For a 40-minute freebie financial documentary, Spent: Looking for Change sure got a lot of publicity. And really, I’m not sure why. Was it directed or bankrolled by someone I should know? (I’m not a film aficionado, in case you hadn’t noticed.)

    Spent: Looking for Change (Movie)

    I’ve watched Spent twice now, and found it to be a well-done film. Definitely worth viewing if you’re a money-dork like me. If you’re coming to it looking for answers to tough financial issues — yours, or our country’s — you’ll get none.

    What’s the Message?

    What does Spent: Looking for Change try to convey? Well, mostly, that there’s a huge segment of our country’s population which is “underserved” by Greedy Nasty Corporate Taxpayer-Backed Profit Machines, also known as banks.

    I’m sure lots of readers have taken me for a banking apologist over the years — check out my blast on overdraft whiners, for example. But the fact is that I have little sympathy either for banks OR for the people they regularly fleece. Am I a cold, heartless bastard? Yes, quite possibly. But one thing I know is this:

    The financial system in the U.S. isn’t set up to allow for people who either (1) make repeated poor decisions, or (2) hit a Big Misfortune in life (think major illness of a family’s breadwinner) to easily recover from those situations. If nothing else, Spent: Looking for Change makes that fact crystal-clear.

    But there’s another message I picked up from Spent, and I’m wondering if it’s what was intended. That message was:

    Everyone needs, and should be provided, the ability to borrow at low cost.

    Oh, how I vehemently disagree with this message. Every “victim” in the film eventually turned to debt as a “solution,” for whatever reason, and every one of them found that the debt they “needed” was either unavailable or came at a high cost.

    Okay. So where’s the problem?

    If you want to borrow money, and the bank pegs you as “high risk,” then high risk equals high cost. Period. That is basic economics. That is life. The earlier we learn that, the better. And if you as the director/producer/funding agent of this film believe that the “high risk equals high cost” precept is wrong or unfair, then I invite you to throw copious amounts of your own hard-earned money into the pile from which high-risk and/or low-income customers can borrow at rock-bottom interest rates.

    Let me know how it turns out, if you don’t mind.

    So I’m a Meanie.

    Would I prefer that the single mom from Texas, who lost her only means of transportation to a title-loan company, have found another way to come up with the funds she needed? Definitely I would. Would I have been willing to loan her that money myself, at low rates? No. Should someone else be forced to do so? No.

    Would I prefer that the young female entrepreneur in the film, who apparently cannot make leather bags fast enough to keep her customers’ orders filled, be able to manageably kick her business into the next gear? Yes, I would … in my heart. But in my head, I wouldn’t loan her the money to do it, nor would I ask anyone else to do so, because the $100k of student-loan debt she took out will always be first at the table when push comes to shove. (Those student loans appear to have been be a TERRIBLE HORRIBLE LIFE-CRUSHING decision here, by the way. But the film says little about this. Nor does it mention the fact that the “huge student-loan problem” we have is because WE HAVE SPENT DECADES HANDING OUT EASY-TO-GET LOANS IN THIS VERY ARENA.)

    Like so many things in life, there aren’t any easy answers here. But I am quite positive that “Let’s make debt more available!” isn’t any kind of an answer, easy or not.



  2. Capital One 360 and P2P Payments

    Many moons ago, I penned a personal review of the Capital One 360 Checking Account. Actually, I’d opened the account when it was still managed by ING Direct, but then Capital One came along and bought ING Direct’s U.S. assets, and so one of my most beloved bank accounts fell into the hands of a Nearly Too Big To Fail bank … and one for which I’ve never really cared all that much.

    I still have my Capital One 360 accounts (savings and checking), and I use them more than any other non-credit-card accounts I have, save one. To date, Capital One has given me no reason to look elsewhere for similar, online-only accounts.

    However, an email from reader “K” hit my inbox yesterday which other readers might find interesting:


    I just finished reading your review of your Capital One 360 account. Although I’m sure it’s wonderful for the account holder, there’s a little problem with outside account holders.

    I have an issue with all the online “toys” my husband insists on signing up for, mainly because I’m getting very much aware of how much “ME” is out there and available, and I’m trying to avoid volunteering more information if I can.

    Enter “Person2Person” transfers! Hubby owed me some money; nothing major, but since we’re in the same household, mere feet from one another, I kinda would have preferred he just cut me a check. “I just wanna try it.” Okay, fine, ignore my request and play with your internet crappola, because “…they only need the last 4 digits.” Yea, okay.

    So you already know how THAT went; they need the whole account number and routing number, I’d rather they did NOT have access to my checking account, but since he already used that one, that’s the one I have to give them. Fine. I tell him, he apologizes, whatever honey, they already have my information now, thanks.

    Oh, but it gets better, and here’s the part I’m guessing you were unaware of — the credit inquiry! A day or two after the transfer just happened to be the day I receive my monthly credit update from Experian. It shows me any changes in the last month, such as negative information, new accounts, closed account … and credit inquiries! There was one new inquiry: Capital One.

    I am anxiously awaiting their reply of my angry Nasty-Gram. I did NOT ask them for a line of credit, I did NOT open an account with them, and there were more than sufficient funds in my husband’s account. They had NO BUSINESS sticking their noses into MY credit rating! Pretty much everyone is aware that, of all the things that can lower your credit score, top of the list is “Credit Inquiries,” not so much as how MUCH it dings your score as the fact that it can happen a LOT and most people were unaware for a very long time. I am VERY aware, and they did NOT have authorization to do so by me.

    Just thought you’d appreciate the additional information. Thanks for listening to my rant.

    — K.

    Now, for my part, I’ve used the Person-2-Person transfers mentioned by “K” precisely one time, and that was a test transfer to my wife (whose account info ING Direct/Capital One already had). So if slinging out credit inquiries is a matter of course for Capital One in these transactions, they’d have had no reason to do it in my case.

    If this is what they do for new not-really-a-customer customers, well, it fairly sucks. I haven’t utilized the P2P transfer feature for anything more than a test, and won’t be doing so now, either.

    UPDATE: It Wasn’t a Capital One Inquiry.

    Turns out that upon closer inspection, the credit inquiry which K. saw on her report was from HSBC, not Capital One. The fellow from Capital One who’d responded to K.’s “Nasty Gram” had told her as much — that Capital One did not perform credit inquiries on the accounts related to P2P transfers.

    When K. traced the phone number associated with the inquiry, it pointed to HSBC. Their inquiry (for an unrelated card) just happened to coincide with the timing of the P2P transfer at the center of this here blog post.

    So Capital One 360 customers and P2P transfer users can rest easy. No willy-nilly credit inquiries here!



  3. Bank Account Blacklist

    Fun little article over at the New York Times:

    Dealbook: Many Denied Bank Accounts for Past Errors

    Just when you thought that $40 overdraft fee couldn’t be any more out-of-line, well, your friendly neighborhood Too Big To Fail bank went and added you to a “Bad customer!” database, too. Or more specifically, a blacklist. Now you can’t get another bank account for years. At any bank.

    Ah, well. Your mattress is probably safer anyway.



  4. Surprise: TBTF Banks Will Screw You

    Way back in 2007, I penned a post in which I voiced my displeasure with folks who whine about overdraft fees. In the comments, I was called lots of names … “bank apologist” among the nicest of these.

    Thanks to the fine, upstanding management team at Bank of America, I now have the opportunity to make something crystal clear: The Too Big To Fail Banks (TBTF) banks will screw you any chance they get. This is not a new opinion for me; I’ve felt this way since long before I started this here money blog. I’m just reiterating it here, for those who aren’t paying attention.

    I absolutely felt this way when I wrote the overdraft-whiners post, too. The way I see it, the fact that these banks will hose you at every opportunity is a given. Thus, we as consumers and bank-users must do everything we can to NOT give them that opportunity. That includes knowing how much is in your checking account at any given time, and not executing transactions above that amount, and not giving the bank any reason at all to slap you with a $50 service fee. If you DO give the bank a reason to FeeSmack™ you, then don’t whine about it.

    It’s plain as day: The TBTF banks are in charge. Our government and our economic system require this, because debt is money, and debt underpins EVERYTHING. TBTF banks hold, service, issue, and securitize debt in enormous amounts, so they make the rules. You and I simply have to play by those rules.

    Now allow me, if you will, the opportunity to show just how far TBTF banks (Bank of America, in this case) will go to (1) bend their customers over a counter, and (2) make a buck:

    JDSupra Law News: BOA Senior Admits to Being Told to Lie

    If you have dealings not only with Bank of America, but with pretty much any bank that’s “regional or larger” in size, you really should take a moment to read the article. I’d say that Simone Gordan’s affidavit is a staggering admission, but really, it isn’t. Of course BOA reps were told to lie to customers. BOA was woefully unprepared for the various mortgage- and loan-modification programs which U.S. FedGov thrust upon them, and besides, by lying to customers, there was cash to be made.

    From the affidavit, as stated by Bank of America senior loan collector Gordan:

    Using the Bank of America computer systems I saw that hundreds of customers had made their required trial payments, sent the documents requested of them, but had not received permanent modifications. I also saw records showing that Bank of America employees have told people that documents had not been received when, in fact, the computer system showed that Bank of America had received the documents. This was consistent with the instructions my colleagues and I were given. We were told to lie to customers and claim that Bank of America had not received documents it had requested, and that it had not received trial payments (when in fact it had). We were told that admitting that the bank received documents would “open a can of worms” since the bank was required to underwrite a loan modification within 30 days of receiving those documents and it did not have sufficient underwriting staff to complete the underwriting in that time…. Site leaders regularly told us that the more we delayed the HAMP modification process, the more fees Bank of America would collect.

    Nice, huh? If you or I tried crap like this in our business dealings, we’d go to jail. But a TBTF bank does it, and they get paid.

    Are we clear on how this works yet?

    You must carry on your financial lives as if you are, well, prey.

    Because with TBTF banks, that is absolutely what you are.



  5. Debit Card Drawbacks

    I’ve mentioned it numerous times on IYM: Debit cards are a great tool, but they have serious drawbacks, too. And there are some things for which they’re totally unacceptable.

    Cue the piece from USA Today:

    USA Today: Debit Card Holds Can Derail Travel Plans

    Dave Ramsey loves to talk up debit cards, but as the article tells us, there are times (vacations, for one) when you really ought to keep that particular slab of account-zapping plastic tucked in your pocket.

    What makes debit cards even worse? Well, as my daily dealings with Joe Q. Public have taught me, there are still a great many folks who have no idea how debit-card daily limits and hold policies actually work. (Though, to be fair, most people also have no idea how their credit-card policies work, either, so why would it be any different for debit cards?)



  6. ING Direct Adds Remote Check Deposit

    NOTE: In 2012, Capital One purchased ING Direct and its assets. At that time, all ING Direct “Electric Orange” checking accounts became part of Capital One 360. Please see my Capital One 360 Checking review for more details, and, of course, my updated review.

    The account formerly known as “ING Direct Electric Orange Checking” is now “Capital One 360 Checking.”

    Well, sometime in April, ING Direct went and added the ability for us Orange-heads to deposit paper checks by scanning and uploading check images via smartphone or PC.

    Hmph. And here I was, wondering whether I even wanted to keep our ING Direct accounts open. Kinda tells you how much attention I’ve been giving them lately, doesn’t it?

    Scan a Paper Check; Deposit a Paper Check

    I’ve been waiting a long while for this feature, honestly. ING Direct will be the first bank or credit union with which I’m associated to offer this service. (No surprise there, I guess.)

    Locally, I’ve seen billboards from other banks offering this sort of thing. Being a guy who tries to avoid bank tellers and ATMs as much as I can, I was pretty intrigued at the idea of depositing paper checks simply by snapping a pic of the check (front and back) and sending it to the bank. Well, that day is here. And I, for one, am pretty darn excited about it.

    Less trips to the ATM for me! Yay! (And less need for me to have to transfer money from any of our other banks into our Electric Orange checking, too.)

    First Check Deposit Is a Go!

    I don’t know what you guys were doing this past Sunday night, but *I* was giving ING’s new feature a try. (You can tell I’m a full-fledged money-and-tech dork, because things like this actually make me giddy.)

    With a new $100 paper check — fresh from one of our rewards credit cards — in my hands, I quickly read through ING’s online tips for successfully depositing paper checks, and then fired up our home PC and scanner. I put the check face-down on the tray, placed a piece of dark construction paper behind it (ING says this creates contrast and allows their system to more easily identify the check information) and made a 300dpi JPEG scan. I then did the same with the signed back of the check.

    A quick upload of both images to ING, and that was it.

    Within minutes, my email inbox held a message from ING Direct, telling me that I’d successfully submitted the check. The next morning (Monday), another email informed me that the check had been successfully deposited into my account, and that I was now free to void the check.

    Wow. That was easy.

    Color me orange-ly happy. Once again, ING Direct has made me remember why I like them so much — and why I’m praying that leadership at Capital One doesn’t screw up the great, great thing that ING has going.



  7. Will I Stay With ING Capital Direct One?

    I’ve not made mention of Capital One’s purchase of ING Direct USA yet in this blog, mostly because I figured every other money blogger out there had probably handled my bitching for me.

    My suspicions were largely affirmed when I read this dispatch from Ad Age:

    AdAge: Can CapOne Persuade ING Customers to Stay?

    I disliked — nay, despised — the idea of my beloved ING Direct accounts falling under the stead of Capital One. Apparently, I wasn’t the only one:

    Reactions to the $9.2 billion acquisition, which closed in mid-February, on social-media sites like Twitter from ING Direct customers were mostly negative, with many announcing they had already left ING Direct or were looking for alternatives.

    What do I have against Capital One? Nothing tangible, really. They’ve not shafted me in the past on credit-card rates or anything. But, to be fair, it isn’t like I’ve done a TARP-load of business with them, either. Ahem.

    Where Do We Go From Here?

    I don’t know why, really, but even though my Electric Orange checking account screen still says ING Direct, just logging-in now feels … I dunno … dirty.

    ING Direct’s Orange Savings account was my first banking love, as it was for so many online savers. The idea of online-only savings and checking accounts never occurred to me until another blogger introduced me to ING Direct, and what I saw, I liked, right off the bat. ING Direct was different. They didn’t throw credit-card offers in my face every twelve minutes; they actually paid above-market rates on savings; they didn’t barrage me with ads for Christmas loans and nothing-down mortgages. (I suppose it should’ve been obvious, even then, that they were short-termers.)

    All those positives will, I suspect, disappear in time, now that ownership has been, uh, reconfigured. Cap One will no doubt do everything it can to monetize those ING accounts. This hasn’t happened yet, of course, but just thinking about it saddens me. I really, really liked ING Direct.

    When ING Direct came along, I actually thought maybe savers (read: tightwads) and banks could get along together okay — maybe even have something sort of “cool” going on, with any luck — but, as so often happens, reality has now set in. Savers don’t make money for banks; borrowers do. And so Capital One will plunge ahead with turning what’s left of ING’s savers into Capital One’s borrowers. Or, failing that, at least turn them into fee-payers.

    We all know it’s coming.



  8. So Why Save?

    Talk about fantastic news: My email inbox showered me with a couple of interest-rate notices this past week … the same sort of notices that have been so pervasive for the last several years:

    Dear Affiliate,

    ING DIRECT’s Orange Savings Account and Kids Savings Account rate has changed to 0.80%.

    ING DIRECT’s Business Savings Account rate has changed to 0.50%.

    Electric Orange Checking Account rates have changed…

    While ING’s savings rates have been below 1% for a while now, and consistently dropping to new lows (for them), the update that really smarted came courtesy of my preferred credit union. Their rewards checking account had been paying me 4.38% ever since I’d signed up back in August of 2010. The new rate as of January 1, 2012?

    Try 3.38%.

    While that’s still a pretty nice rate, relatively speaking, that doesn’t mean I have to be happy about the drop in yield. This is “rewards checking,” after all, where I actually have to expend some effort — like using a debit card at least 12 times per month, which I’d otherwise never do — to earn that rate. And even then, it’s only on the first $15,000 of deposited funds.

    It’s not necessarily the pure dollar figures that tick me off, either. Where my dividends in this account had been running in the $50 area each month, I’ll now be getting somewhere in the vicinity of $42. Eight bucks less per month? No big whoop.

    Rather, what gripes me is the fact that rates are being anchored to the floor, and pushed ever lower, because there’s so much STUPID (yeah, that’s a noun) in the system that allowing rates to rise to a market-clearing level would apparently bring about financial chaos. I mean, heaven forbid true risk get priced in anywhere. Financially-spotty paper assets getting repriced to true, “non-easy money” values? Lord, no! Insanity! Why, think of the children!

    (At this point, Watson, if you’ve surmised that I’m not a fan of the Federal Reserve, you’d be correct.)

    So Why Save?

    It’s quite obvious at this point that, while their PR firms say otherwise, the absolute last thing that The Powers That Be want us middle-class folk to do is save our money. (Neat corollary: One of the reasons we inhabit the economic muck of today is that no one has been saving, really saving, for decades. And if any of us were to do something crazy and start saving now on any kind of sizeable scale, well, we’d be in the soup. Since no one has been saving for years, and instead has been taking on “cheap” debt like there’s no tomorrow, we certainly can’t afford to save now. See how it all makes perfect sense?)

    But if you’re me, and you like to be able to sleep at night, you save anyway.

    You save, because somewhere down the line you’re going to need a new truck, and paying interest on top of the already-silly prices on cars just wouldn’t be kosher.

    You save, because while you replaced your central heat/air system just a few years ago, experience tells you that Murphy likes to show up unannounced and make roadkill of pretty much any four- or five-digit home repair item he can find.

    You save, because deep inside, there’s that vindictive inner self who believes that cramming hundred-dollar bills into a bank bag stored in your home safe means that somewhere, a banker or Federal Reserve governor breaks down in tears. (Or, if you prefer, with each crisp Benjamin you take out of the system, a hefty .0000000137 jobs are destroyed. I don’t have any evidence to back that up, of course, but then my inner self isn’t actually a stickler for facts, either.)

    So go ahead, Federal Reserve, and keep massaging those rates down, down, down. Our beloved banks will have choice but to follow suit. And keep huffing and puffing to prop asset prices up, up, up. There won’t be any negative repercussions to any of this; no, of course there won’t. History has shown us, time and again, that there never are. It always works out well.

    For somebody.

    Just never the savers.



  9. Unleash the (CFPB) Hounds!

    For the three of you who are still wondering just what the heck the new Consumer Financial Protection Bureau (CFPB) is all about, well, I direct you to this fancy CNN Money presentation:

    CNN Money: The New Pup Watching Our Money

    I’m sure this new agency will cast just as watchful, keen, and vigilant an eye over our money as all the other government agencies do. I mean, this was Elizabeth Warren’s brainchild, so it has to be good, right?

    (If you think I’m being sarcastic, congrats! You’d win a cookie … if I had one to hand out.)

    And, in what has got to be one of the most pathetic “Reasons We Need This New Government Agency” passages I’ve yet seen, I encourage readers to mouse-over the red “16,109” circle in the “Mortgage Brokers” section of the CNN presentation. Read what Mr. Carlo Panno has to say about the “sack of money” the evil bank all but forced him to take to buy a house.

    Always the studious type, Mr. Panno carefully read his mortgage docs before signing them … noticed that his payments would balloon from $300/biweekly to $1000/biweekly after two years … and then STILL SIGNED THE NOTE because the broker “assured him” he could refinance before the two-year SAVINGS EXTRAVAGANZA expired. (Heard that one before? Yeah, me too. About a million times.)

    You know what I think? I am quite certain that there is not, and never will be, a government agency capable of protecting glasslickers like this from themselves. (Much less those dastardly banks and mortgage brokers — for whom, I should point out, I harbor scarce love.)

    Note to Mr. Panno: Next time you leave the house, don’t forget your helmet.



  10. Travel On the Edge

    As a guy who believes in keeping at least $50 in cash on me (plus the usual credit and debit cards) whenever I’m out and about, I simply do NOT understand why anyone would GO TRAVELLING WITH ABSOLUTELY NO CASH ON HAND.

    And yet, in the auto-service business, I see people doing this fairly often. Typically it involves someone’s vehicle breaking down, leaving them stranded — at least for a while — somewhere far from home. When this occurs, what are they carrying in their wallet or purse?

    A driver’s license, a debit card, some photos … and that’s it.


    Can people just NOT think ahead at all? Does anyone play “What if?” before heading out across the state?

    What if you’re 500 miles from home, and, for who knows what reason, your debit card doesn’t work? With no credit cards in your wallet, and no cash, what will you do then?

    As I’ve said for years, debit cards are often NOT your best friend. I love my debit cards, but they’re certainly NOT a foolproof payment method when travelling.

    (And no, I don’t care what Dave Ramsey says about “All you ever need is a debit card.” I, for one, try not to live my life at the mercy of my bank’s change-on-a-whim debit-card policies.)

    Big Tip: Always Have More Than One Way To Pay

    As I mentioned in a 2007 post, I consider it vital that we ALWAYS have more than one way to pay. Whether “Plan B” is cash, credit card, or debit card, I don’t much care. I just make sure that there always IS a Plan B. And that goes for quick trips to the corner store as well as cross-country jaunts.

    So much that happens in life is out of your direct control. Doesn’t it make sense to exhibit some control where you can, and always have a backup method of payment?

    It sure does to me!