NEW YORK (3/31/11)--A column in a popular MSNBC
blog chronicled the demise of free checking services at banks, noted that banks' ATM fees are soaring, and suggested that "there's no reason not to open a credit union account." The column struck a chord with readers and generated 542 comments, with many readers extolling the virtues of credit unions. Bob Sullivan's "The Red Tape Chronicles" blog (March 29) discussed several traps banks are setting to generate fees they would lose in the debit interchange reform. He adds them up and estimates that five trends could cost a consumer $253 annually. The five trends:
* ATM fees are soaring to $5, $6 and $7 per withdrawal; * Consumers are running afoul of "movable" minimum balances that result in fees; * Banks are tricking consumers into opting into services consumers don't need (he named overdraft protection as an example); * Name changes in banks mean an acquisition--and new fees and restrictions; and * Minimum requirements on accounts mean parking money where it doesn't earn as much as an account with higher interest.
The point of the column, Sullivan said, is to get consumers to consider banking alternatives. "Credit unions and small banks still offer really free checking. In fact, BankRate.com just released a survey showing 38 of the 50 largest credit unions have free checking with no strings attached, and about half of them don't even require a minimum balance. Their ATM fees are, on average, half of traditional bank fees and one-quarter of the large credit unions charge no ATM fees at all. "That means there's no reason not to open a credit union account, even if it merely serves as a secondary checking account," Sullivan concluded. Several readers swore they would take their money out of their bank and put it into a credit union. Others commented that they had already switched to credit unions and were happy about the switch. "Best decision I ever made," said one reader. Credit unions are "the last of decent banking," shouted another in all capital letters. "Love love love my credit union!" was a third. Other readers told about the credit union difference and credit unions structure and why credit unions have tax-exempt status. Use the link to read the full blog and the 542 comments from readers.