Tag Archives: ING Direct

Two bank accounts = too much confusion

When I first switched to my ING checking account, I absolutely loved it. I still love my checking account with them. But we are finally experiencing some of the confusion I feared when we made the switch.

Because ING Direct is an electronic bank, our account must be linked to a brick and mortar bank. This allows us to cash and write paper checks. Aside from the occasional birthday check from my grandma, we rarely cash paper checks. Unfortunately, though, because of the timing of my husband’s paycheck and the way that ING’s paper check mailing process works, we still use our brick and mortar bank to write our rent check.

It’s been relatively easy for the past several months. Tony’s monthly paycheck is split up — the rent money is automatically deposited into our brick and mortar bank on the last day of the month, and the rest of his paycheck goes into our ING account. We write the rent check, give it to the landlord, and everything is fine.

This month I made a mistake, though. A few of our online bill pay accounts still have the account information from our brick and mortar bank. I must have selected that account accidentally when I paid a bill at the end of the month, because $100 of our rent money was deducted from the bank before the rent check cleared.

When I logged in to see if the rent check had cleared on the 2nd, I realized there wasn’t enough money to cover the rent. If the check cleared without enough money, we’d have to pay a $25 returned check fee.

It takes two business days to transfer money from ING to the brick and mortar bank, so there wasn’t enough time to transfer money in order to avoid a bounced check.

Luckily, I caught the mistake in time to make a cash deposit at the brick and mortar bank. Because the check hadn’t cleared yet, I was able to deposit cash into the account and avoid a returned check fee. The check cleared at midnight on Feb. 2 without a problem.

I learned a few lessons from this headache. First of all, I removed our brick and mortar account information from all of our online bill pay accounts to avoid selecting it accidentally again. From now on, I’ll also be checking our brick and mortar account to make sure I haven’t made any mistakes before I turn in the rent check.

This is the second big mistake I’ve made in as many months. Last month, I actually forgot to pay a bill (a first for me), and we ended up paying a late fee. I don’t know what’s up with me lately, but the biggest lesson I learned from this? I need to get on the ball. I don’t know if it’s stress from all the planning and changes ahead or what, but my lack of focus could end up costing us if I’m not more careful.

Photo by potteryandeverythingelse

Save instead of spending this Black Friday

Open an ING checking account today, and you’ll get a $121 bonus!

If you’ve been thinking about trying this great online bank, now is the best time. I’ve written before about just how happy I am using ING as my primary bank. They offer some of the best interest rates out there, and the customer service is phenomenal. Here’s how to take advantage of this deal:

  • Open a checking account today and use the promo code EOSAVE
  • Use your new debit card to make 3 purchases in the first 45 days of your account. Do not debit these transactions. Make sure you run it as a credit and sign for it.
  • On the 50th day, your bonus will be automatically deposited into your account.

If you decide to open a new account and make an initial deposit of at least $250, would you use one of my referral links below? I’ll get a $10 bonus for letting you know about this great deal!

Start saving now!

Start saving now!

Start saving now!

Start saving now!

Start saving now!

Happy deal hunting today! I’ll be cozy at home avoiding all the madness. :)

Our emergency fund is complete!

emergency fundTake a look at the progress bars in my sidebar! We’ve completed our emergency fund in just about 15 months and it feels FANTASTIC! Over the past year, we’ve saved about 30% of our income. Not too bad, huh?

We weren’t projected to complete it until next month, but I went ahead and moved some of our Europe fund into our Emergency fund to finish it up. Now we can focus on funding one savings account.

Over the weekend, we stashed our emergency fund in an ING 12-month CD. The interest rate on our ING Direct savings account has been steadily dropping since we opened the account. We started with a 3% interest rate, and about 15 months later it’s down to 1.3% and still dropping. With the CD, we lock in a 2.1% interest rate for 12 months.

I know what you’re going to say. Isn’t the Emergency fund supposed to be liquid savings? Doesn’t a CD smack you with penalties for early withdrawal? Well, here’s the thing: The penalty for early withdrawal is 3 months of interest regardless of when we withdraw. So the penalty is the same if we withdraw tomorrow or 11 months from now. If we leave the money alone for 12 months, we’ll earn at least an additional $80 in interest. Worst case scenario, we have a catastrophe and we have to withdraw early. If that happens, we’ll lose a little of that extra interest.

Based on my calculations, 3 months of interest would equal about $20. So even if we withdraw early, we’ll still make about $60 more with the CD than our regular savings account (and that’s if our savings interest rate doesn’t continue to decrease, which is unlikely).

If we run into a little hiccup that requires us to move some money out of savings, we could always borrow from the Europe fund, which is still in a regular savings account, without any penalties.

The way I see it, if we have to withdraw from our CD a little early to cover our car insurance deductible, for instance, then so be it. We’ve really got nothing to lose. We’ll give up a little of that extra interest. So what? The money is still accessible in the event of an emergency, and we’re not technically losing money that we invested. Just interest, which would be fine with me if it was a true emergency.

Another reason we made the decision to open the CD is to protect our savings. Now that we’re banking primarily with ING, it’s a little too easy to move savings into our checking account. I wanted an added layer of deterrent for us to leave it alone now. There’s no way I’m giving up 3 months of interest just because I want to buy something.

This is our second milestone (the first was paying off all of our credit card debt), and it FEELS GREAT. When we first started our emergency fund, I felt so overwhelmed. Our budget was so tight, how could we manage to save such a large amount of money? But I have to tell you, it is so worth the scrimping. Since I opened our emergency fund, I’ve turned into a savings junkie. I love the feeling of looking at our account, and feeling secure in the knowledge that we can handle anything that life throws our way. It’s so empowering.

If you haven’t opened an emergency fund yet, why don’t to grab one of my referral links and get started? :)

Photo by endlessstudio

Using ING as our primary bank

INGYesterday, I wrote about our money management dilemma: when we keep extra money in our checking account, we’re more likely to overspend, but without a cushion we’re vulnerable to overdraft fees. We only keep enough money in checking to cover our living expenses, so I’d like a safety net to avoid fees if I make a mistake.

We considered opening an additional savings account with our primary bank to use as overdraft protection. Unfortunately, our brick and mortar bank requires a minimum savings balance that’s higher than I want to keep there considering the low interest rate.

Instead, we’re switching to ING Direct as our primary checking account. My ING checking account is attached to a line of credit that serves as overdraft protection. If I miscalculate and overdraft my account, money will automatically be transferred from my line of credit to cover it. I’ll be charged a low interest rate on the money I’m borrowing until I replace it.

Because my emergency fund is linked to my ING checking account, I’ll be able to immediately transfer money into my checking account to avoid paying interest. There are no fees for the transfer, just the interest rate until the money is paid back. Since it’s highly unlikely that I would overdraft my account at all, let alone more than a few dollars, this is a great solution for us.

Most of our bills are paid electronically, so an electronic checking account won’t cause a problem. The only problem is our rent. Our leasing agent requires a paper check, and we often don’t have enough in our checking account to pay it until my husband is paid on the last day of the month, but it takes 5-7 days to mail a check.

Our solution is simple: the rent comes out of my husband’s paycheck every month. When my husband updated his direct deposit information, he set it up so that the rent money will go into our brick and mortar bank and the rest of his paycheck will go into ING. That way we can write a check and pay the rent from our brick and mortar bank on the day he’s paid without having to move money around or wait on a paper check to be mailed.

I’ve written before about my hesitance to switch to ING for primary checking, but after some research I discovered a few things:

  • There is nothing a brick and mortar bank can do that ING can’t do. The only difference is the delay in sending checks, but it’s completely free to do so.
  • Their customer service hours are better than most banks. Representatives are available 8 a.m. to 8 p.m., 7 days a week. Based on my own experience, they’re always very helpful and courteous.
  • We’ll earn a little interest on our checking account. It’s only 0.25%, but hey, that’s better than 0%.
  • ING is FDIC insured, so our money is safe.
  • There are no fees for cash withdrawals at AllPoint ATMs.

I updated our account information for all of the bills that are automatically drafted from our checking, and changed our account information for direct deposit of our paychecks. I moved most of the money over to ING, and once everything clears, I’ll move the rest. I’ll let you know how it goes!

Interested in opening an ING account? Use one of my affiliate links and make an initial deposit of $250 or more, and you’ll get a $25 bonus! I’ll get a $10 kickback for telling you about it. :)

Note: This bonus also applies to savings accounts. ING Direct has some of the best savings accounts around with no minimum balance, an interest rate of 1.3%, and easy account management that allows you to open several separate sub-accounts for separate savings goals.

Open an ING account

Open an ING account

Open an ING account

Open an ING account

Open an ING account

These referral links are good for only one account, so if the first link doesn’t work, move on to the next one or contact me and I’ll send you a valid link!