by Matthew Perry
(last updated February 21, 2009)
It's a fad! It's a scam! It's the wave of the future! It's...Internet Banking! I have to admit something: I do all of my banking online. I haven't set foot in a bank in more than a year, and I'm incredibly happy about that. That means I'm also happy for the chance to extol the many virtues of internet banking, as well as making you aware of a few minor drawbacks.
Awesome Feature #1: You can do it without leaving our comfy home; all you need is a computer and an internet connection. This is particularly important for people who belong to small banks or credit unions. If your institution has online banking options, you don't need to feel tethered to your area because it has the only branch for fifty miles. You can do your banking from Jamaica as easily as Montana.
Kinda-drawback #1: If you like using cash or need to conduct business with someone that doesn't accept debit cards, one possible disadvantage of online banking can be that, depending on the bank you choose, there may not be many (or any) ATMs available. The fees for using other bank's ATMs can add up quickly if you're not paying attention. If you use ATMs a lot, you may want to look for a program that doesn't charge for ATM withdrawals or includes ATM rebates.
Awesome Feature #2: Online banking is almost always cheaper. Since online customers reduce the need for branches and employees, banks save money and can offer higher interest rates and fewer fees to their customers. While the difference in pricing between wholly online banks and physical banks is much smaller than it once was, you can still see it.
Kinda-drawback#2: Banking online does require you to store your banking information online, and some people feel uncomfortable with that. However, most online banks have very strict protection on their systems to prevent hacking, including requirements for password and username length (which makes it more difficult for machines to generate the correct combination), security questions (you can select questions that only you know the answer to, like "Who was your first love?"), and automatically logging you out if you leave your computer unattended for too long.
Awesome Feature #3: Banking through the internet makes it very easy to keep track of your finances. All of your transactions are recorded and viewable at any time, so you can keep track not only of how much money is in your account, but how you spend it. It's easy to export your records to budgeting or tax programs, saving you a lot of hassle and reducing the chances for human error to sneak into your records.
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