Thursday, October 29, 2009

TIPS to the Rescue!


U.S. BANK CHECKING ACCOUNT ADVANCE


If eligible, you may borrow between $20 and your available credit limit. If your checking account is overdrawn, you must borrow enough to bring your checking account balance to a least a $0 balance.

The finance charge is $2 for every $20 borrowed. This is an Annual Percentage Rate (APR) of 120%.


Wow!

It all started with a mistake I made this week. My property tax bill is coming up and although I had plenty in my checking account to cover it, I opted to transfer a bit more money over from an online account at another bank as an extra buffer. Call me paranoid but I don't like running with low balances. All it takes is one excess banking fee to turn free checking into something quite expensive.

Being one of those careful double-checking types, I called my bank's automated system today to see how much money I had available before cutting the property tax check. It was FAR less than I knew it should be. It took me all of 5 seconds to figure out what I had done.

I mistakenly transferred the money the wrong way! Rather than put additional money in to serve as a buffer, I actually yanked out my previous buffer and a whole lot more. D'oh!

This brought me to the next startling fright. It is the Halloween season and more tricks were clearly on the way. My balance should be negative. If not now, it soon will be.

I then called customer service and asked what my options were. I've never actually had a check bounce and figured there might still be time to head it off.

He offered me $500 at a 120% annual interest rate. Gee, thanks! With friends like that, who needs enemies? Another option he offered was to do nothing and let the fees pile up as checks began to bounce (he worded it in a much friendlier way). I ended that conversation and decided to dig further on why my account actually was not negative already. Maybe I could hit the problem from the other end.

That's where TIPS came in. Thank you US Government. You deposited interest in my checking account on October 15th (one day after the period my last bank statement covered). Saved by a timing miracle!

I'm not completely out of the woods yet, but at least I have more control over where this goes. At least I won't be bouncing checks. Whew!

I immediately transferred more money from my online account to my brick and mortar bank. Time is not on my side though. The property tax check must be postmarked by October 31st. I'm hoping that I can see the money show up in my US Bank account by Saturday AND get confirmation from my bank that they won't put a hold on the funds. I'm fairly confident I can get the latter if I arrive in person and explain it. I've had some practice at it over the years (mostly when moving money to buy I-Bonds). Persistence and a good credit record goes a long way.

I may need to pay my property taxes late though, depending on how it goes. I'm certainly not guaranteed success. Regardless, it is far better than bouncing checks and/or paying 120% interest rates though. Paying a month late should cost me just over $30. I'm hoping it doesn't come to that, but at least I miraculously managed to fend off at least some of the pain (blind luck).

And lastly, I want to point you to something my bank statement used to say on it (but says no longer).

Summary of Your U.S. Bank Relationship

What happened to our relationship? Was it something I said? Why are you offering me 120% interest rate loans? You seem so cold and distant these days.




I am once again reminded of the economic pain that millions of people go through each and every month in this country. I had money but simply had it in the wrong place. There are many who simply don't have the money at all. The banking system is there for them, much like the loan sharks of the past.

As Cobleigh explains, "The real aim of loan sharks is to keep their customers eternally in debt so that interest (for the sharks) becomes almost an annuity."

18 comments:

mab said...

Stag,

"The real aim of loan sharks is to keep their customers eternally in debt so that interest (for the sharks) becomes almost an annuity."

The only way to make the loan shark gig better is to have the debt annuity backstopped by the U.S. Government. It's a good thing our Government is strongly against usury.

EconomicDisconnect said...

Mark,
what happened to all that gamer invention royalty cash? We all know you invented Halo 3!

Seriously, you have to watch the banking stuff now more than ever, they are trying everything to tack on penalties and fees and unless it is a very small bank they could care less that you are mad.

Halloween Horror film contest up later, win a prize!

mab said...

Stag,

My word verification was "hosit". That's reminds me of the Canadian term "hoser" which goes back to the pre-Zamboni hockey days:

http://www.youtube.com/watch?v=hdf4GeT4ELA

EconomicDisconnect said...

Hoser, wasn't that used in the film "Strange Brew"?
http://en.wikipedia.org/wiki/Strange_Brew

awesome.

Best Canada themed film ever, Rob Lowe in "Youngblood"!
http://en.wikipedia.org/wiki/Youngblood_(1986_film)

watchtower said...

"This is an Annual Percentage Rate (APR) of 120%."

I'd be glancing over the fine print looking for the words 'penalty' and 'kneecapped'.

watchtower said...

I should have known you invented 'Halo 3', how else could someone accumulate that much toilet paper?

EconomicDisconnect said...

Watchtower,
LMAO!

For the record, I was kidding, I have no idea if Mark invented Halo 3!

watchtower said...

GYSC
Yeah I knew you were kidding, I just couldn't resist : )

But seriously, how did Mark come up with that much toilet paper?

EconomicDisconnect said...

He pulled it out of his......

Kidding! We luv you mark!

Stagflationary Mark said...

Hey guys!

Thanks for all the comments today. I've been out and about all day and only got 2 hours sleep last night. I have no tolerance for stress any longer, especially financial stress of my own creation. Your comments really cheered me up (even the depressing ones, lol).

So here's the latest.

I now have more options.

First, since the 31st falls on a weekend, I just found out I have until November 2nd to pay my property taxes. The money MIGHT be in my checking account by then and I MIGHT have access to it.

I also have an additional choice. They accept credit cards with a 2.5% fee. I may do this just to avoid the dreaded "delinquency" word. I really don't want to be part of the problem. My delinquency could be the straw that broke the economy's back so to speak. How would I live with the guilt?

That said, delinquency is cheaper. I can simply pay late for a 1% interest penalty. It will cost me about $30 to pay late. It will cost me $80 to avoid the delinquency word. I really shouldn't need credit again in my lifetime, but you never know. Decisions, decisions.

In other news...

I did NOT invent Halo 3. Hahaha! I will share this though. My best claim to fame would be as the the lead software engineer on...

The Lost Mind of Dr. Brain

There were 10 puzzle games within it and the following was one of the ones that I worked on specifically. I'm fascinated to see his thought process at working through the puzzles.

http://www.youtube.com/watch?v=xqDGPYMcWGk

On the hardest difficulty level, they can be almost insanely difficult. He doesn't show them in the video. They were far easier to make than solve. I'd write what I thought was some amusing code, THEN put the puzzle together that used that code. Those that solve the puzzle must do the work in reverse. Not easy!

We did that product in less than 9 months (faster than a pregnancy!). It shipped on time and on budget. It was released simultaneously in three different languages (English, French, and German). It was also released simultaneously on two different platforms (Mac & PC). It was shipped with no known bugs and never required a patch (although it might now, who knows if can still run on today's machines!). It ranked #1 in Consumer Reports for the 1995 Christmas Season in its category and actually won a Software Publishers Assocation award (CODIE) for "Best Home Learning Program for Adolescents". This prompted the founder of the company who hired me to form a tear in his eye. No joke!

That said, corporate management felt it was a C+ product. They told us as much when it shipped. Further, they held it up to put a demo of some other product on it. Consumer Reports begged to differ though, lol. In fact, since the product was delayed due to the "need" to put a demo on it, there was a serious shortage in stores. People were actually fighting over the few copies that were available. Doesn't that just figure? As the positive reviews kept piling in, we formed a sarcastic "wall of shame" in our hallway. Each new article of praise was tacked to the wall. Good times!

That isn't what retired me though (due to the massive accounting fraud within our company, see "Cendant" for details). Fortunately, I had two other backup plans for early retirement. One of those hit pay dirt. The other was my 401k, lol.

http://en.wikipedia.org/wiki/Wizards_of_the_Coast

"Wizards of the Coast was founded by Peter Adkison in 1990 just outside Seattle, Washington, and its headquarters is still in nearby Renton."

"Seeing the continued success of Pokémon and Magic: The Gathering, the game and toy giant Hasbro bought Wizards of the Coast in September 1999, for about US$325 million."

I was a fairly small shareholder, but big enough apparently! I can say that the best financial decision I ever made was continuing to drive the car I didn't like (Hyundai) so that I could invest the difference.

mab said...

Stag,

Yesterday, President Obama proudly claimed that the $787 billion stimulus had created 650 thousand jobs. Not to be outdone, Vice President Biden added that the stimulus had also created a $140 billion dollar year-end Wall St. bonus pool. ;)

Stagflationary Mark said...

mab,

"Yesterday, President Obama proudly claimed that the $787 billion stimulus had created 650 thousand jobs."

650k jobs paying $100k per year for one full decade would only cost $650 billion. Assuming the jobs created are THAT well paying AND will still exist without future stimulus (HUGE assumptions), then where's the missing money?

"Not to be outdone, Vice President Biden added that the stimulus had also created a $140 billion dollar year-end Wall St. bonus pool. ;)"

Whew! Thought there was a problem with my "cartoon economics" math! ;)

AllanF said...

Hey Mark,

Your game looked pretty neat.

"I'd write what I thought was some amusing code, THEN put the puzzle together that used that code. Those that solve the puzzle must do the work in reverse. Not easy!"

Hey that sounds like a lot of "customer code" I've had the pleasure of dealing with over the years. I wrote embedded controls. Absolutely nothing worse than an EE writing self-taught C. OK, an ME writing self-taught C.

I did car radios, engine and transmission controls, all that good stuff. My claim to fame was lead sw engineer for GM Quadrasteer. It was steer-by-wire for the rear wheels of a pick-up truck. The rear angle was a function of speed and front wheel angle. At low speeds the rear wheels turned opposite for better parking lot maneuverability. At high speeds the rear wheels turned the same for better handling, especially with a heavy trailer. I think the potential product liability kept GM from really pushing it for wide-spread adoption. It made a huge difference in maneuverability and handling though. Anyone that drove it was amazed and in love. It would have been perfect for soccer mom's back when SUV's were the rage. It was a fun project, and I always wished I could have had one. Though now that I've moved to the city I have no idea what I'd do with a full size pick-up.

mab said...

Stag,

http://www.bloomberg.com/apps/news?pid=20601039&sid=aHU4bso2L2aE

Assets are worth way less than many people think. With wages and rents deflating, they'll be worth even less in the future.

The Titanic is listing.

Stagflationary Mark said...

AllanF,

My first task after being hired at the company was taking over a product that was just about ready to ship. Nothing scarier in all of programming than being responsible for someone else's code.

This was especially true in this case. The graphics engine was a bit buggy and the former programmer knew it. The comments said, and I quote...

"If I had the right font I'd draw a pentagram here."

No joke! That code actually shipped though. There were other systemic problems much bigger to fix, much like the US Banking System. As an example, the programmer wasn't aware that memory allocated on a Mac was able to move. This led to all sorts of instability that I needed to fix.

It could have been worse though. The code was generally well structured and easy to follow (not "spaghetti" code).

Stagflationary Mark said...

mab,

"The Titanic is listing."

Slap some wheels on it, place it in a California mobile home park, and "list" it as the steal of the century. Don't forget to mention the first time home buyer tax credit!

EconomicDisconnect said...

Re TIPS,
I have a kitchen TIPS for all:
"Don't Fry Bacon Naked"
Words to live by.

Stagflationary Mark said...

Sent off the property tax check today. The money apparently made it to my checking account in time.

"Your current and available balance is..."

Whew!