on my US account in over 15 years.. Though in France I…

> "checking" account is just a terminology

It's what you might call a "salary account" in other places then. It's where your pay(check - haha) ends up, and what you use for regular day to day transactions such as paying bills.

I also get confused when abroad and there are buttons to withdraw from "checking" "savings" etc. I have a handful of accounts that I name myself so it's always hard to know.

Re: Walmart's effort to get customers to build up their savings accounts

#156

Post by falsedan »

thinkling wrote: post #112
batiudrami wrote: post #79

Earlier quoted context omitted.

>It is $5/mo for accounts with less than $1000, but you're not going to get better than that at a bank. What? It costs money to lend your money to the bank in the US?

Not just in the US. I encountered fees in several countries in Europe (definitely NL).

Australian ATM fees are ridiculous, $0.50 for in-network and $2 for out (at CBA). On top of 0% interest too.

Re: Walmart's effort to get customers to build up their savings accounts

#157

Post by Symbiote »

theklub wrote: post #148
orf wrote: post #140

Earlier quoted context omitted.

As someone from the UK I always find it astounding that Americans are used to paying money to.. withdraw or deposit their money. How did this become the norm? I find it a bit disgusting actually. The only cash machines that charge over here that I've seen are rented ones at packed events (clubs, concerts etc).

I don't think it is the norm. Only time I've paid fees is at the ATM.

ATM fees are unusual in the UK, as the parent post said, though we use the term "cash machine".

Using a cash machine is free, for the majority of cases — those in banks, supermarkets, shopping centres, railway stations and so on are run by one of the banks and are free for customers of all banks to use. It doesn't matter if the machine or customer is with/is a major bank or a small one, they're all on the same network and charge the same: £0.

The exception is captive markets. Cash machines within a stadium, nightclub or a convenience store often charge. I've never used one of these, it's so easy to avoid doing so.

Re: Walmart's effort to get customers to build up their savings accounts

#158

Post by beejiu »

theklub wrote: post #148
orf wrote: post #140

Earlier quoted context omitted.

As someone from the UK I always find it astounding that Americans are used to paying money to.. withdraw or deposit their money. How did this become the norm? I find it a bit disgusting actually. The only cash machines that charge over here that I've seen are rented ones at packed events (clubs, concerts etc).

I don't think it is the norm. Only time I've paid fees is at the ATM.

In the UK, the vast majority of ATMs are free.

Re: Walmart's effort to get customers to build up their savings accounts

#159

Post by stult »

orf wrote: post #143
chrisseaton wrote: post #141

Earlier quoted context omitted.

> I find it a bit disgusting actually But withdrawing and depositing money is a service that costs the banks money to do doesn't it? I'm can see why you don't like but I can't see it as morally 'disgusting'. Would you look after someone else's meagre current account for them, and give it back on demand, for free? I wouldn't. I don't really know who covers that cost in the UK. It's certainly not interest they earn len…

> But withdrawing and depositing money is a service that costs the banks money to do doesn't it? It's literally their job. It's their function. Why am I reimbursing them? I'm giving them my money essentially to invest, why am I also paying them to support basic business functions on my money , with my money , while they make money using my money ? It's easy to say "hurr durr why are you paying them for a service they…

Historically, retail banks made their money off of the spread between their loan interest rate and the rate they pay out on deposits. So they borrow from your deposits at 2% and loan it out at 5%, pocketing the 3% difference. Over the past 20 or 30 years, extremely low interest rates and competition with money market funds and other more complex savings vehicles have reduced depository interest to essentially nothing, which sets a ceiling for the spread. So for a bank to make money off a regular joe who doesn't have enough money to access investment banking services, they need to charge fees to make a profit. For example, if you have an average $1000 in your account, the bank may only make $10 off of that in a year. Many lower end clients, the ones who tend to pay high fees for overdrafts, have even less money than that deposited on average. Also it's worth pointing out that most banks charge withdrawal fees only if you use another bank's ATM. It's entirely possible to have a checking or savings account at a bank and never pay significant fees if you don't overdraft or drop below minimum amounts. Of course, those issues tend to affect poorer customers disproportionately, but it's not without reason even if it is problematic socially.

Re: Walmart's effort to get customers to build up their savings accounts

#160

Post by Fifer82 »

chrisseaton wrote: post #146
orf wrote: post #143

Earlier quoted context omitted.

> But withdrawing and depositing money is a service that costs the banks money to do doesn't it? It's literally their job. It's their function. Why am I reimbursing them? I'm giving them my money essentially to invest, why am I also paying them to support basic business functions on my money , with my money , while they make money using my money ? It's easy to say "hurr durr why are you paying them for a service they…

> I'm giving them my money essentially to invest But what about those people who aren't giving the bank any meaningful capital to invest? What is the bank getting in return in that case? Or are you arguing that banks should be forced to provide it as a kind of social service even if they don't earn anything? I can understand that kind of point of view.

When banking becomes optional, I agree, however I need a bank and I ain't paying to take money out of it. When banking is optional, by all means they may charge, but I will take my cash in £20 pound notes in Royal Mail Special Delivery at the end of the month cheers!
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