Unless you have had your head stuck in the sand recently, you are aware that Bank of America has announced they will begin charging for debit card usage later this winter. Other big banks are already following behind them, but their news may not have been as widely publicized. Big banks have decided that one continued way to make money is right on top of you – and now in your use of a debit card.
As a financial coach who teaches people to be responsible and deliberate in their spending, I am ok with the news. Really, the debit card, just like other pieces of plastic, will enable you to overspend. I recently wrote a blog about that and you can read it here. However, if you continue to use the debit card be prepared 1) pay the monthly cost and 2) be subject to spend more than you want or should.
Beyond the big bank that has now made you unhappy, you can also thank our friends in Washington. In their effort to make things better for everyone, they continue to tell banks where they can make money or profit. So, when the big banks find the road closed in one spot they try to find a detour. This post is in no way a debate on how much profit they should make, but simply keeping in focus with the debit card.
Am I against the debit card – NO. Big banks – NO. What I am for is your ability to live within your financial means and a very large number of people can not stay on track or plan with a debit card.
So what are you to do? Shop around if the debit card is a must. Find another bank that will not charge you for a debit card and, while you are shopping, do not forget credit unions.
In the last few days I have heard and read of theories that the big banks are not specifically trying to get money from you for a debit card, but that they may be trying their best to push you back to a credit card (they may make it “fee”) so that you can overspend as you did in the past. Could that be the case? Could their revenue push be in the form of interest?
However, for those of you who really want to get ahead – throw out the debit card, save your monthly charge, and get on a plan you can stick with it. You can live without a debit card. Right now, I have several clients who have cut up their debit card, have it frozen in the freezer, or locked in a safe – they have taken control of themselves!
Just so you know, most places still take cash!
If they aren’t using a debit card does that mean they’re those people I’m standing behind in line at the grocery store checkout writing out a check? LOL I suppose that’s what you’re left with if you don’t want your wallet filled with paper and coins.