Banking Agreements

[imoldernu]

I recently received from my bank, a
"Consumer Deposit Agreement and Disclosures"

This is a 13 page agreement printed in 4 point type... (very tiny, less than 1/8 inch) and it literally covers the pages from edge to edge.

What to make of it? While I'm not a lawyer, the wording is a virtual TOTAL indemnification of the Bank from any and all legal action... with a final sentence that gives the procedure to opt out of binding arbitration, (which looks to give the bank a right to reject your account.)

Yeah... so what's new?... Let me suggest that I have never, ever seen a document so loaded with exclusions and penalties to the customer.

One of the minor factors concerns CD's, and penalties for early withdrawal. While today, the interest rate on a 5year CD is just over 1%... any withdrawal made within the first year results in a penalty of 365 days interest. That penalty would result in a charge to the capital amount. similar charges to lesser terms.

The most bothersome part of the agreement is the part about withdrawals of monies from any type of account. There is a long list of different kinds of delays in making available your own deposit funds, whether by check, or in some cases cash. If an account is funded by an ACH transfer from another bank, some types of withdrawals may be restricted for 45 days.

Overall, this funds availability and the Binding Arbitration (new and boilerclad beyond belief in the bank's favor) signal a new hard line.
............................................................

On another newly arisen issue (not from my bank) there appears to be a new movement afloat re: banks and the availability of cash. You may do your own research on this, but it seems that deposit slips in some banks may put limits on the amount of cash you can withdraw from your own account. "Further review may result in delayed availability of this deposit". https://answers.yahoo.com/question/index?qid=20140820110704AAnEIo8

That said, there seems to be a movement underway that works to influence the cash society to move toward a cashless society. Here's a "for instance"... Schwab is moving towards Money Market Funds that are based on cash value, to change these assets into bonds.

Money Market Fund Reform

Much ado about nothing? Conspiracy theory? A look back to 1931 is a measure of how a shortage of cash can affect the wealth of the nation.

Perhaps nothing more than misplaced trust, but at the very least, taking a moment to consider where our personal wealth lies, and any effect that changes to a cashless society may have on our own liquidity.

 

[GrayHare]

IMO it's a symptom of banks not being able to earn as much on your deposits as in the past. When that changes in the future, banks will become more accommodating again.

 

[imoldernu]

Am afraid I was too obscure in discussing the effect of what appears to be major changes in the way banks do business and the implications of a cashless society.
On the surface the security and ease of access seem to be positives. A closer look, and a deeper understanding of macroeconomics and the interests of the state may present a different view of the future.

The second half of this interview from the Mises institute offers a more somber view of the national economic intent... particularly with regard to the effectiveness of the FED.

https://mises.org/library/we-are-headed-toward-cashless-society

While it may seem eons away today, any tumbledown that shifts monetary policy at the government level could have a rapid effect on investments and other cashless values.

In all fairness, a different view that is somewhat less dire. Yours to choose.

What Happens When We Become A Cashless Society? | Co.Exist | ideas + impact

In any case, whether next week or in a few more years, a subject that deserves some attention.

 

[Matthew J]

I had a similar situation when my mom asked me to sign on ad a joint owner on her credit union account.

The agreement was pages long and also referred to two other online documents.

I got to the part which said I would be liable for all my mom's debt upon her death and then stopped reading. My mom was pretty put off that I wouldn't sign the paperwork, but she is a spendthrift and no way did I want my inheritance to be a negative number.

In short, the day my bank sends me a set of conditions that complicated is the same day I shop for a new bank.

Sent from my XT1031 using Early Retirement Forum mobile app

 

[Sunset]

At my bank, when depositing a $7.00 check, they require to see your ID.
This is after I swiped my bank card so they can see the account name, that the account has been there a long time and has a few thousand in it.

Don't they understand, that I would be VERY happy if random folks came and put money into my account, which I hope they will allow after viewing the ID.

 

[Another Reader]

At my bank, when depositing a $7.00 check, they require to see your ID.
This is after I swiped my bank card so they can see the account name, that the account has been there a long time and has a few thousand in it.

Don't they understand, that I would be VERY happy if random folks came and put money into my account, which I hope they will allow after viewing the ID.

Deposit checks at the ATM. Wear a disguise to fool the camera.