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.

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]

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.

1. Get Rich Slowly
2. The Simple Dollar
3. Blueprint for Financial Prosperity
4. MoneyBlogNetwork Home
5. AllFinancialMatters
6. FiveCentNickel
7. Free Money Finance
8. Consumerist
9. No Credit Needed

1. pfblogs.org

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

2. 5 Romantic Outdoor Day Date Ideas Under $30
3. ING Direct Drops Interest Rate From 4.5% to 4.3% APY
4. The Declining Value of the MBA
5. Intuit Quicken 2008 is Here
6. Guide to Capital One Credit Cards
7. Personal Balance Sheet, August 2007 ($107,488, +6.3%)
8. How Many Earths Would it Take to Sustain You?
9. Financial Advisers and Stock Broker’s: What’s the Difference?
10. Bank of America Raises ATM Fees: How Do You Avoid?

1. 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.

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.

Yesterday, 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 of the major talking points.

The maximum Pell Grant, which is awarded to students based on financial need, will increase from $4,310 to $5,400 per year over the next five years, starting with $4,800 next year.

20 years ago, a Pell Grant would cover 60% of the average public university tuition cost.

The interest rate for subsidized Stafford loans is dropping to 3.4% over the next four years. If you qualify for a subsidized Stafford loan, the government pays the loan’s interest for you while you are in school. The new law has no effect on unsubsidized Stafford loans.

Struggling graduates can benefit from a new formula to determine their repayment schedule. If you qualify, your lower payments will be based on 15% of your annual discretionary income. This applies to private loans as well, not just government loans.

If you plan on teaching and commit to the profession for at least four years, you can qualify for an additional $4,000 a year in grant money. These grants will revert to loans for anyone who gives up on the education industry.

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 a few Stocks Works for Me. FMF keeps it simple with his investing strategy. This is similar to mine, as well, but my stocks are not performing as nice as I’d like.

Thoughts on Maxed Out. Mighty Bargain Hunter shares his thoughts on the documentary. It’s easy to get into debt problems, but difficult to get out. MBH says the key is preparation.

Words of Wisdom From Alan Greenspan. Five Cent Nickel took notes during the former Fed chief’s appearance on The Today Show. In short, he’s worried about the credit crunch, but he doesn’t believe we’re heading to a recession.

8 Personal Finance Lessons I Learned From Monopoly. Jim from Blueprint for Financial Prosperity has some ideas about how the old game can be linked to personal finance.

Illustrated Debt Snowball. No Credit Needed includes some charts that help visualize how the debt snowball technique worse. The traditional debt snowball (highest balances first) is not the most efficient way of getting out of debt. See 6 Steps to Building a Better Snowball.

Using Quicken to Analyze and Correct Bad Spending Habits. Get Rich Slowly used his software to motivate him to spend less on comics.

A Preview of the 2008 Federal Income Tax Brackets. AllFinancialMatters is way ahead of the game. I haven’t started by 2007 taxes yet.

Using Music to Teach About Money. Alpha Consumer interviews Benjamin Chavis, president of Hip-Hop Summit Action Network, about their program to inspire healthy money management skills in today’s youth.

Have a great weekend!

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 thoroughly enjoyed myself, imagining that I could travel anywhere and do anything I liked.

There was a catch, though. Only through intentional ignorance could I stand to keep it up, refusing to look my finances straight in the wallet. When I was confronted with bills I’d flinch, pay what I could, and hope to straighten things out later.

It was a frightening day when I finally faced my situation. During such “rich” living, I’d not realized the weight that my debt added onto my life. I was tipping the scales way out of balance, and the only way to even begin to fix things was to gather my finances and face the situation head-on.

Now, I watch my finances daily, with a slight degree of paranoia. I suspect that any moment I’m not paying attention, a spending mishap or stock fluctuation will sneak in and alter my financial landscape. I am obsessed with a constant need to know where I stand against my goals, planning strategies and swelling with pride at every small stride forward. I thrive as I watch my debt dwindle.

Besides my mindset, my biggest obstacle to financial awareness was my hatred of math. There, I’ve said it. I despise balancing checkbooks, tallying accounts, and performing almost any analysis involving a calculator. And though I’m starting to get to know them better, balance sheets, cash flows, and other documents which look like corporate financials make my eyes glaze over.

I have outlined my own budget and expenses several hundred times in Excel, only to find I never want to look at them again. It’s just how I am.

While I had high hopes for MS Money and Quicken, I found them to be expensive and somewhat burdensome to work with. I spent hours categorizing things only to realize that I didn’t have the time at home to keep it up, nor did I find the reports all that helpful.

I kept wanting it to be simpler, clearer, cheaper. My finances at a glance, in one place, but accessible online from anywhere without needing to remember scores of passwords.

I found this to some degree in Yodlee’s account aggregation, encountering the service first as Wachovia’s “One Stop” and then as Fidelity’s “Full View”. Some use Yodlee MoneyCenter directly, I’ve heard, but I always access their services via one of my account providers.

Though the service can look and work differently based on implementation, it’s relatively simple. Essentially, there’s a one-time setup phase, where you add your accounts, and then each day you log in and refresh your data to view a snapshot of exactly where you stand financially.

Bank accounts, loans, brokerage, credit cards, 401K and other investments tally up to a neat net worth, with transaction information easily accessible. Even insurance, frequent flyer miles and my billpay service can be added to this view. I set it up once, and now log in every day, sometimes two or three times a day. I told you it’s an obsession.

The problem? It’s great to get such a high-level at-a-glance view, but it hasn’t grown with my needs. There are no analytical tools, no way to categorize and tag items and get different views or reports of the information presented or any helpful tips to improve my situation.

Until Mint, that is. Launched last week, this free online money management service features the security and ease-of-use of the Yodlee platform with a host of simple yet effective tools for categorizing, analyzing and ultimately improving one’s relationship with money.

Their web site makes some impressive claims:

Mint is the freshest, most intelligent way for you to manage your money online. Not only is Mint free, it saves you money. While existing personal finance software “solutions” require hours to set up, a passion for accounting (is that possible?) and hours of weekly maintenance, Mint is virtually effortless.

Can it be true? Can it really save you money? Most importantly, can it save me from the things I most dread, mathematics and accounting?

I’ve been beta testing their service for a few months now, and have formed some strong opinions so far. So, let me introduce you to Mint.

I’m quick to admit I am not a fan of Wal-Mart. Whenever I enter the store, no matter what time of day, the place is a zoo. There are too many people, the merchandise is all over the floor, there aren’t enough cashiers, and everyone is rude.

I would this write this off as pertaining to the location of the store, but it has been the same in every Wal-Mart I have ever dared to shop. The poor experience for me isn’t worth the prices, which are sometimes lower than Target or the supermarket, but not often enough for me to risk being annoyed. (Also, there’s no Wal-Mart location that is convenient to me anymore.)

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. This year, they are expanding the program.

They are offering a number of prescription drugs for $4 for a 30-day supply, while birth control products are $9. The store is considering offering the $4 drugs at a steeper discount for a 90-day supply, as well.

Generic drugs are almost always as effective as their name-brand equivalents. For someone who needs prescription drugs, this program, in which more than 300 generic prescription are included, could be a strong enough incentive to brave the aisles.

Photo credit: Hvnly