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September 2007


If you’re a new reader to Consumerism Commentary, you may have missed some articles from September in prior years. Here are a few from the past. From the second half of September 2006:

* FranklinCovey’s 7 Habits of Highly Effective People
* 36% Say They Use a Financial Advisor
* My MBA at the University of Phoenix, Part 1: The Decision
* The 400 Richest Americans
* My MBA at the University of Phoenix, Part 2: Admissions
* Me Ex Paid for a Semester in College By Doing This…
* Review: The Money Coach’s Guide to Your First Million by Lynette Khalfani
* My MBA at the University of Phoenix Online, Part 3: Course Logistics
* What Should I Do With My Side Business Income?
* Do Not Upgrade to Quicken 2007, It’s Horrible!

Here are some from the second half of September 2005:

* Don’t Donate to Katrina Victims
* Consensus View is Better Than Experts?
* New York City Salaries
* CitiBank Strikes Again
* Raise Your FICO Credit Score
* It’s Not What You Make, It’s What You Spend. Whaa?

The second half of September 2004 produced several articles, including:

* Looking Forward to Raises
* Allow Me to Grow Personally and Professionally
* Annual Fee?!

Here are a few more retro articles, from the second half of September 2003:

* The Average Family
* How to Feel a Little Richer
* Which Degrees are Worth It
* Are You On Track?
* Six Tips for Investing Beginners

Don’t be left in the dark. Subscribe the Consumerism Commentary RSS feed and never miss another article.

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I mentioned yesterday that NetBank melted down and was taken over by ING Direct. Most customers will have a seamless transition, but not everyone.

Applied Cognetics, a small business, held about $1 million in deposits at NetBank. They won’t be able to access that money for quite some time — if they ever get paid back. Why in the world would anyone keep more than $100,000 in a bank account? The FDIC insures only up to $100,000 per customer (plus another $100,000 if they hold a joint account). That means that if the bank dissolves, customers will still be able to get to their money.

NetBank will owe this money to Applied Cognetics, and any depositor whose accounts were valued higher than $100,000. According to the FDIC press release, customers who have deposited more than the insured amount will receive an immediate payment of half of the uninsured balance. Applied Cognetics might receive the rest of the money eventually, but chances are they won’t be able to access it when they need it.

These are the chances you play with when you deposit more than $100,000 into a bank account. Knowing this, why did Appied Cognetics make this decision?

When Colthrust [president of Applied Cognetics] had approached traditional brick-and-mortar banks to open a commercial account, he found them unhelpful and the paperwork daunting. He never imagined losing access to his money.

Paperwork is a hassle, sure. The chances of a bank declaring bankruptcy are usually low. However, Applied Cognetics could have made better decisions about their money management. If you have lots of cash lying around, diversify across banks so you don’t exceed FDIC limits.

Could They Lose $900k? [Fortune Small Business Magazine]

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Thanks to the following blogs or websites (not including RSS readers or search engines) who sent the most visitors to Consumerism Commentary during the month of September.

# Get Rich Slowly
# The Simple Dollar
# Blueprint for Financial Prosperity
# MoneyBlogNetwork Home
# AllFinancialMatters
# FiveCentNickel
# Free Money Finance
# Consumerist
# No Credit Needed
# pfblogs.org

Here are the top 10 visited posts from the past month, including the last few days of August.

# 5 Romantic Outdoor Day Date Ideas Under $30
# ING Direct Drops Interest Rate From 4.5% to 4.3% APY
# The Declining Value of the MBA
# Intuit Quicken 2008 is Here
# Guide to Capital One Credit Cards
# Personal Balance Sheet, August 2007 ($107,488, +6.3%)
# How Many Earths Would it Take to Sustain You?
# Financial Advisers and Stock Broker’s: What’s the Difference?
# Bank of America Raises ATM Fees: How Do You Avoid?
# Opening a Business Checking Account

Please bear with me as I continue tweaking this new design. Those of you reading via RSS, make sure to visit Consumerism Commentary directly to take a look at the changes.

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ING Direct was the first of the major online banks to drop its savings account interest rate. ING Direct has had lower rates that most of the online banking institutions for the last several years, but as they were the first major presence on the scene and probably have the largest customer base compared to other online banks, they are still leaders, and people pay attention to what they do.

HSBC Direct was paying attention, and following ING Direct’s drop this bank lowered its rates from 5.05% to 4.5% APY, a steeper drop than ING’s.

As I was updating the list of high-yield savings interest rates for the site yesterday, I noticed that Emigrant Direct has followed suit. This bank, a branch of the Emigrant Savings Bank based in New York, dropped its offered interest rate (yield) from 5.05% to 4.75%. This 30 basis point decrease is larger than ING Direct’s but not as steep as HSBC Direct’s.

Which banks will be next to follow suit? I don’t think we’ve seen the last of lowered savings rates.

In related news, NetBank, also one of the first online banks, has failed and has been taken over by ING Direct. ING Direct has more information for former NetBank customers.

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New Students Get Student Loan Relief

by Luke Landes

A bill that was signed into law will help emerging students pay for the cost of their education. There are several facets to the new law, so here’s a summary.

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Weekly Roundup, Redesign Edition

by Luke Landes

As you may have noticed, we’ve been undertaking a redesign at Consumerism Commentary, with the intent of reducing clutter. Feel free to leave any comments, particularly if there is any features that no longer work for you. Here are a few articles I’ve read from the MoneyBlogNetwork and beyond this past week: Index Funds Plus ... Continue reading this article…

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Account Watchers and Account Ignorers Anonymous, Meet Mint

by Sasha

A review of Mint.com follows. Seven years ago, you would have found me blissfully unaware of my spending practices and their impact, flourishing my credit card without a second thought as I ran up my tab at restaurants and shops. I defined living life fully as having the things and experiences I desired, and I ... Continue reading this article…

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More $4 Generic Drugs at Wal-Mart

by Luke Landes

About a year ago, Wal-Mart announced the store would be offering generic prescription drugs at prices a fraction of what you can get in other pharmacies, and that caught my attention.

3 comments Read the full article →

10 Tips for Buying a Residential Rental Property, Part 10: Utilities Can Use You Up

by Sasha

This is the last tip in a 10-part series on purchasing residential rental properties based on my experience. 10. Utilities can use you up, so be careful. Utilities can be a major issue for landlords if not set up properly. If you supply utilities to your tenants, you are generally not permitted to terminate these ... Continue reading this article…

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Good News, Everyone!

by Luke Landes

I have migrated Consumerism Commentary to a new server. For those who are interested, I will be writing an article on the server move. Look for that on Meta Best Blog Win, a blog about blogging.

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Another One Bites The Dust: HSBC Direct Lowers Interest Rate

by Luke Landes

HSBC Direct is the next bank to drop its savings interest rate. There are still a few options over 5.0 percent APY out there, though.

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How Many Earths Would it Take to Sustain You?

by Luke Landes

If everyone on Earth lived like me, it would take more than 7 Earths to support our world’s lifestyle. A new game from NPR gives you an idea of how difficult it would be to support a world where everyone lives like you.

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An Education in High Definition for the Novice

by Luke Landes

Best Buy is campaigning for better consumer education in High Definition to prevent store returns. Customers apparently purchase flat screen televisions and expect the complete high definition experience immediately upon hooking up their system with the same old equipment and cables. Despite the lack of knowledge, I don’t think an entire “education program” is necessary. ... Continue reading this article…

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Guide to CitiBank Credit Cards

by Luke Landes

Every so often, I’ve been going through some of the more popular credit card issuers and presenting a list of their credit cards, highlighting some of the better programs for rewards. So far, I’ve looked at the best credit cards from American Express and Capital One. Credit cards can be dangerous tools in the wrong ... Continue reading this article…

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10 Tips for Buying a Residential Rental Property, Part 9: Bigger Is Not Always Better

by Sasha

This is the ninth tip in a 10-part series on purchasing residential rental properties based on my experience. 9. Bigger is not always better. As your property size and square footage help to determine your tax rate, an acre or more of land really isn’t necessary. You’ll mow it (or pay to mow it) and ... Continue reading this article…

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Two Nice Surprises for a Friday

by Luke Landes

For being such a wonderful customer, Verizon Wireless is offering me the chance to increase my talking habits in turn to increase the chance I’ll go over my plan’s limit and pay for excess “overage.” Yes, they sent me a reward of 100 free anytime minutes, which I will retrieve from a special website for ... Continue reading this article…

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Weekly Roundup, Jogging Edition

by Luke Landes

The first spin-off from my original personal blog was a blog in which my roommate and I chronicled our adventures in physical exercise through jogging, about 7 years ago. I’ve finally gotten up off my butt again. Each day this week, I’ve been taking laps around my apartment complex after work. Actually, I missed Wednesday ... Continue reading this article…

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Financial Advisers and Stock Brokers: What’s the Difference?

by Luke Landes

You would think that the roles and responsibilities would be clear and there would be a strong line between individuals who call themselves financial advisers and those who call themselves stock brokers. The obvious answer is that advisers give impartial advice based on the best interest of the client and brokers sell products as a ... Continue reading this article…

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Financial Curriculum: Classes About Money Management

by Luke Landes

Earlier this year, I shared my opinion that personal finance classes should not be required in high school thanks to an overloaded general curriculum and dubious results. My opinion is that basic money management is better taught — if in school at all — in the earlier years. The Citi Foundation sponsors a financial education ... Continue reading this article…

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ING Direct Drops Interest Rate From 4.5% to 4.3% APY

by Luke Landes

ING Direct hasn’t been the interest rate leader in years. In a world where some banks are offering yields above 5 percent on money market or savings accounts, ING Direct sat squarely at 4.5 percent. Nevertheless, I still have the bulk of my savings there. I am too lazy to chase around for the highest rates every ... Continue reading this article…

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