Opening your own savings account as a kid was once a rite of passage.
It was used to teach you the concept of thrift and putting aside money for things you wanted.
The account, of course, opened initially as Verna Wyatt for Dennis Wyatt, given the single digit nature of my age. It meant the account wasn't exactly mine as it required my mom to withdrawal money. Then at age 16 it was changed to a true joint account before I had the ability to remove my mom's name when I turned 18.
Initially the amounts I deposited were miniscule. They ranged from $1.25 to $10 and were what I earned selling Christmas cards door-to-door and later as an eighth-grader working part-time at the Squirrel Cage, the frostie my mom owned and worked at seven days a week so she could support four kids after Dad died.
When I started working for the weekly Lincoln News Messenger as the sports editor and photographer at age 15 and then a year later covering council meetings, the amounts I put into savings increased. It wasn't a lot given we had to help with expenses such as buying our own clothes but it allowed me to save money to buy my first car and to go toward college.
Without the reminder I needed to set aside for savings the proverbial hole that money burns in a teen's pocket would have been a lot bigger.
Savings accounts for kids are financial training wheels. It teaches delayed gratification and - given the fact you couldn't access it instantaneously and physically go to a bank between 10 a.m. and 3 p.m. weekdays (until 6 p.m. on Fridays) to withdrawal funds from savings - you gave a lot of thought to "big" purchases and the impact on your savings balance.
Bank of America has announced it is dropping a tool to help people not exactly flush with money manage their funds better by forcing their eBanking customers from the free checking account into ones that require a $12 monthly fee unless you have a minimum daily balance of $1,500 or a regular direct deposit of $250 or more. These accounts are used by low-income households including a fair share starting out trying to make it in the piecemeal and gig economy that isn't exactly conducive to direct deposits of compensation or pays a lot of money.
I get that checking accounts cost money to maintain. But what I don't get is why a bank would chase off a large chunk of customers who have the potential to become profitable for them as their earnings increase over the years.
On the flip side, Chase Bank this week rolled out a plan to invest $20 billion they will realize from the federal tax reform into up to 400 branches in new markets, increased lending for lower income house buyers plus boost wages for a segment of their retail banking staff. In other words, they are going after the little guy.
That first savings account I had was with Bank of America who worked mightily to get me to never ever again to do business with them. I stayed with them through honest mistakes including when they "lost" my savings account with $2,000 in it when it was switched over to a joint account. When they drained my account by posting checks written by a Denise Watt against my account and putting some of my checks into her account, I stayed with them. I was none too happy that the branch staff back then that hand processed checks were busy reading the names on the checking account rather than the numbers given I lived in a small town and they were clearly snooping.
I even stuck with them when BofA still held the Visa credit card business they originated, declined to issue me a credit card even though I had a personal account, business account, and a savings account with them. A week later I applied to, and secured, a Chase MasterCard that I ended up eventually getting up to a $15,000 credit limit thanks in a large part to the wedding and portrait photography business I had.
Bank of America finally made it clear they didn't want me when I had $2,500 worth of camera equipment trashed in a free-for-all at a wedding reception. My credit card limit at that time was $2,000 and I needed new equipment. I asked BofA for a personal loan of $2,500 secured in part by my car that was valued at $4,000 but they wanted a co-signer.
I walked across the street to the community bank - The Bank of Alex Brown. I got the $2,500 loan that day without any collateral and ended up paying it off in 12 instead of 24 months.
Needless to say as I became a bit better off financially or if I had a windfall of money, not one penny went to BofA.
Over the years BofA based on mass mailings of various offerings has probably burned through a small stand of trees as well as spent close to $300 on the cost of printing and mailing trying to entice me to do business with them after I became a desirable customer.
It's a free country but it's safe to say BofA continues to not want to grow business but rather pick off the low hanging fruit.
Meanwhile community banks work as a partner with customers and the markets they serve to grow communities.
This column is the opinion of Dennis Wyatt and does not necessarily represent the opinion of Morris Newspaper Corp. of CA.