This week should have been a vacation.
It has been, for the most part, but not entirely. While I’ve traveled occasionally over the past few years, and even chosen destinations meant for relaxation and time alone with loved ones, I haven’t had one of those fabled true vacations. My cell phone was still near by. I still took business-related calls. I still wrote for Consumerism Commentary every day, participated in discussions, and replied to emails, every day while not home.
Perhaps working for myself is a benefit and a curse — I make my own schedule but I feel compelled to take care of my responsibilities, at least some of them, even when I should b allowing myself to forget about work.
I had planned to change that this week. After visiting my family in southern California, a week-long detour to San Francisco with my girlfriend should be something to keep me away from working. We’re having a great time, but without enough planning in advance and with other business-related responsibilities requiring my attention, it hasn’t been the complete escape from reality I had in mind.
While my own vacation may not be a true escape, my financial attentiveness has seemed to have been more successful at leaving the world behind. In the past two days I discovered I made some annoying errors with the management of my accounts.
1. I didn’t verify Wells Fargo closed my old business accounts.
A year after I sold most of my business, I finished up accounting and began the process of closing my business bank accounts. At least, I thought I did. I visited my local Wells Fargo branch in January to close my old accounts and open new accounts for my new business. The banking representative at the branch transferred the residual balances out of the accounts, and I thought I had taken care of everything.
When I checked my account online this month, I noticed the old, supposedly-closed accounts were still listed, and I had been charged a monthly maintenance fee. By transferring my balances out, I was left with an account with a zero balance, below the minimum balance required to avoid monthly fees. Because the accounts were still in existence, for whatever reason, I was charged this small fee, and my account balance had dipped below zero.
I called the bank’s customer service department for business accounts late one night recently. They were able to see that the accounts should have been closed in January. The bank kindly reversed the monthly fee that should never had been charged, and we both verified that the accounts were now closed.
At the same time, I forfeited the six cents of interest that had accumulated in my business savings account during the month of January. Had I wanted to transfer that remaining balance to my personal account, it would have taken another day and another phone call. I quickly decided it wasn’t worth the effort.
I wasn’t able to avoid all fees. After I took care of the above problem, I realized that I had been charged a small monthly maintenance fee in my new business account. When I created the new accounts for the business, I discussed with the representative in the branch the requirements for avoiding monthly service charges. The account I chose requires either a $150 recurring automatic transfer or a minimum average daily balance of $500. This is where my memory becomes hazy: I thought the representative set up the recurring transfer for me.
My mistake was mot verifying this after the fact. When I noticed my mistake, I transferred cash into the business account to cover the minimum average daily balance requirement, but not without incurring one monthly service charge.
2. I didn’t have a large enough balance in my Capital One 360 checking account to cover my credit card payment!
My finances used to be simple: my income was deposited from various sources into a business checking account, an amount was transferred to a personal account to represent my paycheck, and this amount would cover my expenses each month, most of which are paid on a credit card that earns miles.
My financial situation has changed, and I use different accounts now. That means I have to remember to fund my personal checking account with the right amount each month. And I’ve allowed myself to keep my finances automated for so long that I might forget these tasks. Chase, as one would expect as the credit issuer, makes things difficult.
- My automatic credit card payment bounced, which I knew before Chase “knew.” It took a day or two for Chase to recognize that the automated payment would not go through.
- In that interim period, I wanted to make the full payment from a different account — a checking account held at Chase, which had already been linked to my credit card for use as a payment method. Chase would not permit me to make the full payment because if the first, automated payment had gone through, the remaining balance on my credit card would only include charges since the last bill, and Chase doesn’t let credit card users “overpay” their bills. In my case, it wouldn’t be an overpayment because I knew the automated payment would not go through, but Chase didn’t “know” that yet.
- Once Chase recognized the response from Capital One 360 rejecting the automated payment request, I was able to schedule a new payment. I had already scheduled a smaller payment to cover the charges since the last bill, but I wanted to make sure my card balance was paid in full as soon as possible. Chase, for an unknown reason, does not allow two payments within three days of each other. I say the reason is unknown, but I know there is a purpose — to ensure that situations like these don’t happen without Chase earning some money in interest or late fees.
While these recent events haven’t cost me much money in the long run, it has been a wake-up call. In my attempts to simplify my finances, and due to the reduction of my need to look at my accounts on a daily basis, I’ve let certain things slip. I’ve taken too much of a vacation from managing my finances in a responsible manner.
Years ago I warned about the dangers of automating your finances. I set up a good system, and it worked for me well until my circumstances changed and I began throwing wrenches into the works without making sure everything was still working properly, like a well-oiled machine. The damage wasn’t excessive, but it was annoying, so now it’s time to re-evaluate my financial system, make changes and enhancements to make sure nothing falls through the cracks, and begin, once again, monitoring my money a little more closely.
Mistakes happen to everyone. It could be worse; a small-time writer like myself who pays a few extra fees is nothing compared to a financial planner, popular author, and columnist for The New York Times who lost a his house. At the risk of seeping into alliterative reductionism, the best approach to take when facing unfavorable outcomes is to accept, analyze, and adjust.
With these financial fires extinguished, I can get back to enjoying my vacation in San Francisco despite the occasional turn to a focus on business while everyone else is asleep.