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Should I keep old credit union account open?
Old 04-03-2018, 08:08 AM   #1
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Should I keep old credit union account open?

I have a credit union account in another city, 200 miles away, associated with one of my ex-employers. A number of years ago I moved over to PenFed for my primary bank account, and have a savings acct at Wells Fargo just in case I need local service, or a 2nd ATM option. I had an HSA (no fees and good fixed interest rate) with the CU but just moved that out to give more investment options. I had kept the CU checking account funded and used it for checkwriting because I happened to have a lot of checks and was starting to run low with my PenFed checks.

Recently there was a discussion in another thread about simplifying accounts, and I decided there was no reason to keep the CU account anymore. It's just one more place I have to keep money to cover checks. I've transferred most of my money out, and just have one more check to clear, then I can PM the bank and they can close it and mail me a check for whatever is left.

But should I? All I have to do is keep $250 in the account to avoid an inactivity fee, and there are no other fees. They provide a $1500 death benefit, which I rediscovered as I was going through my lock box today. That's what made me start to reconsider, that I could keep the policy just for tying up $250. It's possible they'd have some other benefit I'd use, though most of what they offer is local. It's possible I'd move my HSA back once I start withdrawing from it and the balance gets to low to make investing worthwhile. Or maybe I'd have issues with PenFed and want to leave them, and it'd be pretty simple to start using the CU again.

Looking for any opinions on pros and cons of leaving the account open that I haven't thought of. I keep a record of the account in my lock box and estate instructions so it wouldn't be forgotten, and $250 is no big deal if it is. I could forget about it in my month-to-month dealings. I'd keep a line in my "Net Worth" spreadsheet which would be a reminder that it's still there. I similarly have a few cents in my TDAmeritrade account that I haven't done anything with in years, but I just logged in and see it's still there if I ever decide to use it again.
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Old 04-03-2018, 08:11 AM   #2
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In the situation that you describe I would close it in the interest of simplicity. Manytimes, less is more .
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Old 04-03-2018, 08:50 AM   #3
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Many credit unions have a once a member, always a member policy.

If this is the case you could close the account and perhaps reopen it later if you change your mind.

If the $1500 death benefit motivates you, you may wish to open up multiple credit unions at various institutions to scale the benefit. Just make sure its not the same insurance company sponsoring the coverage with limits on how many times they will pay out.

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Old 04-03-2018, 04:55 PM   #4
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I think for now I'll just leave it open with minimal funding. If it turns out to still be a hassle, I'll close it.
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Old 04-03-2018, 09:43 PM   #5
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Just make sure that they don't' have an inactivity fee, and they start "dinging" your account with said fee until it runs dry.

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Old 04-04-2018, 05:19 AM   #6
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Just make sure that they don't' have an inactivity fee, and they start "dinging" your account with said fee until it runs dry.

omni
It says I have to do a transaction every 6 months or keep $250 in the account. I put a calendar reminder every 5 months to switch $20 between checking and savings.
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Old 04-04-2018, 05:29 AM   #7
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It says I have to do a transaction every 6 months or keep $250 in the account. I put a calendar reminder every 5 months to switch $20 between checking and savings.
If it is like most consumer contracts, I suspect the terms could be subject to change at any time.

Might want to check a statement every quarter or so to verify that they haven't changed terms and started to ding you.

Had this happen to me with a CU as part of their newly launched "Members Rewards" program. Seemed innocuous enough. I eventually learned, however that one of the rewards was a fee free account -- if you jumped through all their monthly hoops.

The account was previously fee-free, however, prior to the "Members Rewards" program with no hoop-jumping required.

edit: I didn't catch this until several months down the line and was not amused with the $5-$10 monthly fees that had been accruing.

I was not happy with them and let them know by closing all the accounts.

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Old 04-04-2018, 09:27 AM   #8
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$250?? I'm a member of several C/Us. I do all my primary banking with NFCU but I keep the other C/U accounts open for possible future loans, CD interest rates, etc. I'm only required to have a $5 balance in my account to keep it open.

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Old 04-04-2018, 09:38 AM   #9
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OP mentioned that he had a checking account. $5 requirement at CUs is usually in a Savings account from what I have seen.
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Old 04-04-2018, 09:43 AM   #10
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OP mentioned that he had a checking account. $5 requirement at CUs is usually in a Savings account from what I have seen.
Either/or for the credit unions I belong to. You can either open a checking or savings account, or both, but each account only requires a $5 balance to remain open.

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Old 04-04-2018, 09:50 AM   #11
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Maybe OP can setup SMS text alerts when there are transactions on the account or the balance goes below a preset level.

This could be a way to detect the imposition of any future fees without having to keep reading statements on a regular basis.

"Once bitten, twice shy" as described in above post.

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Old 04-04-2018, 10:27 AM   #12
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Many credit unions have a once a member, always a member policy.
I found this to be the case when I moved back to my home town after almost 30 years. I used to be a member of DF's employer's CU but had closed the account when I moved out of town. Upon my return, I decided being a member of a local, brick-and-mortar bank would be good for keeping some just-in-case money.

I went to a local, independent CU to apply. Lo and behold, it turned out to be the descendant of my old CU from many years ago but I had no idea. When the person helping me put my SSN in the computer she found my name already there. Kind of annoying to know they keep your SSN for so long, from a security point of view.
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Old 04-04-2018, 10:38 AM   #13
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$250?? I'm a member of several C/Us. I do all my primary banking with NFCU but I keep the other C/U accounts open for possible future loans, CD interest rates, etc. I'm only required to have a $5 balance in my account to keep it open.

Mike
My local CU calls for $100 if you only have savings to avoid fees.
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Old 04-04-2018, 02:40 PM   #14
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$250?? I'm a member of several C/Us. I do all my primary banking with NFCU but I keep the other C/U accounts open for possible future loans, CD interest rates, etc. I'm only required to have a $5 balance in my account to keep it open.

Mike
Different CU, different rules, I guess. I'm sure I could keep it open with $5 or maybe $25, but I'd be subject to an inactivity fee. I'm doing both a transaction and keeping $250, but if I miss a transaction I should be ok. And that transaction is an excuse to look at the account to make sure a fee didn't creep in.
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Old 04-04-2018, 02:55 PM   #15
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I'd go for simplicity and close the CU account and the Ameritrade account. I have everything of mine at Schwab and Capital One, except my TSP account. Very easy.
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Old 04-04-2018, 06:44 PM   #16
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I hear what you all are saying about simplicity, but the TDAmeritrade account is no hassle whatsoever. I get an account statement notice once a month that I discard. I suppose maybe I should close it, because I'd probably miss a bonus if I just funded it again vs. opening a new account. My credit union has no such deals for new accounts so that's not a motivation.

Maybe after a year if I find I'm not using the CU account I'll dump it, because it bothers me slightly to tie up $250. The TDA account has been dormant since 2013 and that bonus thing now has me thinking. I actually intended to empty it in 2013 and let it die but there was a stray penny of interest. I guess I will see how to get rid of that.
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Old 04-05-2018, 08:25 AM   #17
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I would close it.

Ask yourself "does this account offer me enough benefit where if I didn't already have the account, would I go open a new one?

I have to admit, I'm on a simplicity kick these days. I don't really see the benefit of having a dormant account 200 miles away.
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Old 04-05-2018, 10:19 AM   #18
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Opening an account is a little more complicated that keeping one open, but I see your point.

I'm going to ask my son if he'd rather have one less account to deal with for that small benefit.
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Old 04-05-2018, 12:24 PM   #19
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Opening an account is a little more complicated that keeping one open, but I see your point.

I'm going to ask my son if he'd rather have one less account to deal with for that small benefit.

Mine requires only $5 balance in savings, no balance needed in checking. I often run it down to zero and have a small overdraft account that has no fee.

I've had this account for 21 years and even one merger.

I keep it open because of the free overdraft protection, low balance requirement and ability to transfer to and from some family members that also have an account including DW.

They can't be making money off of us, but I guess we do occasionally have some money to bear interest in there.

EDIT: one other benefit, I can access a shared branch in other states when traveling. Although I feel that eventually that benefit might be mute as more services migrate online and over the phone.

Reduces ATM fees on vacation on occasion.
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Old 04-16-2018, 06:56 AM   #20
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Update: I rechecked the death benefit. It pays in accidental death cases only. I sent a secure message to close the account last night, which they told me was an acceptable method.

I also transferred my last .01 out of TDAmeritrade. This should eventually cause it to be closed due to inactivity, as they did for my IRA. Otherwise I'd have to call and I've heard it can be a long wait on hold, and then they will try to talk you into staying. I don't feel like dealing with that so I'll let it wither and die.
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