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@AverageJoesCredit wrote:
I have 2 local branches yet they are useless to me as Penfed doesnt want to help little fish. I agree though for those who make good money parking $500 shouldnt be an issue.
To me it doesn't have to do with how much money or income one has, it's the principle of the thing. To my mind it's ridiculous to charge a $10 per month fee for a personal checking account which offers basically nothing.
I do have it, because I find PenFed to be a useful credit union, and I like getting the 2% cash back on the Power Cash Rewards card. I do my best to avoid their dumb fee. Sometimes I've let my money sit there. But my main method of avoiding the fee has been to do direct deposits or ACH transfers which count as direct deposits.
There are some pretty good advantages to using PenFed, and it also has some weird negatives. On balance I have found it to be a plus, but who knows what the future may bring. Maybe the negatives will wind up outweighing the positives, maybe the negatives will get fixed when someone smarter comes in to manage it.
@Revelate wrote:
Why do you think banking and checking are free?
We talk about being profitable for credit card issuers, frankly the same applies to other products too. 500 x 3% = 15 bucks per year that the bank (or Penfed in this case) is making. Seems reasonable.
Also there’s so many ways to deal with a direct deposit requirement too.
DCU offers free checking.
@Revelate wrote:
Why do you think banking and checking are free?
We talk about being profitable for credit card issuers, frankly the same applies to other products too. 500 x 3% = 15 bucks per year that the bank (or Penfed in this case) is making. Seems reasonable.
Also there’s so many ways to deal with a direct deposit requirement too.
I have an actual bank, FirstBank Holding Co, and they have no minimum balance, no direct deposit requirements, and thus no fees. I don’t think it unreasonable to expect the same from a credit union and indeed, neither NFCU or DCU have a minimum balance, direct deposit, or fee requirement and instead DCU chooses to offer relationship benefits if you do more with them on top of their free checking.
PenFed is quite a terrible option in comparison, especially for the first 6 months for them to decide they trust you.
@AverageJoesCredit wrote:
This thread is freaky lol. Today i received my first ever paper mail from Penfed🤯 about, lol, their Access America checking haha. I cant believe they even remember me let alone waste the time to send me anything. Oh and SJ, yeah, i wouldnt pay ten bucks a month for an account i wasnt using
Well, I think it's helpful to point out the pros & cons of banks/CUs.
I've been with Penfed since May 2017. First of all I think the heavy restrictions for the first 6 months are excessive and annoying - you hard pull my credit report for membership, have some confidence I'm not a con artist. I think Penfed is pretty good for secured credit - car loans and home equity - but very hit or miss on credit cards. If you can stay under 6 transactions per month their Premium Savings is a much better choice than their checking, but even then they hit Premium Savings with their "Penfed Specialty" with a 5 day hold on funds even when transferred in from another Penfed account. Ridiculous, but manageable to work around.
So I have the required Share savings with the minimum balance, Premium Savings, and Home Equity LOC.
My apologies, it's evident my point wasn't clear.
"Free checking" is a money losing service: it costs money to offer a checking account. That was my point in that it's not free, some lenders will choose to give their customers that while presumably making money elsewhere to offset it (loss leader in business terminology).
The larger banks, and some CU's, have realized they were losing money there so now they have minimums around either balances or direct deposit, which incidentally get waived at higher tier of relationships... where they're making their money elsewhere.
Apologies for not being clear on that point, just because it's given to you for free it's not zero cost to the lenders, so don't be surprised when a lender decides to charge for that... as usually you get something different in return for those account minimums: see Chase + Sapphire Banking / YouInvest for a modern example.