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Well, yes and no. I had a car loan from PNC bank once, and to entice me to open a free checking account they offered to take 25 basis points off the loan if I signed up for automatic drafts.
PNC welcomed me into a no-fee relationship because it opened the possibility that I'd move my other accounts there. As it turned out, I wasn't unhappy at Wells Fargo or my local bank, so after the loan was paid off I left PNC.
Tons of consumer banking institutions have relationship models now; Bank of America, AMEX, CitiBank, etc...
It's simply a natural progression of banks getting into all sorts of businesses and or bringing same under tighter umbrella.
Citibank's savings rate is 4.35% for their Citi Accelerate Savings account.
I've had my Citibank accounts for a verrrrry long time. I've changed my residence through four states since then. The closest Citi branch is probably at least four hours away. But I have kept those accounts all these years.
I travelled globally, and I found their online system to be excellent, regardless of my location. Paying bills from Hong Kong or Paris was the same as being at home.
I use a second bank that has more local branches than Citi throughout the US as I continue to travel, but mostly domestically.
Citi Accelerate Savings is not available to NY residents like myself. I am earning .03% on one Citi savings account and .02% on another, a far cry from 4.35%. There are slightly higher rates for accounts like Citigold where you get .35% with I think $200,000 to qualify for Citigold.
I have a Citibank branch within walking distance and several others nearby which is why I’ve stayed with them for decades. I still do some banking in a branch so I need a branch close to where I live. It may not seem like an issue because you can always drive to one but when my car needed a new transmission I didn’t have a car for almost two weeks.
BTW, I called Citibank to ask about the changes and I got a representative who seemed to be in a call center in India. It was difficult to understand him because of his accent and he seemed to know less about the changes than I did. He told me I could just choose not to participate in “Simplified Banking” but I told him it didn’t seem optional. He had to check and came back and said I was correct.
I am in NYC so I don’t know if this applies everywhere. My online account has a message about “big changes coming” and basically it will be harder to avoid monthly fees. No longer will a minimum balance waive the fees. You have to have an “enhanced direct deposit” of $250 or more a month to waive the fees. Right now monthly fees are waived if you have a $1500 balance. I have multiple accounts at Citibank as well as other banks and don’t have multiple direct deposits coming in that I can just dole out to waive fees. I have had Citibank accounts for over 30 years but it looks like I will have to close some or all.
Edit: Maybe this post doesn’t belong in the “Investing” topic but I caught my mistake after posting.
The first question that comes to my mind after reading your post is "Why do you find it necessary or desirable to have multiple accounts at multiple different banks and yet not have enough on deposit there to meet the bank's minimum?"
I might understand if you had hundreds of thousands of dollars and felt that it was best to spread it around a little bit, but I'm just puzzled why someone would think it necessary to have multiple accounts at multiple banks if the accounts don't have more than a few hundred dollars each.
Citi Accelerate Savings is not available to NY residents like myself. I am earning .03% on one Citi savings account and .02% on another, a far cry from 4.35%. There are slightly higher rates for accounts like Citigold where you get .35% with I think $200,000 to qualify for Citigold.
I have a Citibank branch within walking distance and several others nearby which is why I’ve stayed with them for decades. I still do some banking in a branch so I need a branch close to where I live. It may not seem like an issue because you can always drive to one but when my car needed a new transmission I didn’t have a car for almost two weeks.
Sorry- I didn't realize that product/rate wasn't available in NY. NY was the location of my first Citibank account. Lots of branches around in NY and CT.
Now there are no branches where I live, but a better interest rate. I guess I'm ahead.
I have multiple accounts at different banks for various reasons such as convenience of access to branches and ATMs and at different banks for higher interest rates on savings and to spread money around because of FDIC limits. Nobody has sympathy for a depositor who loses money because they had deposits over the FDIC limits. While I have multiple accounts I don’t have the same number of direct deposits that I can spread around to every account. Most people only have one direct deposit and that would work for a person who only banks at one institution.
There are many banks that have no fee checking with a small minimum balance or even without a minimum balance. Capital One doesn’t have fees. Dime Bank has a $1500 minimum balance for free checking and no minimum balance for those 50 and over. Chase has free checking if you maintain a daily balance of $1500 or more. I’m sure there are other banks with similar accounts. I have accounts with some of these banks but I kept my Citibank accounts because they have many branches near me while the others don’t. I hate to leave a bank after 30+ years but I will if they make these changes.
If the reason you have so many banks is in part because of FDIC coverage limits, then what’s the issue maintaining a minimum balance at Citibank? FDIC limit is $250,000 and Citibank is “only” asking you to keep $30,000 there.
The first question that comes to my mind after reading your post is "Why do you find it necessary or desirable to have multiple accounts at multiple different banks and yet not have enough on deposit there to meet the bank's minimum?"
I might understand if you had hundreds of thousands of dollars and felt that it was best to spread it around a little bit, but I'm just puzzled why someone would think it necessary to have multiple accounts at multiple banks if the accounts don't have more than a few hundred dollars each.
I never said I used multiple accounts to deposit “a few hundred each”.
In another post I wrote “I have multiple accounts at different banks for various reasons such as convenience of access to branches and ATMs and at different banks for higher interest rates on savings and to spread money around because of FDIC limits.” I am not getting into how much I have in savings but money would be at risk if I used one bank and it failed.
I keep a few thousand at Citibank for basic banking. I don’t put hundreds of thousands in a Citibank account because Citibank pays .12% interest and other banks I use pay 4.30% to 5.00%. (Thousands of dollars is more than “a few hundred” BTW.)
I don’t know why you think I would write about being concerned about FDIC insurance limits if I only had a few hundred dollars.
If the reason you have so many banks is in part because of FDIC coverage limits, then what’s the issue maintaining a minimum balance at Citibank? FDIC limit is $250,000 and Citibank is “only” asking you to keep $30,000 there.
I have an account at another bank paying 5% interest vs. 0.12% maximum at Citibank.
If I put $30,000 in a Citibank account I would receive about $3 (or less) in interest each month. The account I have it in earns about $125 a month on $30,000.
Of course Citibank wants me to put $30,000 in the bank and pay me pennies.
Do people not grasp the concept of making money through interest on savings?
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