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Apache is functioning normally

May 30, 2023 by Brett Tams

Compared to banks, credit unions offer more individualized service. Plus, many of them also provide lower fees and higher rates on certain accounts. However, you must become a member of a credit union to utilize its services. In most cases, credit union membership is reserved for people who live, work, and worship in a certain area.

Some credit unions are also geared toward those in specific professions, like education or law or anyone who makes a donation or joins an organization. You’ll be pleased to learn that most credit unions have made their membership criteria more lenient and opened up their offerings to more types of people. In fact, many of them are quite easy to join.

14 Best Nationwide Credit Unions

While many credit unions are small and can only be found in select local areas, there are quite a few that are nationwide. If you travel frequently for work or pleasure, you might be in the market for nationwide credit unions.

Fortunately, most credit unions that have a nationwide presence are easy to join and offer a variety of benefits. To make your search for the best federal credit unions a bit easier, we’ve compiled this handy list.

1. Connexus Credit Union

Headquartered in Wisconsin, Connexus Credit Union is known as one of the largest credit unions in the U.S. It has over 400,000 credit union members across all 50 states. This is no surprise as it partners with well-known companies, such as Liberty Mutual Insurance, Kraft, Honeywell, and BMW.

To join, you’ll need to qualify through your employer that’s one of the credit union’s partner companies or donate at least $5 and open an account. As a credit union member, you can enjoy high APYs on checking accounts and other deposit accounts as well as low rates on mortgages, personal loans, and car loans.

The Xtraordinary Checking Account offers an APY of up to 1.75% on certain balances so you can make the most out of your hard earned money. White you don’t have to pay any fees, Connexus does require that you spend a certain amount on your debit card and sign up for eStatements to take advantage of the interest.

Furthermore, if you don’t use your checking account for more than 90 days and have a balance of $100 or less, you may have to pay an inactivity fee. Connexus has more than 5,600 shared branches and over 67,000 fee-free ATMs. Plus, the credit union offers higher rates and exclusive discounts throughout the year.

2. Navy Federal Credit Union

If you’re part of the military community, Navy Federal Credit Union should be on your radar. You can become a member if you have an active duty or reservist military member, worked for the Department of Defense, or are the immediate family member of someone eligible for membership. You’ll also be required to open a Navy Federal savings account and make a minimum deposit of $5.

The credit union has about 350 physical branches worldwide and many of them are near military bases in Maryland, Virginia, and California. There are also more than 30,000 fee-free ATMs. If you like to do your banking on your mobile device, you’ll be pleased to know that there is a highly rated app.

If you join Navy Federal Credit Union, you can enjoy no monthly fees or minimal fees on basic savings or youth savings accounts. NFCU also offers several checking accounts as well as competitive rates for share certificates, which are basically certificates of deposits (CDs).

3. Consumers Credit Union

Based in Illinois, Consumers Credit Union has 11 branches in the Chicago suburbs but opens its membership to anyone in the country. All members get access to more than 5,000 shared credit union branches and over 30,000 ATMs.

To join, simply pay $5 and fill out a short application form. Consumers offers some of the highest annual percentage yields or APYs on its rewards checking accounts. However, it requires that you make at least 12 debit card purchases per month, enroll in eDocuments, and have a monthly minimum of $500 in ACH deposits, direct deposits, and mobile check deposits.

If you prefer, you can choose from a no-frills checking account that doesn’t earn any interest. Other product offerings include four savings accounts, IRA certificates, and money market accounts.

4. Pentagon Federal Credit Union

Founded in 1935, PenFed Credit Union is known as one of the largest credit unions in the country. It serves more than 2.8 million members and has over $36.6 billion in assets. While this best credit union was originally only available to military members and their families, it eventually opened the doors to anyone. You can join as long as you deposit $5 into a savings account.

As a PenFed member, you can reap numerous benefits, including great rates on checking accounts, savings accounts, and money market certificates. In addition, you can sign up for early direct deposit and access more than 85,000 fee – free ATMs across the nation.

Even though PenFed is not part of a shared branch network, like other credit unions, it pays high rates, and has about 40 of its own branches throughout the U.S. There’s also a solid mobile app and customer phone support with evening and weekend hours.

5. SkyOne Federal Credit Union

SkyOne Federal Credit Union is one of the best credit unions and has a mission to help families become financially stable. It serves more than 40,000 members with $600 million in assets. Since its inception in 1949, SkyOne has offered a robust lineup of financial products, like interest-bearing checking accounts, money market accounts, credit cards, mortgages, and car loans.

Its share certificates come with exceptional rates that you might not find at other credit unions. SkyOne also has a free mobile banking app, a plethora of free educational tools, and a network of thousands of credit union branches for easy access.

The main downfall of this credit union is that it’s geared toward those who work in the air transportation industry so you might have a difficult time qualifying. Fortunately, membership has recently become a bit more lenient to accommodate more people.

6. Alliant Credit Union

Illinois-based Alliant Credit Union has more than 700,000 members across the country. Unlike other credit unions on this list, Alliant operates strictly online. If you like the idea of online and mobile banking, this credit union should definitely be on your radar. Its online accounts pay highly competitive interest rates that can be as much as 22X the national average.

Plus, you don’t have to worry about overdraft or ATM fees. You can also score up to $200 per month in ATM rebates. While its checking and savings accounts are the most popular products, Alliant also provides mortgages, auto loans, personal loans, and credit cards. At this time, Alliant does not offer any no-penalty or specialty CDs.

Customer service is available 24/7 and there’s also an online contact form you can use for less pressing questions or concerns. To become a member, join Foster Care to Success (FC2S). Once you do, Alliant will pay the $5 membership fee to the organization for you.

7. First Tech Federal Credit Union

First Tech Federal Credit Union made its debut in 1952 when it was first founded by employees of Hewlett-Packard and Tektronix. Today, the credit union partners with large companies, like Hewlett-Packard, Amazon, Microsoft, and Nike. You can join as long as you work at one of its partner firms or become a member of the Computer History Museum or Financial Fitness Association.

There are 33 branches, mainly in California, Washington and Oregon, but with several locations across Colorado, Georgia, Idaho, Massachusetts and Texas. As a member, you can enjoy in-person service at more than 5,600 Co-op Shared Branch locations in the U.S.and access your money at over 30,000 free ATMs.

It offers a long list of financial products, like checking accounts, savings accounts, credit cards, loans and investment accounts. Most of these offerings come with low minimum opening balance requirements and no monthly maintenance fees. First Tech Federal Credit Union is unique in that there are many business banking services that are rarely seen at other credit unions.

9. Bethpage Credit Union

While it is located in New York, Bethpage Credit Union opens its membership to anyone who makes a $5 payment, regardless of where they live. The credit union partners with hundreds of other credit unions to offer access to more than 5,000 branches and over 30,000 fee free ATMs. Virtual visits by phone and video appointment are also available.

Bethpage’s product lineup includes three checking accounts, four savings accounts, share certificates, and money market accounts. Believe it or not, even the free checking accounts pay interest. In addition to deposit accounts, the credit union provides mortgages, home equity lines of credit (HELOCs), car loans, auto refinancing, personal loans, retirement planning, health savings accounts, IRAs, and insurance.

You can access your accounts on the go with the handy mobile app, which includes convenient features, such as budgeting tools, online bill pay, and budgeting tools. Bethpage also offers access to a digital wallet and Zelle money transfers.

10. Latino Community Credit Union

Headquartered in North Carolina, Latino Community Credit Union has 15 branches in the state as well as 1,300 free ATMs through the CashPoints network. While it was originally built for the Latino community, you don’t have to be Hispanic or live in North Carolina to join. All you have to do is submit an application and pay a $10 membership fee.

Latino Community Credit Union is federally insured by the National Credit Union Administration (NCUA) and offers 24/7 customer service via phone. Compared to brick-and-mortar banks, it provides competitive interest rates and accounts with low minimum opening balance requirements.

If you’re part of the Hispanic community, you may also benefit from services in both Spanish and English as well as a financial literacy education program that’s focused on low-income Latino families and immigrants.

11. Boeing Employees’ Credit Union

If you’re a Boeing employee or live or work in Washington, Boeing Employees’ Credit Union can be a good fit. Just keep in mind that you’ll be required to open the Member Advantage Savings account, Member Share Savings account or Early Saver account.

You can enjoy nationwide access to more than 30,000 free ATMs, discounts on local events, such as sporting games and fairs and impressive rates on CDs, money markets and IRAs. Plus, there are no monthly service fees or minimum balance requirements.

Other noteworthy perks include free credit score monitoring, Zelle payments, online bill pay, and budgeting tools. You can find more than 50 physical branches in Washington as well as one location in North Charleston, South Carolina, for in-person banking.

12. Blue Federal Credit Union

Blue Federal Credit Union began as Warren Federal Credit Union and has been in business for more than 70 years. It offers more products than most credit unions, including checking accounts, savings accounts, credit cards, home loans, personal loans, and investment banking. This is great news if you’d like the diverse offerings that are widely seen at banks at lower price points.

In addition to a vast selection of financial products, Blue Federal Credit Union provides rates as high as 2x to 5x higher than the national average and access to thousands of partner credit unions across the nation. Thanks to the tiered membership rewards program, you can earn great rewards.

To join, donate to the Blue Foundation and open a Blue FCU Membership Share Savings account. Once you’re a member, you can bank online, visit branches in Colorado or Wyoming, or go to shared branches across the U.S.

13. Wings Financial Credit Union

Wings Financial Credit Union is worth exploring, even if you don’t work in the aviation industry. It has more than 26 branches in Minnesota, Michigan, Florida, Georgia, and Washington. Not only is it NCUA insured, it’s part of the Allpoint, CO-Op, and MoneyPass ATM networks that offer access to more than 80,000 free ATMs.

To become a member, you should live in work in an eligible location, work in the aviation industry, or make a $5 donation to Wings Financial Foundation, a non-profit organization that offers financial education programs and college scholarships.

The credit union pays high interest rates on many of its accounts and doesn’t charge monthly service fees. Depending on your goals, you can open the Wings Financial High-Yield Savings Account, Wings Financial Credit Union High-Yield Checking Account, Wings Financial Investment Money Market Account.

14. NASA Federal Credit Union

NASA Federal Credit Union dates back to 1949 when it first launched to serve NASA employees. Over time, the credit union has expanded and has more than 140,000 members to date. You can join even if you’re not affiliated with NASA as long as you become a member of the National Space Society.

Popular product offerings at NASA Federal Credit Union include the Premier Checking, Premier eChecking, Premier Preferred Checking, Shared and Special Savings account or Education Savings Account.

We can’t forget the Star Trek credit cards which offer 2x points for gas station purchases, and 3x points for purchases at StarTrek.com. Furthermore, if you spend $3,000 in the first 90 days, you get a bonus of 30,000 points. You may redeem your points for merchandise, gift cards, and more.

Credit Unions vs. Banks

If you’re used to banks or unfamiliar with credit unions, you might wonder how credit unions and banks compare. The truth is both types of financial institutions offers similar products, but there are several differences between them, including:

Financial Products

In general, banks offer more financial products and services than credit unions, especially large banks with a national presence. Credit unions primarily focus on checking accounts, savings accounts, and credit accounts. While loans and investment products are less common, they can still be found at some credit unions.

Rates and Fees

Banks tend to charge higher rates and fees than credit unions. However, online banks are usually more affordable and comparable to credit unions as they have lower overhead costs. It’s a good idea to shop around so you can compare rates and fees at a variety of financial institutions and hone in on the best option.

Technology

Credit unions typically are less technologically advanced than banks. The good news is more and more credit unions, especially those with a nationwide presence, are improving their technical offerings. Many of them offer mobile apps, online bill pay, and other advanced banking tools that were unheard of in the past.

Bottom Line

With this list of the best credit unions nationwide, you’re sure to find a credit union or two that checks all your boxes. Whether you’re new to credit unions or have used them for a while, these types of financial institutions can help you meet (or even exceed) your personal finance goals.

Credit Union FAQs

What is the difference between a bank and a credit union?

While a credit union is a member-owned, non-profit institution, a bank is a for-profit financial institution that is owned by shareholders or individuals. Credit unions are known for more personal service and flexibility. Whether you use a bank or credit union depends on your unique goals and priorities.

Do I have to join a credit union?

All credit unions may have certain membership requirements. Fortunately, many are lenient and let you join if you make a donation or pay a fee. Some credit unions will pay for you once you make a deposit into an account. Of course, some credit unions limit membership to people in certain geographical locations or professions.

Do credit unions have ATMs?

Yes! In many cases, credit unions partner with a large network of ATMs. This makes it easy for you to access your money regardless of where you are.

Are credit unions insured?

Reputable credit unions are insured by the National Credit Union Administration or NCUA, which is similar to the Federal Deposit Insurance Corporation or Federal Deposit Insurance Corp of traditional banks. This means if the credit union fails because of bankruptcy, for example, you’ll get your money back.

Are credit unions online?

While credit unions have a reputation for in-person branches with individualized service, online credit unions do exist. Several examples include Alliant Credit Union, Connexus Credit Union, and Quorum Federal Credit Union. If you like the idea of online banking, an online credit union might make sense.

What is the best nationwide credit union?

Not all nationwide credit unions are created equal. In fact, there are many options available with various pros and cons. To pinpoint the ideal online or local credit union for you, explore the institutions on this list and consider your priorities. Remember, you can join multiple credit unions if you’d like.

Source: crediful.com

Apache is functioning normally

May 29, 2023 by Brett Tams

Tax law is complicated. There’s no doubt about it. But oddly enough, a lot of the tax mistakes people make are for shockingly simple things that could easily be avoided. (Some examples include missing the tax deadline, failing to report all your income, and not taking the right tax breaks, just to name a few).

Understanding these mistakes can help you avoid them in the future, since none of us really want to deal with the IRS more than we have to.

What’s Ahead:

1. Not paying required estimated taxes

If you’re a freelancer, small business owner, side hustler, or anyone else earning income where taxes aren’t withheld, you’re required to make quarterly estimated tax payments to the Internal Revenue Service (IRS).

Not paying required estimated taxes or paying them late has two major outcomes:

Your tax bill will be a lot larger than anticipated.
You’ll pay penalties and interest charges on your unpaid tax liability.

Either way you dice it, it’s not good. Work those quarterly payments into your schedule so you can breeze into tax season knowing you won’t be in trouble with Uncle Sam.

Read more: 7 Side Hustle Accounting Mistakes To Avoid

Who has to pay quarterly estimated taxes?

Generally speaking, if you owe $1,000 or more in federal taxes for the year, then you’ll need to pay quarterly estimated tax payments. This could include any income earned through:

Self-employment
Interest
Dividends
Alimony
Capital gains
Prizes and awards

Read more: Quarterly Estimated Tax Payments: Who Needs to Pay Them, When, and Why

2. Failing to keep necessary tax records

No matter how simple or complex your tax situation is, you’re going to need to collect receipts, income statements, and other things throughout the year to make sure you have everything you need to file your return.

So, what documents do tax preparers need to keep? In general, you should hang onto:

Income statements such as W2s and 1099s.
Bank statements.
Any tax forms you receive electronically or by snail mail.
Receipts for purchases and charitable donations you plan on writing off.
Copies of your signed return and all supporting documents, so you have proof if you’re audited or need to file an amended return.

If this sounds like a lot, don’t panic. You can use our tax document checklist to keep it all organized.

3. Failing to report all of your income

The IRS knows how much money you make each year — and they also know when you fail to report it all. (They’re kind of like that parent who knows their kid broke their favorite vase but they ask them about it anyway just to give them a chance to come clean and tell the truth).

If you accidentally or purposefully leave something off your return, the IRS will know about it, and there will be consequences to pay. It could be as simple as paying a penalty fee or as extreme as being audited or facing tax fraud charges. Either way, it’s best to avoid it all together.

The easiest way to make sure you’re reporting all your income for the year is to hang onto all your W2s and 1099s. This will help you make sure nothing falls through the cracks when you sit down to prepare your return.

MU30 Tip: If you file your taxes and later realize you forgot to report something, file an amended return as soon as you can to fix it. Learn how in our piece – Tax Return Error? Here’s How To Amend Your Return.

4. Not using accounts that have tax advantages

One of the easiest ways to lower your tax bill is by maxing out any tax-advantaged accounts you have at your disposal. This includes:

Employer-sponsored retirement accounts, such as a 401(k), 403(b), 457 plan, or a federal Thrift Savings Plan (TSP).
Traditional IRAs.
Health savings accounts (HSAs), which you qualify for if you have a high deductible healthcare plan (HDHP).

So, why should use tax-advantaged accounts to lower your taxes? Here’s a scenario to show you why. (It involves some math, so put your nerdy glasses on with me for a second).

A real-life example of why you should use tax-advantaged accounts

Meet Cleo. She’s a single, 28-year-old financial analyst who made $80,000 in 2022. Cleo’s big into saving, so she maxed out her company’s 401(k) ($20,500), her traditional IRA ($6,000), and her HSA ($3,650). This brings her taxable income down to $50,900.

Based on current marginal tax rates, her federal tax liability comes out to $3,650 for the year. Without the tax-advantaged accounts, Cleo would’ve been on the hook for $10,368 — A LOT more money.

Note that this is a simplified scenario that uses the standard deduction but doesn’t take into account other credits or expenses.

5. Filing with incorrect information

Another common tax mistake is filing a return that’s incomplete or inaccurate. This can result in delays in getting your refund, as well as additional penalties and interest charges from the IRS.

To avoid this, be sure to:

Double-check your bank account and routing numbers if you’re getting a tax refund via direct deposit.
Review your name, Social Security number, address, and other personal information.
Make sure your filing status is correct.
Confirm that your income matches the W2s and other income statements you have on hand.
Review your deductions and credits to see if they make sense for your situation.

6. Filing under the wrong status

Your filing status can have a huge impact on how much you owe in taxes for the year. It can also determine if you even need to file a return in the first place.

So, what happens if you file under the wrong tax status?

The most common downside is that it could result in a larger tax bill than necessary. And if the IRS suspects you were intentionally deceptive, you could be audited or hit with a tax fraud penalty.

What are your tax status filing options?

Tax filers have five filing statuses to choose from:

Single – Applies to anyone who isn’t married, including those who are divorced or legally separated.
Married filing jointly – Applies to anyone who’s married and wants to file taxes together.
Married filing separately – Applies to married couples who want to file taxes separately. This could be advantageous if you only want to be responsible for your own taxes. Or, if filing under this status will save you more money.
Head of household – Mostly for those who are single, but it can also be used if you pay for more than 50% of the costs for you and a qualifying person.
Qualifying widow(er) with dependent child – For anyone whose spouse has recently died and has at least one child dependent. Special rules apply, though.

If you’re stuck between two filing statuses, the IRS recommends preparing your return both ways to see which saves you the most money.

Read more: How To Know When You Should File Your Taxes Jointly or Separately

7. Not taking the right tax breaks

There are HUNDREDS of tax deductions and credits out there. Some are quite common — like the earned income tax credit, child tax credit, and property tax deduction.

Others are super obscure — like how you can write off student loan interest paid by your parents. Or, how you can write off taxes paid to the Social Security Administration if you’re self-employed.

Read more: Tax Benefits For College Students: How To Pay Less And Get More Back

One of the best ways to reduce your taxes is to take advantage of every tax break you qualify for. The good news is, if you file your taxes online, the tax software you use will automatically maximize these deductions and credits for you.

Check out a few of our recommended tax software options here: Best Tax Software Compared

8. Missing the tax deadline

The tax filing deadline is April 15 (almost) every year (or October 15 if you file an extension). But in 2023, it’s April 18 due to a state holiday. One of the most common tax mistakes people make is missing this deadline.

So, what happens if you miss a tax deadline?

If you’re set to receive a refund: the short answer is nothing. You can file your tax return at any time and get your money. You won’t pay any penalties or fees.
If you owe the IRS money: you’ll pay a penalty for filing a late return and for not paying your taxes on time. This penalty gets larger the longer you wait, so file your return ASAP if you can.

The IRS’ Failure to File Penalty is 5% each month for any unpaid taxes owed. This fee maxes out after five months for a total of 25%. There’s also a Failure to Pay Penalty that keeps accruing each month even after the Failure To File Penalty stops. It can all add up in a hurry.

MU30 Tip: A tax extension gives you more time to file your return, but it does not give you more time to pay any taxes you owe. So, if you have a bill this tax year, set up a payment plan by the deadline even if you haven’t filed a return yet.

9. Filing your tax return too early

If you’re anything like me, you may be in a hurry to file your taxes as soon as possible each year. Especially if you’re set to get a refund.

Side story: I remember so many times in college when I treated the first day of tax season like my birthday or Christmas. I’d wake up and file my return as quickly as I could because I was so excited to see what my return would be. Weird, I know.

But here’s the catch — another easy tax mistake people make is filing their return too soon. Sounds odd, right?

When you file your return too soon, you run the risk of not having all the proper tax documents you need to file a complete and accurate return. You could also miss out on valuable deductions and credits and that could maximize your refund even more.

What you should do if you make a mistake on your tax return

Okay, so what happens if you file your return and then realize, “Crap! I’ve made a mistake!”? Calm down and take a deep breath. We’re gonna get through this.

In most cases, all you need to do is file Form 1040X, which is an amended tax return, to correct any mistakes you made.

You can typically amend your return using the same tax software or company you used to file it the first time. Or, you can download this form from the IRS and fill it out by hand (although this is a lot more tedious).

Summary

These are just a few of the most common tax mistakes people make each year. The IRS doesn’t always make things easy for us, so there are some things that are just honest mistakes.

One easy way to minimize these mistakes is to file electronically using tax software or a tax professional.

Apache is functioning normally

May 27, 2023 by Brett Tams

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Updated Mar 09, 2023

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MetLife could be a good choice for various life, health or other medical insurance policies. However, its options are only sold as employer-provided group insurance plans. Additionally, MetLife no longer sells auto or home insurance policies; those products are now provided by Farmers Insurance.

Extra benefits, including financial planning and grief counseling, are available
Numerous other types of medical coverage available

Info

What’s new with MetLife?

In April 2021, Farmers Insurance finalized the acquisition of MetLife’s home and auto insurance divisions. Going forward, MetLife Insurance will focus on life, health and pet insurance, as well as financial products like Health Savings Accounts (HSAs) and employer-sponsored retirement plans.

MetLife life insurance

MetLife life insurance could be a good choice if the company provides your employer’s group life or health offerings. MetLife got its start in 1863 and has grown tremendously in the time since. Although Farmers Insurance purchased MetLife’s auto and home business, Metropolitan Life Insurance Company continues to operate independently. The company provides life insurance through employer-sponsored plans and groups.

However, the life insurance coverage types are relatively limited. Additionally, MetLife uses numerous underwriting companies, so your coverage may not actually come directly from MetLife. Our MetLife life insurance review breaks down the company’s offerings, to help you choose the right type of life insurance for your needs:

Term: MetLife offers basic, supplemental and dependent term life coverage. Some types of coverage are employer-paid, while others are paid by the employee. Term life insurance may be especially popular with young families or for those who only need coverage for a short period of time, usually 10, 20 or 30 years.
Permanent: MetLife offers two types of permanent life insurance coverage: group universal and group variable universal life. There is no whole life insurance. Permanent policies may be a better choice for older adults who need the coverage to last the rest of their lifetimes.

Group universal: Universal life insurance offers flexible options, allowing you to adjust your death benefit and premium as your needs change. MetLife’s universal life insurance offering is only available as a group plan.
Group variable universal: Variable universal life is similar to a standard universal life policy, but it includes an investment component that makes it a more complex financial product. To learn more about MetLife’s group variable universal life policy, contact the company directly.

MetLife life insurance endorsements

If you’re searching for the best life insurance, you may want to consider adding endorsements to your policy to more closely align your coverage with your needs. Unfortunately, MetLife does not list any information about riders on its website. This may be because MetLife focuses on employer-sponsored plans; different endorsement options might be available based on the agreement with each employer. To learn about life insurance riders from MetLife, contact the company directly or discuss your options with your employer (if MetLife provides your group life insurance options).

Keep in mind that riders will likely increase the cost of your life insurance, so you may not get the cheapest life insurance policy if you add them. However, the added protection may be well worth the extra cost, depending on your situation.

MetLife life tools and benefits

In addition to life insurance, MetLife also offers additional services to its members. Beneficiaries may be able to take advantage of the company’s grief counseling and checklists to help foster a sense of stability when a loved one passes. The company also offers funeral discounts, funeral planning services, will preparation services and transition planning.

MetLife customer satisfaction

If you’re shopping around and comparing life insurance quotes, customer satisfaction is an important area to consider. Life insurance rates may not vary between companies as much as home or auto insurance rates do — rates mostly depend on your age, health, the policy type you choose and how much life insurance you need — so looking at other aspects of each company can help you find the right option.

J.D. Power is a consumer data analytics company that puts out several service-oriented studies each year. MetLife has an above-average score in the 2022 J.D. Power U.S. Individual Life Insurance Study. Remember that MetLife no longer sells individual life insurance policies, so this score reflects its service to the customers who already own individual policies. However, it could still be a helpful metric, knowing that individual life customers seem to be generally satisfied with the service experience.

The National Association of Insurance Commissioner (NAIC) does give MetLife a complaint index for group life policies, which may be more helpful. A complaint index of 1.00 represents a normal or average number of complaints. MetLife’s group life insurance product has a score of 0.61. This means that the NAIC received fewer complaints about MetLife than average, which indicates a high level of service.

Finally, a company’s financial strength can be a useful tool, as it showcases a company’s historical ability to pay claims. MetLife has several different AM Best financial strength ratings, based on the underwriting companies it uses. Two of its companies, Metropolitan Life Insurance Company and Metropolitan Tower Life Insurance Company, have A+ (Superior) AM Best financial strength ratings. American Life Insurance Company and MetLife Insurance K.K. (which operates in Japan) are not rated by AM Best.

How to file a claim with MetLife

Filing a life insurance claim is an emotional endeavor, but MetLife seeks to make it as seamless as possible. If you are the beneficiary of a MetLife life insurance policy and need to file a claim, you can:

If you call for help, you’ll likely still have to fill out a claim form, but you may be guided by a licensed agent to ensure you choose the correct one. You may also need to provide additional documentation, such as a death certificate.

MetLife availability

MetLife is available in all 50 states and Washington, D.C. Product offerings may vary by state and MetLife’s agreement with your employer.

Other MetLife perks worth considering

MetLife’s product offerings are more limited as it no longer sells personal lines insurance coverage, but you may be interested in a few of its additional offerings:

Dental insurance: MetLife offers a number of dental insurance plans, including PPO plans, HMO/managed care plans and plans for veterans.
Vision insurance: MetLife’s various vision insurance options may help you save on exams, glasses and contacts. Some plans even offer discounts on LASIK eye surgery.
Pet insurance: Pet insurance is like healthcare coverage for your animal. This is one of the few plans that MetLife sells both individually and through employers.
Retirement solutions: In addition to insurance products, you might be able to use MetLife for your retirement plan too, if your employer offers this perk.

Keep in mind that MetLife doesn’t sell individual policies any longer. If your employer offers group life insurance through MetLife, you’ll need to work with your employer to gain access to these products.

MetLife corporate sustainability

MetLife could be a great option for consumers who are looking for companies with strong social responsibility programs. Since 1976, the MetLife Foundation has donated nearly $1 billion to help strengthen communities. The company is also focused on sustainability and has won numerous awards for its sustainability program. Finally, MetLife is focused heavily on diversity, equity and inclusion (DEI), outlining priorities to help foster a more diverse environment.

Not sure if MetLife is right for you?

Finding the right life insurance company for your needs involves doing some research to see which carriers closely align with your situation. One of the first steps is figuring out how much coverage you need, which you can do with the help of a licensed agent or even a life insurance calculator. Next, take a look at your needs and decide what policy type is best for you. Then you can start to look at carriers to see if they offer what you need. If you’re not sure if MetLife is right for you, these companies could be good options:

MetLife vs. Nationwide

If you’re looking for universal life coverage, Nationwide could be a good fit. The carrier offers high coverage limits and highly customizable policies that could fit a wide range of needs. Nationwide also offers auto and home insurance, along with numerous other insurance and financial products, and its life insurance products are available to individuals.

Learn more: Nationwide Insurance review

MetLife vs. MassMutual

If you need whole life insurance, which MetLife does not offer, MassMutual could be worth a look. The company has the highest AM Best financial strength rating possible and a long list of whole life insurance riders for personalization. MassMutual also offers universal and variable universal life, if you’re looking for those options without having to be part of a group plan like you would with MetLife.

Learn more: MassMutual Life Insurance review

MetLife vs. State Farm

The insurance behemoth could be a great choice for those seeking the best term life insurance. Additionally, the availability of local offices may be appealing to those who like to handle their insurance needs in person. State Farm offers numerous other insurance products and banking products, too, so it could be a good choice if you want to keep all your financial products in one place.

Learn more: State Farm Insurance review

Is MetLife a good insurance company?

MetLife might be a good life insurance company if your employer offers coverage for you. The company has generally high customer satisfaction reviews and offers helpful tools to beneficiaries, like funeral planning services and grief counseling. However, MetLife no longer sells individual policies like many of the other life insurance carriers we’ve reviewed, so it won’t be an option unless you can purchase coverage through your employer.

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Source: thesimpledollar.com

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May 26, 2023 by Brett Tams

In the past, you had to drive to your bank and work with a teller to manage your deposit accounts. These days, however, you have the option to complete virtually any banking need with any device that has internet access. You can pull out your smartphone and deposit a check. Or you may use your laptop to check your account balance.

That’s where banks called neobanks come in. It’s no surprise that neobanks are more popular than ever before. Let’s take a closer look at what they are and how they work so you can decide whether a neobank makes sense for your particular situation.

20 Best Neobanks

While traditional banks take up more market share than neobanks, you can still find a good amount of them if you do your research and shop around. The right neobank for you will depend on your unique lifestyle, needs, and preferences. To help you hone in on the ideal option, here’s our list of the top neobanks of 2023.

1. Chime

Founded in 2012, Chime is a financial technology company that offers banking services from The Bancorp Bank, N.A. and Stride Bank N.A. The Chime Checking Account is free of monthly maintenance fees and no minimum balance requirements.

Its perks include early direct deposit, automated savings features, access to over 60,000 or more fee-free ATMs, and free debit card replacement. In addition, you can take advantage of SpotMe and get up to $200 in fee-free overdrafts.

There’s also a Chime’s Savings Account, which offers a competitive interest rate with no cap on the amount of interest you can earn. Other services include Secured Chime Credit Builder Visa® Credit Card that doesn’t require a credit check, making it a suitable option if you have limited credit. Chime should be on your radar if you prefer a one-stop-shop for all of your banking needs.

You can read our full Chime review to learn more.

2. GO2bank

For more than a decade, Green Dot Corporation has specialized in alternative banking products. In 2013, GoBank made its debut as the first digital bank offering digital financial services. Then, in 2021, the company launched GO2bank, its second online bank.

GO2bank stands out from other neobanks which require you to sign up online because you can pick up their debit cards in person at Walmart and other popular retailers. GO2bank’s bank account tends to be a popular product in addition to its secured credit card that can help you build credit.

For a comprehensive overview, read our full GO2bank review.

3. Current

Since its inception in 2015, Current, which is not a bank, but a fintech company based in New York City, has partnered with Choice Financial Group and Metropolitan Commercial Bank to offer banking services. Its flagship products are a personal checking and debit card you can access via a mobile app on any iOS or Android device.

Even though Current’s product line is limited, the neobank prides itself on no shortage of perks and benefits. You can get your deposit up to two days early and earn cash back for debit card spending from more than 14,000 merchants. Additionally, Current doesn’t charge minimum balance fees or bank transfer fees and offers fee-free ATM withdrawals from ATMs in the Allpoint network.

If you would like to learn more, take a look at our Current review.

4. Revolut

Founded in 2015, Revolut is one of the largest European neobanks, serving more than 16 million customers. It has expanded its footprint to the U.S. market and has plans to become one of the most reputable neobanks in the world.

Revolut is unique in that it offers a wide array of financial services, such as bank accounts, debit cards, peer-to-peer payments, cryptocurrency, and currency exchange. It supports both individual consumers and businesses with more than 30 currencies. For a neobank with a diverse lineup of offerings, Revolut has you covered.

To learn more, read our full Revolut review.

5. Quontic Bank

Quontic Bank is a full-service, FDIC-insured online bank that was founded in 2002. It offers a range of banking products and services, including checking and savings accounts, credit cards, mortgages, and business banking solutions.

They offer some of the best annual percentage yields (APYs) in the industry. Quontic accounts come equipped with no overdraft fees, no incoming wire transfer fees, no monthly service fees, and access to over 90,000 surcharge-free ATMs.

Quontic also has a savings accounts feature called “Roundup”, which makes saving money simple and easy. In addition, they have a responsive U.S. based customer service team available to assist with any questions or concerns.

Read our full Quontic review for more information.

6. Dave

When Dave began in 2017, its sole focus was paycheck advances. Over time, it evolved to offer a checking account with no minimum balance requirements. If you become a Dave customer, you can receive early access to your paycheck, without a credit check or interest charges.

Dave also offers handy built-in budgeting features and doesn’t charge overdraft fees or ATM fees, as long as you use an ATM from the MoneyPass network. Dave may make sense if you’d like the option for small cash advances to get you through a financial hiccup from time to time.

See also: Free Online Checking Accounts: No Opening Deposit Required

7. Albert

Albert began as a money management app in 2016, but is now a personalized banking service that has attracted over 6 million customers. This digital banking account offers cash back and a range of benefits.

These including no-interest cash advances of up to $250, integrated budgeting and savings tools, and annual savings bonuses of up to 0.10%. There are no minimum balance requirements or overdraft fees. However, there is a minimum monthly fee of $4. Keep in mind that you’ll need to have an external bank account to open an account with Albert.

8. Varo

Varo Bank began in 2015 as a fintech company that partnered with The Bancorp Bank. In 2020, it acquired its own national banking charter, making it different from other neobanks you might come across. Even though Varo operates as an actual bank, it focuses on online banking via its website and mobile app.

Its checking account is free of monthly fees and there’s no minimum balance requirement. Plus it comes with a debit card. In addition, Varo partners with more than 55,000 ATMs through the Allpoint ATM network.

We can’t forget its other perks, such as contactless payments, credit cards with reporting to the major credit bureaus, early direct deposits, and no foreign transaction fee or transfer fees. Varo might be worthwhile if you’re looking for a checking account with all the bells and whistles.

Read our Varo Bank review to learn more.

9. Aspiration

Aspiration was founded in 2013 under the motto “Do Well. Do Good.” It partners with financial institutions like Coastal Community Bank and Beneficial State Bank to offer cash accounts, savings accounts, and a few investment accounts.

Aspiration’s most popular product is the Aspiration Spend & Save Account, which is a hybrid of a checking account and savings account. There’s also the Zero credit card, which offers cash back and plants a tree every time you make a transaction. Aspiration can be a good fit if you’d like to get rewarded for your spending and like the idea of one account for your checking and savings goals.

Read our full review of Aspiration to learn more.

10. Bluevine

Bluevine made its debut in 2013 as a fintech company with a mission to improve banking for small and mid-sized business owners. Its flagship product is the Bluevine Business Checking. It’s completely free and comes with a competitive annual percentage yield and unlimited transactions. This is rarely seen in the world of business checking.

In addition to the business checking account, Bluevine offers financing products, such as lines of credit of up to $250,000. Bluevine should be on your radar if you’re a business owner in search of fast, convenient startup banking and financing.

11. SoFi

Social Finance or SoFi entered the market as a student loan refinance company. Recently, however, the fintech company received its own bank charter to offer digital banking services. You can use the SoFi Checking and Savings combo account to manage your spending and saving needs in one place.

Fortunately, SoFi doesn’t charge monthly maintenance fees, overdraft fees, and ATM fees. Additional perks and extras include no-fee overdraft coverage, sub accounts for various savings goals, and additional products like credit cards, cryptocurrency trading, and retirement accounts, like an individual retirement account.

Read our full review of SoFi to learn more.

12. Acorns

Acorns has a reputation as an easy-to-use micro investing app. Since 2012, many people have downloaded it on their iOS or Android devices to invest their spare change. Over time, Acorns has expanded to offer a checking account.

You can open Acorns Checking for free and enjoy perks such as no monthly or overdraft fees, early direct deposit, mobile check deposit, and access to a network of 55,000 ATMs.

The checking account seamlessly integrates into the Acorns micro investing feature. Plus when you use your Acorns debit card, you can earn cash back at participating retailers and use it to invest, along with your spare change. If you’d like to get started with investing, Acorns is worth considering.

13. One

One is a neobank owned by Walmart. It offers a budget-friendly overdraft program with customized budgeting and savings options for its customers. One’s banking account allows users to organize their money into subaccounts called Pockets.

Pockets offer saving rates of 1% on up to $5,000 for any customer and 1% on up to $25,000 for customers with direct deposit. Additionally, One provides fee-free overdraft coverage of up to $200 for customers with direct deposits of at least $500 per month.

14. Cheese

Cheese is a digital banking platform that was launched in March 2021 and caters specifically to the immigrant and Asian American communities. It offers up to 10% cash back at 10,000 businesses, including Asian-owned businesses and restaurants.

Cheese’s customer support is available in English and Chinese, with more languages to be added in the future. One of the benefits of opening an account with Cheese is that accounts earn interest and do not have monthly fees or ATM fees when using the national MoneyPass ATM network.

15. Unifimoney

Unifimoney is a money management and investment app that helps you manage your banking, investing, and borrowing needs all in one place. It caters to account holders who earn at least $100,000 per year but have significant amounts of student debt. You can download Unifimoney to pay bills, deposit checks, and write checks.

It’s unique in that it also allows you to refinance student loan debt and can create a diverse investment portfolio with particular stocks, cryptocurrencies, precious metals, stocks, and exchange-traded funds (ETFs).

In addition, you can turn to Unifimoney for insurance products, like car insurance and health savings accounts (HSAs). If you’d like to get started with Unifimoney, open the Unifimoney high-yield checking account with as little as $100.

16. NorthOne

Headquartered in New York and founded in 2016, NorthOne offers digital business banking services. If you’re a startup, entrepreneur, or small business owner, NorthOne can be a good fit. It differs from other banks that serve businesses in that there are no transaction limits that require premium upgrades.

You can open a business bank account for a flat $10 monthly fee and won’t have to worry about additional fees for deposits, transfers, ACH payments, or app integrations. In addition, you’ll get to create as many “Envelopes” or sub accounts as you want so you can save for payroll, taxes, and other business needs.

17. Oxygen

San-Francisco based Oxygen focuses on two accounts: the free thinker account for individuals and the pioneer account for business users. Even though it doesn’t charge fees, like monthly fees, ACH fees, and overdraft fees, you will have to pay an annual fee that can go up to a few hundred dollars.

While most neobanks don’t allow for cash deposits, Oxygen does. As long as you have an Oxygen bank account, you can make deposits at GreenDot locations, which are usually located inside popular retailers, like Walmart, Walgreens, and CVS. If you don’t mind paying an annual fee and like the convenience of being able to deposit cash, Oxygen is worth exploring.

18. Bella

Bella is a fairly new player in the neobanking space. Its partner bank is nbkc bank, which allows it to provide banking services. With Bella’s checking account rewards program, you can receive a random percentage of cash back on randomly selected purchases.

The cash back amount may be anywhere from 5% to 200%. Like most neobanks, Bella doesn’t charge monthly fees, ATM fees, and overdraft fees. You can also opt for a no-fee savings account. Bella accounts are FDIC insured for up to $5,000,000.

19. Lili

Lilli services small business owners and believes that managing two accounts is a hassle. That’s why this neobank offers a single account you can use for both your business and personal transactions.

Come tax time, Lili will eliminate financial stress and let you automatically save a certain percentage of your income into a “tax bucket.” Plus, it produces quarterly and yearly reports instantly, reducing your tax prep costs. While the Lili Standard account is free, Lili Pro will run you a couple dollars per month.

If you upgrade to Lili Pro, you’ll get cashback rewards on all your debit purchases and 1% interest on your savings accounts. Lili could be a solid pick if you’re a freelancer or solopreneur hoping to simplify your finances.

20. Monzo

Monzo is a UK-based neobank that just opened up to the U.S. market in late 2022. All accounts are insured by the FDIC for up to $250,000. Plus fee-free withdrawals are available at more than 38,000 ATMs.

Furthermore, Monzo is similar to Aspiration as it strives to protect the planet. Additionally, this neobank offers budgeting tools that can help you meet various savings goals.

What is a neobank?

Often called challenger banks, neobanks have recently entered the financial services industry and challenged banking norms. Most neobanks are financial technology or fintech companies that offer the same banking services you may find at traditional banks, like Bank of America or PNC.

But they promote innovation and act like digital only banks or online banks as they don’t have any physical branches and operate via apps. Most of these apps are user-friendly and loaded with a variety of handy features, such as early deposit and savings tools to simplify the banking experience. They are specifically designed to give you greater control of how you manage and spend your money.

Also since neobanks don’t have any physical branches, their overhead costs and customer acquisition costs are low and enable them to offer more affordable banking products and services. Many neobanks let you choose from a number of free and paid premium subscription services.

Are neobanks safe?

Since neobanks are fairly new and different from many traditional banks, you might wonder whether they’re safe. Fortunately, most of them are very safe because they operate within a regulated market.

These financial institutions typically work with U.S. banks to offer FDIC-insured accounts, which protect your money from potential bank failures and the losses that come with them. To help determine if a neobank is safe, check out their ratings and reviews on reputable websites like the Better Business Bureau (BBB).

Neobanks vs. Traditional Banks

To further explain neobanks and their modern spin on traditional banking, let’s take a closer look at how they differ from traditional banks.

Neobanks

Neobanks operate without physical branches. To take advantage of their offerings, you’ll likely need to download an app and provide some personal information.

While you can expect fewer banking and credit products than you’d find at traditional banks, you’ll reap the benefits of lower fees and extras that improve the overall banking experience.

Some neobanks have decided to expand their lineup of products and services to create more of a one-stop-shop you’d get from a traditional bank. Since most neobanks don’t earn money from lending, like incumbent banks, their business model depends on interchange fees or transaction fees, which usually come from debit cards. They might also charge for premium accounts and extra features.

Traditional Banks

Traditional banks often have brick-and-mortar locations across the country or in a specific geographic region or area. But many of them also have digital banking divisions in which you can perform banking services online.

Most banks focus on strong customer relationships and earning interest through loans as well as account fees from banking, lending, and investing. They typically target customers who appreciate customer engagement and a traditional in-person banking experience.

See also: Best Alternatives to Traditional Banks

Pros & Cons of Neobanks

Just like all types of financial institutions, neobanks have benefits and drawbacks you should consider, including:

Pros

Lower fees: Compared to traditional banks, neobanks offer lower fees. That’s because they don’t have the high overhead costs associated with the upkeep of physical branches.
Higher rates: Neobanks often pride themselves on higher interest rates on their checking and savings accounts. This can make it easier and faster for you to save money.
Convenience: Perhaps the greatest benefit of neobanks is the convenience they bring. You can perform a variety of banking tasks, like depositing checks or making payments from your smartphone device, round-the-clock.
Easy access: You can manage your banking 24/7 without ever having to leave your home and visit a local branch. All you have to do is download an app from the app store.
Simple setup: It’s usually fast and easy to open an account with neobanks. Many of them will approve you, regardless of your credit score or credit history.
Focused services: While most neobanks don’t offer all the services you might find at traditional banks, the few services they do provide focus on service quality and are typically loaded with perks and benefits. For example, you can get a no fee checking account with cash back rewards.

Cons

No bank charters: Neobanks don’t have bank charters. Instead, they often partner with traditional banks to insure their products. Before you move forward with a neobank, ensure they partner with a Federal Deposit Insurance Corp or FDIC-insured bank and offer their own FDIC insurance.
Customer service restrictions: Since neobanks operate on app instead of through physical branches, customer service can be a downside. You may have to turn to chatbots or social media for basic banking questions and support. If you notice fraud in your account, it may be more difficult to resolve the issue.
Fewer services: Traditional banks usually pride themselves on a long list of services, including loans, wealth management, and brokerage services. Neobanks, however, tend to limit their offerings to checking accounts and savings accounts.
Unproven track record: Neobanks are still in the startup phase as many made their debut within the last few years. This means that they may fail and force you to look elsewhere for your banking needs.
Require knowledge of technology: While most neobank apps are intuitive and designed for the average person to use with ease, they may still be inconvenient for some people. If you don’t consider yourself tech literate, a neobank might not make sense.

Bottom Line

There’s no denying that neobanks have revolutionized the banking industry and financial industry. If your primary goal is convenience and you prefer mobile or online banking, a neobank can be a great alternative to a traditional bank or legacy bank. Just make sure you explore all your options and read the fine print before you choose one.

Source: crediful.com

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May 24, 2023 by Brett Tams

You May Be Eligible to Save Over $10K in an HSA in 2024 After Largest-Ever Contribution Limit Increase

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People with health savings accounts (HSAs) got some good news this week when the IRS rolled out the largest contribution limit increases in history.

In 2024, an individual with self-only coverage can save up to $4,150 in an HSA, while a family can sock away up to $8,300. Catch-up contributions still allow people 55 and older to save an extra $1,000 per year, meaning some married couples will soon be allowed to save more than $10,000 in an HSA.

A financial advisor can help you plan for retirement, including your future healthcare costs. Find an advisor today.

HSAs are tax-advantaged savings vehicles that help people enrolled in high-deductible health plans (HDHPs) save for annual medical expenses. But unlike flexible spending accounts (FSAs), funds in an HSA can be carried over from year to year, making these accounts an important component of long-term financial plans.

Largest Increases on Record

Next year’s HSA contributions limit increases will be the largest on record since HSAs were first introduced in 2003. The IRS adjusts these limits each year to keep pace with inflation.

For individuals, the savings cap will rise 7.8% from $3,850 in 2023, while families will see their limit increase 7.1% from $7,750. A year ago the limits rose 5.5% and 6.2%, respectively. However, persistent inflation is pushing these caps even higher on Jan. 1, 2024.

HSA contribution limits for an individual with single, self-coverage:

2023: $3,850
2024: $4,150

HSA contribution limits for an individual with family coverage:

2023: $7,750
2024: $8,300

The changes will also affect what constitutes an HDHP. In 2024, health plans will qualify for HSAs if their deductibles are at least $1,600 for self-only coverage and $3,200 for family coverage.

Why HSA Contribution Limits Matter

Higher contribution limits not only mean that people can save more for qualified medical expenses, but they also provide an even larger potential tax break for HSA owners. Since contributions are tax-deductible, higher caps mean a person with an HSA will be able to reduce his taxable income by several hundred dollars more in 2024 than in 2023.

Of course, that’s not the only tax advantage of an HSA. Money that’s kept in this type of account also grows tax-free and can be withdrawn free of tax, provided it’s used to pay for qualified expenses.

And since HSA funds carry over each year, they’re a great way for pre-retirees to save up for the onerous healthcare expenses they may encounter in retirement.

A recent study from the Employee Benefit Research Institute found that despite the coverage offered by Medicare, retirees should prepare to pay significant out-of-pocket costs for their healthcare. These costs include a wide range of expenses, including insurance premiums, program deductibles and prescription drug treatments.

In fact, even with supplemental Medicare gap insurance, men will need an average of $166,000 in savings to pay for their healthcare needs in retirement. Since women have longer expected lifespans, that number is even higher: $197,000. Meanwhile, the average two-person household should anticipate needing $318,000, according to EBRI.

Bottom Line

With inflation remaining elevated, the IRS has increased the amount of money that individuals and families can save in their HSAs in 2024. The contribution limit increases are the largest on record. People with self-only coverage will be able to sock away $4,150 in 2024, while families will be permitted to save $8,300. The $1,000 catch-up contribution remains unchanged, meaning married couples can save $10,300 in an HSA in 2024.

Tips for Contributing to an HSA

Some HSAs allow you to invest your contributions in mutual funds and other financial products. Be sure to read our latest HSA investment guide to help you determine how you should invest your HSA funds. Our asset allocation calculator can also help you find an investment mix that suits your tolerance for risk.
A financial advisor can help you integrate your HSA savings into a comprehensive financial plan. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Photo credit: ©iStock.com/Nastassia Samal, ©iStock.com/shapecharge, ©iStock.com/FatCamera

Patrick Villanova, CEPF®
Patrick Villanova is a writer for SmartAsset, covering a variety of personal finance topics, including retirement and investing. Before joining SmartAsset, Patrick worked as an editor at The Jersey Journal. His work has also appeared on NJ.com and in The Star-Ledger. Patrick is a graduate of the University of New Hampshire, where he studied English and developed his love of writing. In his free time, he enjoys hiking, trying out new recipes in the kitchen and watching his beloved New York sports teams. A New Jersey native, he currently lives in Jersey City.

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Source: smartasset.com

Apache is functioning normally

May 24, 2023 by Brett Tams

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No financial institution can be all things to all people, but some come pretty close.

BMO Harris Bank is one of those banks. It’s a full-service bank with hundreds of branches in the United States (mainly in the Midwest and Southwest) and thousands of fee-free ATMs. With a comprehensive array of checking and savings accounts, plus credit cards, auto loans, and more, BMO Harris Bank is about as close as a bank can come to being a one-stop shop.

Does that mean BMO Harris Bank is right for you? Not necessarily. Plenty of other high-quality banks vie for your deposits every day. See whether BMO is the best fit — or whether you should see what else is out there instead.

What Is BMO Harris Bank?

BMO Harris Bank N.A. is an American bank that provides consumer and business banking services online and through a network of physical branches. Eligible deposits with the bank are FDIC-insured up to statutory limits set by Congress.

Its deposit accounts include checking, savings, money market, and certificates of deposit (CDs), and it also offers credit products like credit cards, mortgages, auto loans, personal loans, and private student loans. BMO Harris Bank has a wealth management division that focuses on relatively high net worth individuals and families, but no self-directed brokerage platform.

Is BMO Harris Bank a good place to park your cash, borrow money, and invest for the future? I’ve reviewed dozens of online banks and brick-and-mortar financial institutions over the years, and I believe BMO Harris Bank is in the upper echelon of the brick-and-mortar group. In other words, it’s one of the best traditional banks to work with — in part because it has embraced technology and innovation in a way that many of its competitors haven’t.

How BMO Harris Bank Stacks Up

BMO Harris Bank is a full-service financial institution that consistently ranks among the top traditional banks for U.S.-based consumers.

It competes not only with other big banks like Chase Bank and Citibank but with major online banks as well. If you’re torn between an “innovative incumbent” like BMO Harris Bank and an “established upstart” like Ally Bank, see for yourself how the two compare.

	BMO Harris Bank	Ally Bank
Monthly Maintenance Fees for Checking	None on the BMO Harris Smart Advantage™ Account	None
Savings Account Yields	Relatively low	3.60% APY
CD Yields	Up to 4.50% APY	Up to 4.25% APY
Credit Products	Credit cards, mortgages, credit-builder loans, home equity products, personal loans, auto loans, private student loans	Credit cards, mortgages, home equity products, auto loans
Self-Directed Brokerage	No, managed investments only	Yes
Physical Branches	Yes, in Illinois, Arizona, Wisconsin, Indiana, Florida, Missouri, Kansas, and some other states	No

What Sets BMO Harris Bank Apart?

Where does BMO Harris Bank get its edge? Out of all the bank’s advantages and selling points, three things really stand out:

A Checking Account With No Monthly Maintenance Fee, Period. The BMO Harris Smart Advantage™ Account is a truly free checking account. It doesn’t charge a monthly maintenance fee, period, regardless of balance or relationship status with BMO, yet it’s packed with features. It’s rare to find an account like this at a big bank.
One-Stop Shop for Credit. Even Ally Bank, probably the best online bank for borrowers, doesn’t bother with certain credit products. BMO Harris Bank has a comprehensive lineup of loans and lines of credit, from home and auto loans to personal and student loans.
Excellent CD Rates (For a Traditional Bank). BMO Harris Bank’s CD rates are competitive with the top online banks for CD customers. And they blow most traditional banks’ CD rates out of the water.

Key Features of BMO Harris Bank

BMO Harris Bank has a comprehensive lineup of deposit accounts and loans, plus some nice value-adds like account opening bonuses and a handy digital app. See what to expect from its products and how to determine which, if any, are right for you.

Account Opening Bonus Opportunities

BMO Harris Bank has some fantastic new account opening bonus opportunities for new checking customers.

BMO Harris Premier^TM Account — $350 Cash Bonus

This one is best for higher-income folks who have no problem meeting the direct deposit requirement. Here’s how it works:

Open a new BMO Harris PremierTM Account by July 14, 2023, and receive a total of at least $7,500 in qualifying direct deposits during the first 90 days of account opening. If you do, you’ll get a $350 cash bonus in your account.

This new checking account offer is not available for current BMO Harris personal checking customers, nor to customers who closed a personal checking account within the past 12 months. Open on-line or in branch; accounts subject to approval.

BMO Harris Smart Advantage^TM or BMO Harris Smart Money^TM Account — $200 Cash Bonus

If you can’t notch $7,500 in qualifying direct deposits during the first 90 days, this bonus could be right for you. It’s nearly as generous:

Open a new BMO Harris Smart AdvantageTM or Smart MoneyTM Account by July 14, 2023, and receive a total of $4,000 in qualifying direct deposits within 90 days of account opening. Do this and you’ll get a $200 cash bonus in your account.

The same restrictions apply to this offer — you must be a new BMO Harris personal checking customer and can’t have had a BMO Harris personal checking account within the past 12 months.

Checking Accounts

BMO Harris Bank offers three consumer checking accounts, each with its own clear use case. All offer access to in-branch and online banking, plus low- or no-fee transactions at more than 40,000 in-network ATMs:

BMO Harris Smart Advantage™ Account: With no monthly maintenance fee, this account is ideal for folks with modest incomes and low-ish balances — folks who wouldn’t be able to avoid monthly maintenance fees at most big competitor banks.
BMO Harris Smart Money^TM Account: Is a $5 monthly maintenance fee worth it for no overdraft fees, ever? If you occasionally dip into the red, probably yes. And there’s no maintenance fee if you’re under age 25, making this a solid student checking account.
BMO Harris Premier™ Account: BMO’s fanciest checking account entitles you to relationship benefits like up to $25 in monthly out-of-network ATM fee reimbursement and 0.50% off your home equity line’s interest rate. Benefits increase with your total BMO deposit balance.

Like all banks, BMO charges some account fees beyond the headline monthly maintenance fees (where present). Here’s how the Smart Advantage Account’s fee schedule looks:

Fee Type	Fee Amount
Monthly Maintenance Fee	$0
Allpoint and BMO Harris ATM transactions	$0
Non-BMO ATM transactions	$0
Paper statements	$2, but $0 when you opt into paperless
Check images	$3, but $0 when you opt into paperless
Overdraft fee	$15, but $0 when you opt into overdraft services
Minimum opening deposit	$25

Savings Builder Account

The Savings Builder Account is BMO Harris Bank’s standard savings account. There’s a $25 minimum opening deposit and no monthly maintenance fee.

Savings Builder’s defining feature is a $5 reward for each month you save at least $200 during the first year. Save $200 per month for all 12 months of the first year from account opening and you’ll clear a cool $60 in extra cash.

Moving forward, the Savings Builder Account has a negligible yield — just 0.01% APY. First-year deposit bonus aside, it’s not suitable if you’re looking for a high-yield savings account. On the bright side, it doesn’t have the usual savings account transaction limit. You’re free to make as many withdrawals as you like without incurring a penalty.

Money Market Account

BMO Harris Bank’s money market account has a higher yield than the Savings Builder Account. However, the yield requires a paired Premier checking account, and your actual return depends on how much you have on deposit across all BMO accounts.

To get the best rates — 2.00% higher than the baseline — you need at least $250,000 in deposits with BMO. And you need at least $10,000 in the money market account to avoid the $10 monthly maintenance fee.

Needless to say, this one’s better if you have a lot of cash on hand.

Certificates of Deposit

BMO Harris Bank offers standard CDs with terms ranging from three months to 60 months (five years). All require a minimum opening deposit of $1,000 and charge interest penalties if you withdraw principal before maturity.

BMO’s standard CD rates are not competitive. The longer-term products earn less than 0.50%, compared with 4.00% APY or higher at the best online banks for CDs.

BMO does offer CDs with competitive rates though. These special CDs, as they’re known, earn upwards of 4.00% APY on terms ranging from 13 to 59 months. They require a minimum deposit of $5,000, but if you can swing that, they’re well worth it.

You can structure select CDs as individual retirement accounts (IRAs) and enjoy tax-deferred or tax-free growth.

Individual Health Savings Account

BMO Harris Bank is one of relatively few banks that offer direct-to-consumer health savings accounts (HSAs). If you’re enrolled in an individual or family high-deductible health plan (HDHP) not through your employer, a BMO Harris Bank HSA can help you save for planned and unplanned medical expenses — or save for retirement if you stay healthy.

BMO’s HSA is delivered by Lively, a leading provider of individual HSAs. There are no ongoing or hidden service fees or monthly fees — you pay nothing out of pocket for the account — and you can withdraw money at any time to cover eligible health care expenses without paying taxes. Your contributions may be tax-deductible as well.

Credit Cards

BMO Harris Bank has four consumer credit cards, although its lineup has changed in the past and could in the future:

BMO Harris Bank Platinum Rewards Mastercard®. Earn 2 points per $1 spent on eligible gas and groceries, up to $2,500 in combined purchases each calendar quarter. Plus, get 10% bonus points on your cardmember anniversary each year (based on prior-year spending) and 0% introductory APR on balance transfers for 12 months from date of first transfer (must be completed within 90 days from date of account opening).
BMO Harris Bank Premium Rewards Mastercard®. Earn 3 points per $1 spent on eligible dining, hotels, and airfare, up to $2,500 in combined spend each calendar quarter, plus 15% bonus points on your anniversary. The same first-year balance transfer promotion applies, but there’s a $79 annual fee after the first year.
BMO Harris Bank Cash Back Mastercard®. Get 5% cash back on eligible streaming and cable/satellite TV purchases and 3% cash back on eligible gas and grocery purchases, up to $2,500 in combined spend per calendar quarter. Plus, get up to $400 in cellphone protection (restrictions apply) and the same first-year balance transfer deal.
BMO Harris Bank Platinum Mastercard®. If you need to finance a major purchase, this is your card. Enjoy 0% APR for 15 months from account opening on purchases and balance transfers.

Loans and Lines of Credit

BMO Harris Bank offers a full lineup of loans and lines of credit:

Mortgage loans, including fixed-rate and variable-rate conventional loans, jumbo loans, and specialty loans like VA and FHA mortgages
Home equity products, including home equity loans and lines of credit
Specialty property loans for bank-owned properties — BMO is one of the few banks that connects consumers with distressed property opportunities
Unsecured personal loans and lines of credit
Savings secured loans — borrow against your savings balance
Credit-builder loans — ideal for people just beginning their credit journeys
Auto loans
Private student loans and student loan refinancing

Premier customers may qualify for rate discounts and other benefits on select loan products.

Wealth Management Services

BMO Harris Bank has a team of in-house wealth advisors who offer financial planning and investment management services customized to your needs. One thing to note here: BMO doesn’t have a self-directed brokerage, so if you prefer to manage your own funds, you’ll need to look elsewhere.

Mobile Banking App

The BMO Harris mobile banking app is compatible with Android and iOS devices. It’s capable of handling most everyday banking functions, including online bill pay, money transfers, and statement review.

Advantages of BMO Harris Bank

BMO Harris Bank has a lot going for it. These are its most notable advantages.

Actually Has a Free Checking Account With No Minimum Balance. BMO Harris Bank is one of the few big banks that has a truly free checking account: the Smart Advantage Account. Most competitors require you to jump through some sort of hoops to avoid a monthly fee or impose age-based restrictions you can’t avoid.
Offers a Health Savings Account for Individuals. BMO Harris Bank’s individual HSA is another rarity among big banks. And it’s backed by Lively, a leader in the HSA space.
Built-in Free Overdraft Protection With Smart Money. BMO’s Smart Money Account doesn’t charge for overdrafts, period. Call it complimentary overdraft protection — it’s a big deal if you sometimes cut it close.
Impressive Range of Deposit Accounts and Loans. BMO Harris has three checking accounts, several savings products, and just about every major type of consumer loan you can imagine. It’s a one-stop shop for consumer financial products and services.
Competitive Rates on Special CDs. If you can meet the $5,000 minimum balance requirement, BMO’s special CDs are a great deal. Yields range from 2.00% to 3.00% annual percentage yield and appear responsive to changes in benchmark interest rates.

Disadvantages of BMO Harris Bank

Consider these potential drawbacks before opening an account with BMO Harris Bank.

Poor Savings Account Yields. BMO’s Savings Builder Account has a very poor yield. It’s not even worth talking about, frankly — if you’re in the market for a high-yield savings account, look elsewhere.
Standard CD Rates Aren’t Competitive. BMO’s standard CD rates aren’t competitive either. Fortunately, as long as the special CDs are available, you don’t have to bother with them.
Special CDs Have High Minimum Balance Requirements. BMO’s special CDs have high minimum balance requirements ($5,000). If that’s tough for you to swing, you may need to look elsewhere for competitive CDs.
Premier Benefits Have High Balance Requirements. BMO’s Premier relationship tiers offer lots of potentially valuable perks and benefits, but you have to hold up your end of the bargain by bringing tens of thousands of dollars to the table. The juiciest perks are reserved for people with at least $250,000 in eligible BMO accounts.

Is BMO Harris Bank Legit?

Yes, BMO Harris Bank is legit. It’s the eighth largest bank in North America by assets and serves more than 12 million customers on both sides of the U.S.-Canada border. It has been in business for nearly 200 years and has paid dividends to shareholders for virtually all of that time — dividends that have steadily increased over the decades.

For U.S.-based customers, BMO Harris Bank is a Member FDIC institution, which means eligible deposits are insured up to statutory limits by the Federal Deposit Insurance Corporation. When you open a checking, savings, money market, or CD account with BMO Harris, you can rest assured that your money is backed by the full faith and credit of the U.S. government — up to $250,000 per account type.

Final Word

BMO Harris Bank is a full-service financial institution that has been in business for hundreds of years and serves millions of customers in the U.S. and Canada. It’s accessible through a network of physical branches (mostly in the Midwest and Southwest), through thousands of in-network ATMs, and online and through the BMO Harris Bank mobile app from anywhere.

BMO Harris Bank stands out for several reasons. It has one of the best no-maintenance-fee checking accounts of any big bank. It offers a comprehensive lineup of savings products, although its actual savings accounts don’t have competitive yields. And it’s basically a one-stop shop for consumer credit, from credit cards and auto loans to mortgages and education financing.

If you’re in the market for a new bank, I’d encourage you to give BMO Harris Bank serious consideration. It’s not perfect, to be sure, but it’s better than most.

Editorial Note:
The editorial content on this page is not provided by any bank, credit card issuer, airline, or hotel chain, and has not been reviewed, approved, or otherwise endorsed by any of these entities. Opinions expressed here are the author’s alone, not those of the bank, credit card issuer, airline, or hotel chain, and have not been reviewed, approved, or otherwise endorsed by any of these entities.

Brian Martucci writes about credit cards, banking, insurance, travel, and more. When he’s not investigating time- and money-saving strategies for Money Crashers readers, you can find him exploring his favorite trails or sampling a new cuisine. Reach him on Twitter @Brian_Martucci.

Source: moneycrashers.com

Apache is functioning normally

May 24, 2023 by Brett Tams

Sometimes it can seem like banks always put profits over the people they serve, but several U.S. banks are committed to doing just the opposite.

I found 15 banks that shape their business models around community support and environmental sustainability. Many of them even qualify as B Corporations, which have to abide by legal requirements such as a diverse workforce, sustainable practices, and more.

What’s Ahead:

Overview of the best socially responsible banks

Bank or credit union	Best for	Are they a Certified B Corporation?	Unique feature
National Cooperative Bank	Cooperatives	No	Real estate mortgages for homeowners with low to moderate income
Southern Bancorp	Those who live in rural areas	No	Free financial education center
Amalgamated Bank	Those who support sustainable business	Yes	Donate your spare change with their “Donate the Change” program
Ando Savings	Tracking the effect of your investment	Yes	Auto-save by rounding up debit card purchases
BankPurely	Investing in planting trees	No	One tree is planted for every SavingPurely account opened
Aspiration Bank	Knowing how your spending stacks up to your values	Yes	Investment accounts with fossil fuel-free portfolios
Clearwater Credit Union	Montana small businesses	No	All-in-one banking options
Verity Credit Union	Entrepreneurs in underserved communities	No	Microloans
Virginia Community Capital (VCC)	Real estate entrepreneurs taking on eco-friendly construction projects	Yes	The Revolving Loan Fund that fills financial gaps for investors who can’t afford commercial financing
Central Bank of Kansas City	Tax help and Missouri residents	No	Incentives to invest in economically disadvantaged areas
Carver Federal Savings Bank	Those looking to help support the Black community	No	They donate to local communities
First Green Bank	Those in economically disadvantages areas	No	A loan plan for homeowners who wish to install solar panels
Mascoma Bank	Those living in low-income cities in New England	Yes	Loans for energy-efficient renovations
City First Bank	Those who want to support the development of low-income communities	Yes	Through CDARS, customers can make larger, FDIC-insured deposits
Beneficial State Bank	Those with less than perfect credit	Yes	Underwriters consider factors other than credit score

Best national banks for socially responsible banking

These banks have brick-and-mortar branches, but they’re large enough to have seamless online and mobile account services, as well as multiple resources for customers and borrowers.

National Cooperative Bank

Best Mortgage Lenders of 2021: Which Lender Is Right For You? - National Cooperative Bank The National Cooperative Bank began as a lender to business cooperatives that meet community needs, including grocery stores, health centers, nonprofits, housing co-ops, credit unions, and more.

Cooperatives remain their main lending focus, but NCB also specializes in real estate, mortgages for homeowners with low or moderate incomes, and loans for solar energy installation. They’ve branched into personal banking as well, and personal or commercial accounts can be opened online from anywhere in the United States.

Like many socially responsible banks, NCB prioritizes investments in renewable energy projects, and they don’t invest in fossil fuels.

Some of their standout features include:

Member of the Global Alliance of Banking on Values (GABV), a worldwide banking network with a commitment to economic and environmental sustainability.
Personal checking and savings accounts come with up to 0.50% Annual Percentage Yield (APY).
Retirement accounts include IRAs, Roth IRAs, and IRA rollovers.

Learn more about the National Cooperative Bank.

Southern Bancorp

Southern Bancorp is a huge organization with banking, lending, community development, and more services under its $1.1 billion-asset umbrella, but don’t let the size fool you — this bank provides big solutions for small communities, with a commitment to expanding opportunity in rural areas.

In addition to the basics like checking, savings, and lending, Southern Bancorp has a robust public policy advocacy division where they work to promote laws that have positive financial impacts on working families. There’s also a free financial education center with credit counseling and tax prep services.

Since Southern Bancorp is headquartered, and specializes in, the Arkansas and Mississippi Delta regions, physical branches are mostly in this region. But customers from anywhere in the U.S. can open personal or business accounts online.

The bank’s leadership demographic reflects the community it serves; the CEO and 50% of the board members are Black.

Their unique features include:

A Community Development Financial Institution (CDFI).
Certified B-Corporation or B-Corp — a designation reserved for organizations committed to responsible practices.
Personal checking and savings accounts, including accounts designed for specific financial goals.
Online banking is available anywhere with internet access.
Home, auto, and personal loans.

Learn more about Southern Bancorp.

Amalgamated Bank

15 Banks and Credit Unions Putting Social Responsibility First - Amalgamated Bank Headquartered in New York and Washington D.C., Amalgamated Bank extends online checking and savings account access across the United States. They’re committed to sustainable business practices within their own walls. Employees earn a minimum hourly wage of $20/hour, above the federal minimum, and over 30% of employees are union members. The business strives to be 100% carbon-neutral in its operations.

Amalgamated makes its lending priorities clear from the start. They don’t lend to fossil fuel companies, weapons manufacturers, or private prison operators. Instead, they focus on lending to companies in the solar energy or sustainable food industries. If you invest with Amalgamated, you can opt for a portfolio that’s fossil-fuel-free.

And they’re the first major U.S. bank to endorse HR 40, the bill calling for a national commission to establish reparation payments for Black Americans.

Their standout features include:

Certified B Corp and member of the GABV.
Online personal checking and savings accounts with 0.10%-0.40% APYs.
Restart Checking accounts available for customers with poor credit.
Give-Back savings accounts donate half your interest (0.30% APY) to an organization of your choice.
An optional “Donate the Change” program rounds up your purchases and donates the change to a cause the bank selects.
Over 40,000 free in-network ATMs for customers outside NY and D.C.

Learn more about Amalgamated Bank.

Ando Savings

Ando is another bank that puts the environment front and center. They’ve pledged 100% of their investments to initiatives supporting sustainable practices, like agriculture and public transit.

Investors can track the effect of their own investment dollars in the Ando mobile app’s Impact Center, which traces financial impact across five categories including clean energy, sustainable transportation, and green buildings.

You’ll find the following with Ando:

Spending and savings accounts, as well as a Visa debit card, are available to anyone in the U.S.
Accounts have no fees or minimum balances.
Ando’s Count the Change program helps you “auto-save” by rounding up debit card purchases to the nearest dollar and moving the difference from spending to savings.

Learn more about Ando.

Best online banks for socially responsible banking

These banks are fully digital — not only is the all-mobile bank trendy and convenient, but its format also allows the bank to live a little lighter on the earth, with no energy use from physical branches.

BankPurely

BankPurely is the digital arm of NYC-based Flushing Bank, a bank that invests most of its money in community initiatives. As a fully online operation, BankPurely has formal PayItGreen approval for reducing its paper waste and carbon footprint.

They’re currently partnering with Plant-It 2020 to plant indigenous trees in New York State. Ando is one of many socially progressive banks that works with a tree-planting organization, taking a small but important step to counteract climate change.

A few great features include:

Checking, savings, and money market accounts available, with up to 0.25% APY on savings accounts and 0.5% on money market accounts.
CDs are available with 0.55% APY, and Ando will plant a tree for every CD you open.

Learn more about BankPurely.

Aspiration

Aspiration is one of the best-known socially responsible online banks, with multiple account options for the conscious customer. Their “pay what’s fair” fee model for a basic checking account is a rare offering even for the most flexible banks (and yes, paying $0 in fees is an option).

Both the free and fee-based “Aspiration Plus” checking accounts give you a personal impact score to see how your spending stacks up against your values. Accountholders get 3%-10% cash back when they buy anything from Aspiration’s Conscience Coalition partner vendors — an incentive to shop for the greater good.

The bank is currently rolling out a credit card that will reward shoppers who make carbon-friendly financial choices.

Here are a few key features:

Certified B Corp and member of global environmental organization 1% for the Planet.
Aspiration Plus savings accounts ($5.99/month) offer up to 5.00% APY.
Investment accounts available with fossil fuel-free portfolios.
IRA retirement accounts.
As a donor, Aspiration prioritizes funding microloans for low-income recipients.

Learn more about Aspiration or read our full review.

Best regional banks and credit unions for socially responsible banking

Some regional banks offer online accounts to residents elsewhere in the U.S., while others are only open to residents of a certain state or region. Here’s a cross-section of ethical standouts across the country.

Clearwater Credit Union – Montana residents

15 Banks and Credit Unions Putting Social Responsibility First - Clearwater Credit Union As Montana’s largest CDFI and a member of Inclusiv, an organization serving residents in low-income communities, Clearwater Credit Union is making its mark nationally but keeping a local focus.

They loan primarily to local businesses and offer a solid selection of financial services to customers.

Here are a couple of great features they offer:

Checking and savings accounts are available.
Health savings accounts (HSAs), traditional IRAs, and Roth IRAs.
Personal, student, and car loans for borrowers.

Learn more about Clearwater Credit Union.

Verity Credit Union – Washington state residents

Verity is active in the local microloan business — one project they’ve funded is the Business Impact Northwest loan program, which gives a financial boost to entrepreneurs in underserved communities.

As an environmentally conscious credit union, they’ve hopped on board the solar installation funding train as well, providing loans to homeowners installing solar panels.

Some especially helpful features include:

Open an account online or through their branch locations.
Accounts can be managed online.
IRAs and 401(k) rollovers are available.

Learn more about Verity Credit Union.

Virginia Community Capital (VCC) – Virginia residents

VCC is the community development arm of VCC Bank, a state bank that’s also a certified B Corp. Food access is a VCC funding priority, and they work with businesses providing healthy, local groceries across the state.

As a real estate funder, VCC has a Clean Energy Financing loan program for entrepreneurs taking on environmentally friendly construction projects.

Some helpful features include:

The Revolving Loan Fund fills financial gaps for investors who can’t afford commercial financing.
Personal savings accounts have low $25 opening deposit minimums.
Checking accounts, CDs, and Roth IRAs are available.

Learn more about VCC.

Central Bank of Kansas City – Missouri residents; online banking for all U.S. residents

15 Banks and Credit Unions Putting Social Responsibility First - Central Bank of Kansas City Based in Kansas City, Missouri, Central Bank of Kansas City focuses most of its efforts on the local economy. Their lending programs include New Market Tax Credits — incentives to invest in economically disadvantaged areas — and tax credits for developers building low-income housing.

Some exciting features are:

Checking, savings, and money market accounts have fully online options for non-local customers.
Personal accounts earn between 0.05% – 0.15% APY.
Brick-and-mortar banks for Missouri locals.

Learn more about the Central Bank of Kansas City.

Carver Federal Savings Bank – NYC, New England, and Mid-Atlantic residents

Carver Federal Savings Bank was founded in Harlem, NYC, and designed to strengthen Black communities, and the bank’s stayed true to this mission since 1948.

As a CDFI, they focus their donations on local initiatives, and they don’t invest in fossil fuels. Residents of eight states — CT, DE, MA, MD, NY, NJ, RI, and VA, as well as Washington, D.C., and Philadelphia, PA — can open accounts with Carver.

Their key features are:

Interest-bearing checking and savings accounts.
A mobile banking app makes Carver accounts easy to access online.
Account fees are waived with minimum monthly balances.

Learn more about Carver Federal Savings Bank.

First Green Bank – Florida residents

First Green Bank is a local leader in “green” investments. They fund commercial and residential projects that meet environmental standards, and community initiatives that support sustainable development in areas like water and agriculture. They have a loan plan specifically for homeowners who want to install solar panels.

Here are some exciting features:

Florida residents have checking and savings account options, including interest-bearing sustainable savings.
HSAs, IRAs, and youth savings accounts are available.

Learn more about First Green Bank.

Mascoma Bank – New Hampshire, Vermont, and Maine residents

Mascoma finances projects designed to revitalize low-income communities in Northern New England.

Local residents can take advantage of their suite of financial services, from the basic checking and savings accounts to mortgages and homeowner loans for solar or energy-efficient renovations.

Some key features include:

Three tiers of checking accounts are offered, and two earn interest.
Home equity loans and lines of credit, as well as traditional mortgages.
Emergency flood loans are available to cover storm-related damages.

Learn more about Mascoma Bank.

City First Bank – Washington, D.C. area residents

15 Banks and Credit Unions Putting Social Responsibility First - City First Bank For individuals, nonprofits, and other businesses in or near Washington, D.C., City First Bank is a CDFI worth checking out. They give 80% of their loan funds to projects in low-income communities, and they’ve financed thousands of affordable housing units in a city where the cost of living is rising quickly. City First has even branched out to finance nonprofits across the Mid-Atlantic.

Some top-of-the-line features include:

Personal checking and savings accounts have competitive interest rates.
Customers can make larger, FDIC-insured deposits through CDARS (Certificate of Deposit Registry Service) and money market accounts.

Learn more about City First Bank.

Beneficial State Bank – Oregon, Washington, and California residents

Beneficial State Bank funds renewable energy, affordable housing, and other community projects across the Pacific Northwest. Their nonprofit Beneficial State Foundation is a vocal public policy advocate for progressive change in the banking system.

As a lender, Beneficial uses a nontraditional underwriting model that considers factors other than credit scores. They’re also a trustworthy stop for auto loans if you’re a Pacific Northwest resident with subpar credit.

Here are some of their features:

Checking and savings accounts are fully mobile.
Money market accounts and IRAs are available.
California residents can finance an electric or hybrid vehicle at affordable rates through Beneficial’s Clean Vehicle Assistance program.

Learn more about Beneficial State Bank.

Why choose a socially responsible bank?

A bank or credit union account might seem like a convenience-based choice, not a values-based one. But when you entrust a bank with your money, you’re implicitly supporting the projects the bank funds.

You can make a difference

As a consumer, you have the power to make choices that sway banks’ overall priorities. Banks want your business, and if more customers opt for banks that support community development or environmental causes (or avoid fossil fuel funding that contributes to climate change), the industry will take note that people want socially responsible banking.

It is safer in their hands

Your money’s also in safe hands — just because these banks have a “people over profit” focus doesn’t mean they don’t make a profit.

Along with the standard FDIC insurance protection guarantees, socially responsible banks are just as profitable (if not more so) than their competition, according to research by the GABV.

What makes a bank socially responsible?

The primary barometers of social responsibility for banks are their lending and investment choices.

Read more: Ethical Banking: What You Should Know About Socially Responsible Banks

Charitable donations and community service

Many, if not most, banks advertise their charitable donations and community services, but they may still fund projects that contribute to climate change or displace low-income residents. If you go beyond a bank’s self-promotion materials to their lending practices, you’ll get a sense of the bank’s true priorities.

Transparency about their investment donation

Another indicator of responsibility is the bank’s transparency about their investment and donation choices — ethical banks take their accountability to the public seriously. And many socially responsible institutions are working for economic equity, with programs designed to help low-income residents or borrowers from underserved communities.

Public commitment to social good

Some large national and regional banks have received accolades for public commitments to the social good. The Ethisphere Institute, a think tank that examines corporate responsibility, has rewarded U.S. Bank on their list of the World’s Most Ethical Companies for seven straight years. Though awards from an outside organization don’t necessarily indicate a bank is truly making impactful, ethical choices, they can be a sign the institution is on the right track.

If you’re holding banks to the highest standard, however, you’ll look for certifications that indicate a deeper commitment. Every bank or credit union on this list is either a certified B Corp, a certified CDFI, or a member of the GABV.

Certified B Corporations

B Corporations have a legal obligation to meet certain requirements, including a diverse staff, a well-paid workforce, environmentally sustainable in-house practices, and more.

The B Corp certification needs to be renewed every two years and can be lost if the company changes its practices to focus more on profit than customers.

Global Alliance for Banking on Values (GABV)

The GABV is a small but impactful network of about 50 worldwide banks. Each bank has pledged to invest in its community, be transparent about its practices, and establish long-term client relationships.

Like B Corps, GABV members have to score well on a regular, detailed assessment of their ethical practices.

Community Development Financial Institutions (CDFIs)

CDFIs may be banks or credit unions, but they earn their U.S. Treasury CDFI certification by financing projects in low- or moderate-income or traditionally underserved communities. This may mean lending to nonprofits, supporting affordable housing, or offering mortgages to aspiring homeowners denied by other lenders.

How to find a socially responsible bank

This list is a start, but there are many, many more banks and credit unions on the local level that have socially responsible goals.

Mighty Deposits is a great site for finding out how banks are spending their money — just type in your bank(s) and/or credit union(s) and find out what percentage of the bank’s funds get invested in community projects.

Mighty Deposits includes detailed spending breakdowns in categories for each bank. You can also search for a bank that doesn’t fund fossil fuels, a CDFI, or a bank owned by Black Americans.

The independent site Better Banking Options is another way to find community-focused banks.

If you want to know more about a bank’s political donations, including any national and local candidates the bank supports, Open Secrets has data on most large banks (and several of the smaller ones, too).

Summary

If you’re thinking about a bank switch, consider a bank that’s dedicated to socially responsible causes. With the variety of checking, savings, and investment features these banks offer, you’re likely to find a spot that meets your needs.

Apache is functioning normally

May 14, 2023 by Brett Tams

Flexible spending accounts, or FSAs, are special savings accounts offered through some employer benefit plans. They allow the account holder to pay for certain out-of-pocket medical and dependent care costs with tax-free money.

However, FSAs come with some rules and regulations. For instance, FSA rules cap the amount of money that can be placed in the account each year ($3,050 for 2023), and also dictate which types of expenses qualify for an FSA distribution.

Still, FSAs can be a powerful tool for covering unavoidable medical costs that could otherwise wreak havoc on finances.

Flexible Spending Account Explained

FSAs are savings programs offered through employers — which means that self-employed people aren’t eligible. Those who are self-employed may be covered through an employed spouse’s plan, or they may choose to open an HSA, if they qualify.

FSAs are also sometimes called flexible spending arrangements, and they can cover you, your spouse, and your dependents. There are also a few sub-types of FSAs, such as dependent care FSAs (DCFSAs) and limited purpose FSAs (LPFSAs).

Recommended: Benefits of Health Savings Accounts

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Open a SoFi Checking and Savings Account and start earning 1% APY on your cash!

Flexible Spending Account Rules: An Overview

FSA contributions work similarly to employer-sponsored retirement plans like 401(k)s: a certain amount of wages is withheld each pay period and contributed to the account.

The account holder elects how much to withhold at the beginning of the plan year — and, importantly, they may not be able to change it unless there’s a change in employment or family status. That means it’s important to think the decision through carefully.

But unlike a 401(k), the funds placed into an FSA aren’t just tax-deferred — they’re actually tax-free. That means they aren’t included in the account holder’s total taxable income, nor are taxes due when distributions are made.

Recommended: Tax Credits vs. Tax Deductions: What’s the Difference?

How Much Can I Contribute to My FSA?

In 2023, account holders may contribute up to a maximum of $3,050 per year to their FSAs. Employers may also place limits on the amount an employee can elect to be contributed, up to this federal cap.

Unused Funds: FSA Rollover and Reimbursement Rules

Another rule regarding FSAs is the fact that, generally speaking, unused FSA funds are forfeited.

In other words, FSAs are “use it or lose it” accounts; the money that isn’t used for qualified expenses by the end of the plan year can’t be rolled over into the next.

Thus, account holders may want to be cautious to avoid over-contributing to the plan and carefully estimate how much they think they’ll need to spend on out-of-pocket health expenses. Setting up a budget may help with this.

However, there are some exceptions that may be accessible, depending on the employer’s policy choice. They may allow for a “grace period” or a carry-over option — one or the other, but not both, and they’re not legally required to offer either.

• The grace period option allows account holders to use their FSA funds for an additional two and a half months after the plan year to pay for qualified medical expenses.

• The carry-over option allows account holders to roll over up to $610 of unused funds into the account for use the next plan year, though the employer may specify a lower dollar figure. Carryover doesn’t affect the maximum allowable contribution for the next year’s plan.

Recommended: How to Negotiate Medical Bills

What Can a Flexible Spending Account Be Used For?

Given the contribution limits and forfeiture rules of flexible spending accounts, FSA account holders usually want to be careful about calculating how much money they might be able to use — otherwise, significant amounts of their paycheck might end up right back in their employers’ hands.

And although many medical expenses qualify, not all of them do, or especially rules apply. For instance, non-prescription medications are covered only with a doctor’s prescription. The exception is insulin, which is covered without a prescription.

FSA funds are also ineligible to be used for health insurance premiums (though you can use them for deductibles and copays) or long-term care coverage and expenses, which may affect those with chronic illnesses or disabilities.

There are, however, a wide range of procedures and healthcare services that FSA funds can be used to cover, including dental expenses.

In basic terms, any treatment that would qualify for a medical expense tax deduction can be covered by FSA funds; the full list of which can be found in IRS Publication 502 .

From acupuncture and alcoholism to birth control pills and psychological counseling, many services do count as qualified medical expenses.

Along with being the right kind of medical expense, services paid through FSA funds must be applied to the right people in order to be covered. Eligible beneficiaries include:

• The account holder

• Their spouse

• Dependents claimed on their tax return

• Children age 26 and under

Keep in mind, too, that FSAs generally work in conjunction with other types of health benefits and coverage, and funds can’t be used to reimburse services that are covered under other health plans.

It might be a valuable exercise to write out all of the expected medical expenses you’ll face as a family at the beginning of the plan year in order to decide how much to contribute, including additional coverages, in order to avoid over-contribution. While nobody can predict the future, some routine expenses can be foreseen — and a little bit of planning might save a lot of forfeited funds in the end.

Recommended: 15 Creative Ways to Save Money

Taking Distributions from an FSA

The process for taking distributions from an FSA may vary based on the plan. In some cases, distributions are made from an FSA to reimburse the account holder for medical expenses they’ve incurred. Some FSAs also have a debit, credit, or stored value card that can be used to pay directly for qualifying expenses.

In order to take a distribution, the account holder may have to provide a written statement from the doctor or medical service provider that specifies the medical expense incurred, as well as a statement documenting that the expense hasn’t been covered by any other health plan. In other situations, a receipt may be sufficient documentation in order to be reimbursed.

FSA reimbursements are only available for verifiable medical expenses that have already been incurred, rather than expenses the account holder plans to incur in the future. (In other words, you can’t write to the FSA and tell them you’re going to the doctor next month.)

Finally — and importantly — FSA participants must be able to use the entire benefit (that is, the total amount of money they pledged to contribute to the plan) even if those monies haven’t yet been contributed. There is some opportunity for roll-over, depending on the plan rules. Some FSAs allow account holders to carry over up to $610.

For example, if you decide to contribute $2,000, but get hurt midway through the year when only $1,000 has been deducted from your pay, you’ll still be able to use up to $2,000 worth of tax-free FSA coverage for qualified expenses. Pretty cool, huh?

Is a Flexible Spending Account Worth It?

A flexible spending account can be a helpful tool, but it’s not the only option for footing medical bills.

For one thing, $3,050 might not even scratch the surface of some common medical procedures, such as childbirth.

Furthermore, although the tax-free nature of FSAs is attractive, the prospect of forfeiting parts of a paycheck is definitely not — and there are other ways to save cash for medical expenses and other emergencies which offer not just flexibility, but growth.

For example, you could open an online bank account with a high-yield and earn more than 4% APY (annual percentage yield) in interest. That could be an option to explore.

Another idea is to create an emergency fund to help pay medical expenses. However, if you think you’ll use all the funds in an FSA, going that route instead may be worth more to you.

The Takeaway

The tax benefits of the FSA can make them an appealing and useful tool, especially for those who know they’ll spend a decent amount out of pocket on healthcare.

But if you’re not sure you’ll use the funds saved in an FSA, a SoFi Checking and Savings account could be an alternative solution. You’ll earn a competitive APY and you’ll pay no account fees. You could even use a SoFi Checking and Savings account as a complementary tool, along with your FSA, to work toward other saving goals.

Got medical expenses? Let SoFi Checking and Savings help you save for your healthcare needs.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2023 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.

The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

SoFi members with direct deposit can earn up to 4.20% annual percentage yield (APY) interest on Savings account balances (including Vaults) and up to 1.20% APY on Checking account balances. There is no minimum direct deposit amount required to qualify for these rates. Members without direct deposit will earn 1.20% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. These rates are current as of 4/25/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
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Source: sofi.com

Apache is functioning normally

May 13, 2023 by Brett Tams

Government officials can’t predict exactly when inflation will go down, but representatives of the International Monetary Fund expect the U.S. inflation rate to reach its 2 percent target by the end of 2023.

The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Law’s editorial disclosure for more information.

Consumers around the world are currently grappling with rising costs, making many people wonder how long this high rate of inflation is going to last. Although the U.S. inflation rate has nearly quadrupled since 2020, inflation is even worse in other countries. In Israel, for example, the inflation rate has increased by 25 times in the last two years.

When inflation is high, consumers have less purchasing power, making it more difficult to afford housing, food, utilities and other necessities. Some consumers have even changed their spending habits to account for rising costs. So, how long will inflation last? No one knows for sure, but it’s possible to make an educated guess based on what the Federal Reserve is currently doing to reduce spending.

What is inflation, and how does it work?

The Federal Reserve defines inflation as an increase in the overall price level of an economy’s products and services. This refers to a general increase in prices, not an increase in a single product or service category. For example, it’s possible for the cost of dairy products to increase without the rate of inflation increasing.

When inflation is high, many consumers have less purchasing power. This is because their income doesn’t buy as many products and services as it did when inflation was low. Inflation also has a negative impact on banks that loan money at fixed interest rates. If a bank makes a loan at 6 percent interest, an inflation rate of 7 percent would reduce its real income, or the amount of money it earns after taking inflation into account.

In the United States, the Consumer Price Index (CPI) helps estimate inflation by tracking the average change of prices over time. This index doesn’t include the price of every good or service. Instead, it uses a market basket of goods and services typically purchased by consumers in urban and metropolitan areas. In July 2022, the U.S. Bureau of Labor Statistics reported that the CPI rose by 1.3 percent in June, bringing the total increase for the last 12 months to 9.1 percent.

Why is inflation so high right now?

Although many Americans are feeling the pinch of higher prices, inflation is a global problem. In response to the COVID-19 pandemic, government officials around the world implemented mandatory lockdowns to prevent the spread of the disease. With so many businesses closed, the demand for goods and services declined.

Once businesses started reopening, demand soared. With the unemployment rate falling to 3.5 percent in July 2022, job seekers have more bargaining power, driving up wages and giving many consumers more money to spend on goods and services. Consumers also saved more money than usual in 2021 due to concerns over how the ongoing pandemic would affect their finances.

Although demand has increased, many companies are unable to fill orders due to manufacturing and shipping backlogs associated with the pandemic. When demand exceeds supply, firms increase their prices, contributing to higher rates of inflation.

Finally, many consumers are spending more on services than goods, increasing demand in the service sector. As a result, it now costs more to rent an apartment, dine at a restaurant or hire someone to perform housekeeping or landscaping services.

The government’s response to inflation

The Federal Reserve is currently implementing contractionary monetary policy to reduce demand and give the economy a chance to cool off. This involves raising interest rates to decrease consumer spending and business-related investment spending.

The Biden-Harris administration is also focused on lowering costs for low-income and middle-class families. President Biden signed the Inflation Reduction Act of 2022 into law on August 16, 2022, and this act aims to reduce energy costs and make healthcare more affordable for Americans.

Because the current inflation rate is associated with high levels of demand, there isn’t much more the federal government can do to bring prices down. The plan is to continue raising rates until the inflation rate returns to 2 percent.

When will inflation go down?

Government officials can’t predict exactly when inflation will go down, but representatives of the International Monetary Fund expect the U.S. inflation rate to reach its 2 percent target by the end of 2023. To reach this target, analysts believe the Federal Reserve will need to raise rates by another 2 to 2.5 percent before then.

Are we in a recession?

Although government officials, consumers and business owners are concerned about the prospect of a recession, the United States hasn’t entered a true recession yet. A recession is characterized by rising levels of unemployment, lower retail sales and negative growth of the gross domestic product (GDP), among other factors.

In July 2022, the Bureau of Economic Analysis reported that the U.S. GDP declined by 1.6 percent in the first quarter of the year and 0.9 percent in the second quarter. Although GDP declined, retail sales increased by 1 percent between May and June 2022. The unemployment rate also fell from 5.4 percent in July 2021 to 3.5 percent in 2022. Therefore, the United States doesn’t yet meet all the criteria for an economic recession.

Where is inflation the worst in the United States?

In the United States, cities tend to have higher inflation rates than suburbs and rural areas, due in part to their higher housing costs. On July 13, 2022, Bloomberg reported that several American cities had crossed the 10 percent mark. Urban Alaska is at 12.4 percent, the Phoenix-Mesa-Scottsdale metro area in Arizona is at 12.3 percent and the Atlanta-Sandy Springs-Roswell metro area in Georgia is at 11.5 percent. Baltimore, Seattle, Houston and Miami also have inflation rates above 10 percent.

Inflation isn’t quite as bad in the New York-Newark-Jersey City metropolitan area, which had a 6.7 percent inflation rate in June 2022. Overall, inflation tends to be higher in the South and Midwest regions than it is in the Northeast region of the United States.

How will inflation affect my 2022 and 2023 taxes?

Take a look at the top ways your upcoming taxes might be affected by inflation.

Taxable income

Federal tax brackets are adjusted for inflation, which means you may drop to a lower tax bracket in 2022 even if your income doesn’t decrease. If high rates of inflation persist, you may get the same tax benefit when you file your 2023 return.

The standard deduction is also adjusted for inflation, so high inflation rates may help you reduce your taxable income even more than in previous years. In 2021, the standard deduction for a single filer was $12,550; for the 2022 tax year, it’s $12,950. If the economy doesn’t cool down quickly, the standard deduction may be even higher in 2023.

Health savings accounts

The annual HSA contribution limit is adjusted for inflation, so high rates of inflation allow you to put aside more money for medical expenses each year. The limits have already been increased for 2022, allowing individuals to contribute $3,650 per year and families to contribute $7,300 per year. In 2023, the limits will increase even more, to $3,850 for individuals and $7,750 for families.

HSA contributions are deducted on a pre-tax basis, so higher contribution limits may leave you with less taxable income, reducing your tax burden.

Retirement contributions

High levels of inflation can even help you save a little more money for your retirement. The contribution limits for 401(k) accounts and individual retirement arrangements (IRAs) are adjusted for inflation, so you can typically save more when inflation is high. For 2022, the 401(k) contribution limit is $20,500, an increase from the $19,500 limit for 2021. The IRA contribution limit didn’t increase for 2022, but it may go up in 2023 if the inflation rate continues to be high.

Although you can’t save more in your IRA this year, the income limit for 2022 was increased to keep up with inflation. As a result, you can now participate in a Roth IRA if your income doesn’t exceed $144,000 ($214,000 for married couples filing jointly).

If you have combined income of more than $25,000 in a year as a single filer, your Social Security benefits are subject to federal income taxes; the limit increases to $32,000 for married couples filing jointly. Combined income includes half your Social Security benefits, your adjusted gross income and your tax-exempt interest income. These income limits aren’t adjusted for inflation, but Social Security benefits are.

For 2022, the federal government implemented a 5.9 percent cost-of-living increase for Social Security beneficiaries, and the 2023 adjustment could be as high as 10 percent, or even slightly more—we’ll know for sure in October 2022. This increase could push your combined income above the $25,000/$32,000 limit, making your Social Security benefits taxable for the first time.

Capital gains taxes

When you sell certain assets, you must pay capital gains tax on your profit. If you sell when inflation is high, you could end up with a profit on paper even if the sale results in a real loss. This typically happens when high rates of inflation erode your purchasing power over time.

If you made a $100,000 investment in 1980 and sold it for $200,000 today, it would look like you made a profit of $100,000. The truth is that $100,000 in 1980 dollars is equivalent to about $359,600 today. Although you made a profit on paper, you really lost a significant amount of purchasing power. Unless you qualified for some type of exemption, you’d have to pay capital gains tax since the purchase price of assets isn’t adjusted for inflation.

How can I save money while inflation is high?

You can’t control the national economy, but there are a few things you can do to strengthen your financial position while inflation is high.

Eat more meatless meals. Meat, poultry and eggs are among the food products with the highest price increases in 2022. To lessen the effects of rising costs on your budget, try adding a few meatless meals to your weekly menu.
Track your spending. If you don’t keep track of your spending, it’s easy to spend much more than you realize. Keep a record of how much you spend on necessities as well as extras like streaming subscriptions and movie tickets.
Start meal planning. If you spot a good deal at the grocery store, you can take advantage by planning several meals around that ingredient. For example, if a store is advertising chicken for $2.49 per pound, you may want to plan on eating chicken salad sandwiches for lunch each day that week.
Cancel unused subscriptions: In June 2022, Sarah O’Brien of CNBC reported that more than 40 percent of consumers were paying for at least one subscription they didn’t use. Unused subscriptions leave you with less money in your pocket, so canceling them can help you weather this period of high inflation.
Maintain a high credit score. When you have good credit, you typically qualify for lower interest rates and other favorable loan terms. If you have to borrow money while inflation is high, maintaining a healthy score can help you save money.

Keep the faith

Inflation makes it a little tougher to meet your financial goals, but that doesn’t mean you should give up on managing your finances responsibly. You can save money by tracking your spending, canceling unused subscriptions and planning your meals according to what foods are on sale each week.

Maintaining good credit can help you save money in the long run if you have to take out a loan or otherwise buy on credit. If your credit is lower than you’d like it to be, work with the credit repair consultants at Lexington Law to identify inaccurate negative items on your credit reports and make sure outdated information isn’t being held against you.

Note: Articles have only been reviewed by the indicated attorney, not written by them. The information provided on this website does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client or fiduciary relationship between the reader, user, or browser and website owner, authors, reviewers, contributors, contributing firms, or their respective agents or employers.

Reviewed By

Brittany Sifontes

Attorney

Prior to joining Lexington, Brittany practiced a mix of criminal law and family law.

Brittany began her legal career at the Maricopa County Public Defender’s Office, and then moved into private practice. Brittany represented clients with charges ranging from drug sales, to sexual related offenses, to homicides. Brittany appeared in several hundred criminal court hearings, including felony and misdemeanor trials, evidentiary hearings, and pretrial hearings. In addition to criminal cases, Brittany also represented persons and families in a variety of family court matters including dissolution of marriage, legal separation, child support, paternity, parenting time, legal decision-making (formerly “custody”), spousal maintenance, modifications and enforcement of existing orders, relocation, and orders of protection. As a result, Brittany has extensive courtroom experience. Brittany attended the University of Colorado at Boulder for her undergraduate degree and attended Arizona Summit Law School for her law degree. At Arizona Summit Law school, Brittany graduated Summa Cum Laude and ranked 11th in her graduating class.

Source: lexingtonlaw.com

Apache is functioning normally

April 27, 2023 by Brett Tams

Saving money is a crucial aspect of personal finance. Understanding the different types of savings accounts and selecting the right one for your needs can help you grow your money and achieve your financial goals.

In this article, we’ll explore various types of savings accounts, including traditional savings accounts, money market accounts, certificates of deposit (CDs), high-yield savings accounts, cash-management accounts, and specialty savings accounts.

6 Types of Savings Accounts

Here are the six primary types of savings accounts, each designed to meet varying financial needs and goals.

1. Traditional Savings Accounts

Traditional savings accounts are a popular choice for those looking to start saving money. They are typically offered by traditional banks and credit unions and are insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA).

Key Features

Low minimum deposit requirements
Limited transactions per month
Modest interest rates

Pros and Cons

Traditional savings accounts are easy to open and maintain, making them an ideal choice for beginners. They offer a secure place to store your money, with the backing of federal deposit insurance. However, the interest rates on these accounts are typically lower than other types of savings accounts.

Ideal for: Emergency Funds and Short-Term Savings Goals

A traditional savings account is a great place to start building your emergency fund or saving for short-term goals, such as a down payment on a car or a vacation. They provide a safe place to store your money while earning modest interest.

See also: Best savings accounts for 2023

2. High-Yield Savings Accounts

High-yield savings accounts offer higher interest rates than traditional savings accounts, making them an attractive option for savers looking to maximize their interest earnings.

Key Features

Higher interest rates than traditional savings accounts
Online and mobile access
Minimal fees

Pros and Cons

High-yield savings accounts offer competitive interest rates, often higher than those found at traditional banks. They typically come with low or no monthly fees and provide easy online and mobile access. However, these accounts may have limited branch locations, making it difficult for some users to visit a physical location.

Ideal for: Maximizing Interest Earnings While Maintaining Liquidity

A high-yield savings account is an excellent choice for those looking to earn a higher return on their savings while still maintaining easy access to their funds.

See also: Best high-yield savings accounts for 2023

3. Money Market Accounts

Money market accounts are a type of savings account that typically offer higher interest rates than traditional savings accounts. They are offered by banks, credit unions, and non-bank financial institutions.

Key Features

Higher interest rates compared to traditional savings accounts
Limited check-writing and debit card privileges
Minimum balance requirements

Pros and Cons

Money market accounts offer higher interest rates than traditional savings accounts, making them an attractive option for those looking to earn more on their savings. They also provide some liquidity with limited check-writing and debit card access. However, these accounts typically require a higher minimum balance to maintain, and there may be monthly fees if the balance falls below a certain threshold.

Ideal for: Those Seeking Higher Returns with Some Liquidity

If you’re looking for a savings account that offers higher interest rates than a traditional savings account, but still provides some access to your money, a money market account may be the right choice for you.

See also: Best money market accounts for 2023

4. Certificates of Deposit (CDs)

Certificates of deposit (CDs) are time-based deposit accounts that offer fixed interest rates for a specified term. They are offered by banks, credit unions, and other financial institutions.

Key Features

Fixed interest rates for a specified term
Early withdrawal penalties
Various term lengths

Pros and Cons

CDs offer higher interest rates than traditional savings accounts and money market accounts. They are a low-risk investment option, making them ideal for long-term savings goals. However, CDs require you to lock your money away for a set period, and early withdrawal penalties may apply if you need to access your funds before the term ends.

Ideal for: Low-Risk Investments and Long-Term Savings Goals

If you have a long-term savings goal or are looking for a low-risk investment, a CD may be the right choice for you.

5. Cash-Management Accounts

Cash-management accounts are a hybrid of checking and savings accounts, offering the benefits of both types of accounts in one convenient package.

Key Features

High-interest rates
No minimum balance requirements
Flexible access to funds, including check-writing and debit card privileges

Pros and Cons

Cash-management accounts offer high-interest rates and the flexibility of a checking account, making them an appealing option for those who want the best of both worlds. However, these accounts are typically offered by online banks and non-bank financial institutions, so access to brick-and-mortar branches may be limited.

Ideal for: Those Seeking Flexibility, Convenience, and High Returns

A cash-management account is perfect for individuals who want a high-interest savings account combined with the convenience of a checking account.

6. Specialty Savings Accounts

Specialty savings accounts are tailored to help individuals save for specific financial goals. These accounts often come with unique features, benefits, and tax advantages. Let’s take a closer look at three common types of specialty savings accounts.

Health Savings Accounts (HSAs)

Health Savings Accounts (HSAs) are designed to help individuals save for qualified medical expenses on a tax-advantaged basis. They are available to those who are enrolled in a high deductible health plan (HDHP).

Key Features

Tax-deductible contributions
Tax-free withdrawals for qualified medical expenses
Funds can be invested, and investment earnings are tax-free
Unused funds roll over from year to year

Pros and Cons

HSAs offer significant tax advantages, allowing you to save and invest money for healthcare expenses without paying taxes on contributions, earnings, or withdrawals for qualified expenses. However, HSAs are only available to those enrolled in an HDHP, and there are annual contribution limits. Additionally, using HSA funds for non-qualified expenses can result in taxes and penalties.

Ideal for: Saving for Healthcare Expenses with Tax Advantages

If you have a high deductible health plan and want to save for future medical expenses while enjoying tax benefits, an HSA may be the right choice for you.

Education Savings Accounts (ESAs)

Education Savings Accounts (ESAs) are designed to help families save for education expenses, such as tuition, books, and other related costs. The two main types of ESAs are the Coverdell Education Savings Account and the 529 Savings Plan.

Key Features

Tax-free withdrawals for qualified education expenses
Wide range of investment options
Contribution limits and eligibility requirements may apply

Pros and Cons

ESAs offer tax advantages, allowing you to grow your savings tax-free and make withdrawals for qualified education expenses without paying taxes. However, there are contribution limits, and eligibility requirements may apply. Additionally, using ESA funds for non-qualified expenses can result in taxes and penalties.

Ideal for: Saving for Education Expenses with Tax Advantages

If you’re planning to save for future education costs, such as college tuition or private K-12 schooling, an ESA may be the right choice for you.

Individual Development Accounts (IDAs)

Individual Development Accounts (IDAs) are designed to help low-income individuals save for specific financial goals, such as purchasing a home, starting a business, or paying for higher education.

Key Features

Matching funds provided by non-profit organizations or government agencies
Financial education and counseling services
Eligibility requirements based on income and other factors

Pros and Cons

IDAs offer the unique benefit of matching funds, which can significantly boost your savings. They also provide financial education and counseling services to help you achieve your financial goals. However, IDAs have strict eligibility requirements based on income, and there may be restrictions on how the funds can be used.

Ideal for: Low-Income Individuals Saving for Specific Financial Goals with Matching Funds

If you meet the eligibility requirements and have a specific financial goal in mind, an IDA can be a valuable tool to help you save and achieve your objectives with the support of matching funds and financial education services.

How to Choose the Right Savings Account for You

Selecting the right savings account is an important step in achieving your financial goals. To make the best decision, consider the following factors and follow these steps to guide you through the process:

Step 1: Assess Your Financial Goals and Priorities

Before choosing a savings account, it’s crucial to understand your financial objectives. Consider your short-term and long-term goals, such as:

Building an emergency fund
Saving for a down payment on a house or car
Planning for retirement
Funding a child’s education
Saving for a vacation or other significant purchase

Understanding your goals will help you determine the type of savings account that best aligns with your priorities and financial timeline.

Step 2: Compare Interest Rates, Fees, and Account Features

Once you’ve identified your financial goals, start comparing interest rates, fees, and account features across different savings account options. Factors to consider include:

Annual percentage yield (APY): The APY represents the interest rate you’ll earn on your savings over a year, taking into account compounding. A higher APY will result in greater interest earnings.
Fees: Be aware of any monthly maintenance fees, ATM withdrawal fees, excess transaction fees, or other charges that may apply to the account. Look for accounts with low or no fees to maximize your savings.
Account features: Evaluate the account’s accessibility, such as online and mobile banking capabilities, branch locations, and customer service. Consider any unique features or benefits, such as rewards programs or cash-back offers.

See also: Best 5% Interest Savings Accounts of 2023

Step 3: Consider the Accessibility and Customer Service of the Financial Institution

When choosing a savings account, it’s essential to evaluate the financial institution’s accessibility and customer service. Factors to consider include:

Branch locations and hours: If you prefer in-person banking, opt for a financial institution with convenient branch locations and hours.
Online and mobile banking: Ensure the financial institution offers robust online and mobile banking services, allowing you to manage your account, transfer funds, and check your balance with ease.
Customer service: Assess the quality of customer service, including responsiveness, availability, and knowledge of the institution’s representatives.

Step 4: Diversify Your Savings Strategy to Take Advantage of Different Account Types

Diversifying your savings strategy by utilizing different types of savings accounts can help you maximize your interest earnings, meet various financial goals, and manage risks. Consider opening multiple accounts, such as:

A high-yield savings account for your emergency fund or long-term savings goals
A money market account for short-term goals or to maintain liquidity
A certificate of deposit (CD) for low-risk, long-term investments
Specialty savings accounts, such as a Health Savings Account (HSA) or an Education Savings Account (ESA), to save for specific financial goals with tax advantages

Bottom Line

Understanding the various types of savings accounts can help you make an informed decision about where to store your money and how to grow your savings. By choosing the right account for your needs, you can maximize your interest earnings, maintain liquidity, and achieve your financial goals. Start saving and growing your money today!

Source: crediful.com