I am not sure I would agree with the statement – however one element of their rewards program on the bank account is interesting.

In another post we will fully dissect the rewards structure but for today atleast just an appetizer.

Capital One will give you 10 reward miles for every debit transaction on the account – no big deal, they are not alone in giving points for debit transactions – it is the gimmick of choice for debit cards and credit cards at the moment.

What stands out is that they give you 10 miles (worth about 10 cents) per transaction – again big deal we hear you shout.

So what does this boil down to – you spend $10 you get ten miles worth 10 cents so you are looking at 1% return – equivalent to credit card reward program returns.  Obviously if you spend $100 then it becomes 0.1% – not so hot.

But you are looking at this the wrong way – what about those sub $10 transactions – this is where it gets interesting.

Yes, Yes we hear you shouting.  Many stores don’t allow transaction below $10 – but there are a few that do – infact their main selling point is usually some low dollar transaction. We are thinking of iTunes, RedBox, DVD Express, McDonald’s to name a few.

So you download a song for $1 – and you get 10 cents back in miles – that is 10% return – that we will agree is one of the most rewarding programs we can think of for now.

Just because we are who we are, we had to test it further.  So we pumped 50 cents of gas at a local BP station and yes we got our 10 miles – 20% return.  We went further, 30 cents of gas – 10 miles – 33% return.  On our third attempt our fearless investigator filled the tank – he was getting funny looks from other pump users, concerned looks from the garage attendant, puzzled looks from the kids and a most infuriating look from his wife in the car.

We don’t necessarily recommend breaking your gas station visits into $1 or less transactions – but if you do have small transactions ( sub $10) the Capital One Bank debit card may be what you should reach for.

So here is a crazy idea. You want to buy something you don’t have the money for, so you put money aside each week, month or paycheck. When enough time has passed that the amount needed has had time to accrue you buy the thing that you want.

Benefits of this process.

You don’t pay interest for the thing you want because you will not borrow any money. In fact you will be paid interest which in turn gets you to your goal faster.

You have time to think through your purchase and decide if it is really worth it to you.

Certain products may get cheaper over time or actually go on sale, or you have the time to research who else sells it and more importantly who sells it the cheapest.

The pleasure of anticipation and the satisfaction of knowing that you can actually afford what it is you are buying.

This is vintage thinking. This is the way it was done for years. This is the way your Grandparents did it. This is what they did when there were not any Credit Cards – yes there was a time when plastic wasn’t the currency of choice.

The times they are a changing and we need to change with it. It is time to think about what we want to buy and how we are go about paying for it.

Thankfully the changing times have made it a little easier, gone are the days of needing to separate your money up in envelopes of piggy banks (although they still work). Banks, whether they are online or traditional have made it easier to have separate savings accounts and even to have different amounts of money automatically going to them. Some banks even allow you to nickname your accounts.

So go and start saving for Christmas, a car, a spa day or an emergency. You don’t have to put everything on the card!

Ok this fee came into force on November 7th 2008, other banks impose similar fees but thankfully it is fairly easy to avoid.

The first and maybe it is the most difficult is to avoid using it in the first place.  Don’t see zero as zero, build a buffer into your finances so if you know you are low in your checking account, say $100, move some money in.  Not the most exciting way but maybe this is tough love getting your budgeting back on track. If that won’t work for you read on.

Option 2.  It hasn’t been communicated very well, big surprise, but the fee isn’t actually for using Checking Plus, it is for Citi moving the money for you. Huh! OK what do you mean.  If you know you are going to go into your checking plus then just move money in from Checking Plus to your checking account yourself.  You will still have to pay interest but you won’t be assessed the fee.  It is exactly like moving money from one account to another and can be done the same way, at the teller, at the ATM or online or thephone.

Option 3.  Our favorite, but only really a temporary solution.  Ask to be upgraded to Citigold.  Citigold customers are not charged the fee.  You qualify to be Citigold if you have $100,000 in assets and/or second mortgage debt, or $250,000 if you include a 1st mortgage.  If you don’t have these balances then you should expect a $25 per month service fee.   If you are continually being hit with several $10 fees this may be the lesser of two evils.  Thankfully while you think that over Citi waive the fee for the first 6 mths,  by then you may have changed your budgeting habits, decided on whether the $25 fee and some of the other benefits are more worthwhile (including more Thankyou points) or you can trade back down from Citigold.  Of course if you really are not sure then why not trade back up for another 6 mths…yes you can do that.

So Tom Daschle, President Obama’s pick for health and human services secretary, has some tax issues.  As a result of this coming to light during his confirmation hearings, he has withdrawn his nomination.

A week earlier it came to light that Tim Geithner, the newly confirmed Secretary of the Treasury, had some tax issues.

It seems that there is a cluster of tax issues.  It has been said that these people have complicated tax situations – our heart goes out to them.  It is embarrassing to have these tax skeletons come out of the closet in such public ways.

We think that maybe the people who are in public office need a little help so that problems don’t arise in future.

It would be such a shame for a talented person to be brought down at time we need them most because of complicated tax situations that they had overlooked or were inadvertent!

We have a solution – maybe a department of government could be set up that would specifically look into the personal tax arrangements of these people with ‘complicated tax situations’ every year.

Rather than having to wait a career to get to the level where a senate conformation is held, for a problem to then come to light, wouldn’t it be better that all members of senate and congress could be ‘helped’ with their complicated tax stuation each year.

Thankfully there is already a department in government that could do this.  Their team is in place, shovel ready – and they are called IRS auditors.

Yes, all members of congress and the senate and anyone running for public office including governers and mayors should be audited each year.  Their roles, positions and reputations are too important for a tax issues to be overlooked.

Any extra taxes that are collected because of this action would not only pay for these special audits but might go a small way towards helping with the bailouts.

Have your say at www.insiderbanking.com

It was inevitable but we hoped it wouldn’t happen.

Still by far the best reward program going, as far as being able to accrue points in many different ways (see other Thankyou Posts), however a change is coming.

The fixed rate reward redeption, that could be used to redeem airline tickets on expedia is gone come March 1st 2009.

You know the one we mean e.g. 20,000 points for a domestic ticket up to $400 in value ( and variations on that theme).

Be quick, make use of those points at the enhanced level while you can.  You don’t have to come up with a reason to head to Las Vegas in February.  Your flight plans can be later in the year, just book them before the month runs out.

As a Thankyou rep diligently told us this change is a good thing and will make things less complicated – and less generous (that last bit they didn’t say).

The changes do have some good points though.

It is less complicated and does have more flexibility.  Every thousand points will be worth $10 on expedia, for anything.  Your points can be used for not only the flights but also for taxes and fees which is a really positive change. 

If you were short points you used to be stuck.  You could buy the points at a crazy rate or go without.  Well now if you are short you can make up the difference with cash.

Overall a change for the worse, but some improvements also.  Go book your flights now don’t wait until March.

You could be forgiven for thinking that Chase appears to have been the only bank to have weathered the recent economic storm.  It had better earnings results than pretty much anyone else in the banking sector.  They don’t want any TARP money (but then they probably want to keep their bonuses.)

So how are they doing it.  That we don’t have the exact answer for but it appears now that they brought out all the great news to coincide with the bad news from other banks they have strangely adopted a quieter stance.

Maybe they have lost their voice and that is the reason they can’t tell you they have dramatically dropped their interest rates on your accounts – think you are getting 2.5%, or 1.85% – keep going.  Call Chase customer service right now (1-800-935-9935) you may be in for a bit of a shock.

But rest easy, feel good with yourself – you are helping them keep their bonuses.

Each legal titled account is now insured up to $250,000.

Beneficiaries no longer have to be Parent, Spouse, Sibling, Child, Grandchild or step and adpoted version of the above – it can be anyone.  Your in Laws, your life partner, your best friend Fred who lives down the street, President Obama, Former President Bush or even Oprah Winfrey.

SO for example and for kicks, Joe the plumber and his wife, can have an account that reads like this.

Joe & Jill ITF Barack Obama, George Bush, Oprah Winfrey and that account can have $1.5 Million in it.

Heck if your feeling generous Joe & Jill ITF for Hillary Clinton,  but don’t stand too close to the train tracks as her campaign is six million in debt.

The new changes set to expire Dec 31st 2009 – maybe!

It has been on people minds recently – how do I protect my money when it is in the bank. Here at Insiderbanking.com we want to make sure you know a little more about FDIC limits so you can sleep a little better at night.

This is not going to be some long winded post delving into the depths of FDIC – go to their website for that, which can be found at http://www.fdic.gov

Rather, this is just a quick reminder – the maximum FDIC coverage is not $100,000. In fact you could shelter millions of $ across many different banks or indeed in any one bank.

It is 100K for an individual account, 200k for a joint accounts and 100k per signer and qualified beneficiary combination.

Qualified beneficiary? – well they are the people that the FDIC recognises. Parent, sibling, spouse, child, grandchild and adopted and step versions of those. Sadly not nieces, nephews and in-laws.

So hyperthetical scenario you and your wife have 2 kids and four darling grandchildren.

Maximum funds that could be insured …drum roll please….$1.8 Million – and that is before we get creative and include broker cd’s and retirement accounts.  You don’t believe us on the 1.8 do you.

Husband (100K)

Wife (100K)

Joint husband & wife (200K)

Husband ITF (In trust for or payable on death) Wife, Child 1, Child 2, Grandchild 1, 2, 3, and 4 (700K)

Wife ITF Husband,  Child 1, Child 2, Grandchild 1, 2, 3, and 4 (700K)

Now of course the Wife ITF for the tribe doesn’t all have to be one account, in fact your bank might not allow it.  It could be set up as seven seperate accounts with one beneficiary – each account covered for 100K.

Anyway – we just wanted to clear that one up a little bit.

If you have any questions, about this or anything else then please leave us a comment and we will do our best to answer it.

Here at InsiderBanking.com, we like you to get the most out of your banking relationship.  Many of the current articles have been about getting the most Thankyou reward points from Citibank and its partners.  We also want you to be able to get the best use of these points.  Other articles will tell you how else you can use your points but what follows is the absolute best $ per point use there is.

So you have thousands of points and you want to make the most of them, well get your bags packed because you will be taking a trip or two.

You can use your points to book flights on any airline that Expedia
accomodates.

There are two ways you can convert points into flights.  The first and best is by ‘Fixed’ conversion – in which case you have to call 1-800-Thankyou.  The other which gives you a little more flexibility (but isn’t as cost effective) is called ‘variable’ conversion.  You can use that by going to www.thankyou.com and clicking on flight rewards which then takes you to expedia but using Thankyou points as your currency.

Fixed rate conversion:

This is only available to you if you have certain credit cards or a bank account with citibank, Or an account with Expedia.  Get a bank account it is easy, it will enable you to get more ThankYou points and it will be free if you take the advice in the other blog articles.  Getting an account with Expedia
is the quickest way to make use of the Fixed rate conversion

Anyway back to the fixed conversion. So the conversion amounts and what you get are as follows:

Continental US, Alaska & Canada, 20,000 Points, up to $400 in value (90,000 Points, $2700, Business Class)

Puerto Rico to US (48 States), 40,000 Points, up to $800 in value (Business class not available)

Mexico & Central America, 45,000 Points, up to $900 in value(120,000 Points, $3600, Business Class)

Hawaii & Carribean, 50,000 Points, up to $1000 in value (140,000 Points, $4200, Business Class)

Europe, South America, 60,000 Points, up to $1200 in value (180,000 Points, $5400, Business Class)

Middle East & Africa, 80,000 Points, up to $1600 in value (200,000 Points, $6000, Business Class)

Asia, 80,000 Points, up to $1600 in value (240,000 Points, $7200, Business Class)

Australia & South Pacific, 100,000 Points, up to $2000 in value (180,000 Points, $5400, Business Class)

For doller amounts above the maximum you can use increments of 5000 points per additional $50

You can’t use Thankyou points for the taxes.

The second way is variable conversion.  It is more flexible and is better value for lower priced tickets or if you want to book hotels or cruises.  The conversion rate is 1000 ThankYou points per $10.

So sure you can use your ThankYou points for Starbuck Vouchers but the caffeine won’t get you as far as the Flight reward usage.

Just a quick post from InsiderBanking.com just incase any of you are doing or about to do a Balance Transfer on a credit card.

You are probably doing it to get a low or zero percent deal.  We are sure it makes sense but don’t mess it up by falling into this trap.

 If you owe anything on your credit card before you do your Balance Transfer it is probably at a higher rate.  If you do not clear the balance before you do you transfer then your low rate and old rate debt are both on the card.

 When you make a payment you will find it is always the lowest rate deal will be paid first.  You will be paying off first the deal that made sense and the higher rate debt will be growing steadily in the background. Untouched by your payments.

Make sure you clear that old debt first by paying it off even if you use a high interest loan first (you will only use it for a few days – and then pay it back with part of the Balance transfer- make sure you use a loan with no early payment penalty)

Once this is done then go ahead and do  the Balance Transfer – making sure to pay off that short term loan you used.

Also don’t make mistake No. 2.  If you have done a Balance Transfer, lose the card, hide the card, destroy the card.  Whatever you need to do to make sure you do not spend on it.  If you do that spend will inevitably be at a higher rate and again it will be behind your low interest rate deal and you will be paying that low rate off rather than that new spend which will be compounding at the higher rate.

If you have any sucesses or failures with this or have a comment or question please let us know – we can all  learn from each other if we all become Insiders.