Lazy Man and Money

Savings and Checking Made Easy with Radius Bank’s Hybrid Account

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Years ago, I created this website with the tagline, “Making my money work, so I don’t have to.” I noticed that due to compound interest and living below my means, the choices I made in my early 20s had paid off handsomely by the time I turned 30. Those choices weren’t anything special, just basic ones such as maxing out my Roth IRA and 401k.

This idea of working smarter instead of working harder that lead me to create the “Lazy Man and Money” website. I wanted to show people that you don’t have to work hard to manage your money. If you do it right you can even retire early. What’s so hard about writing those annual Roth IRA checks? It took me all of a few minutes. Setting up the 401k was even faster than that.

Nearly ten years of blogging later, I’ve come to realize that there is a finite number of items that fit this criteria. Nowadays I assume most readers have this basic information and are looking to dig deeper. Today, I’ve got something new that should change how people manage their money.

Before I get to that though, let me talk about one of the biggest problems of managing money the “Lazy” way. It’s the old checking account/saving account conundrum. I need to write checks (even if they are automatic bill pay) via my bank account. The money in that account earns no interest. Alternatively, I can earn interest in my savings account, but I can’t easily pay people from it.

Thus, I’m left doing a money shuffle. The idea is to keep as much money in the savings as possible to maximize interest, while keeping just enough money in the checking so that I don’t bounce any checks.

Today, I learned that I don’t have to do the money dance. I found out that Radius Bank’s Hybrid Account acts as both a savings and checking account. It’s one banking account to rule them all.

Here’s how it works… You can use Radius Bank’s Hybrid Account just like any checking account. You can pay people from it just as you’d expect. The big difference is that account balances over $2500 earn an interest rate that is extremely competitive with the top high-interest savings accounts. How competitive? Radius Bank’s current 1% interest rate is actually better than Capitial One 360, Ally Bank, Everbank, and Bank of Internet.

So you get the best of both worlds… convenience of writing checks with an impressive interest rate.

If you are looking for gotchas, you are a smart consumer. I wish you luck, because I couldn’t find any. There are no monthly fees or minimum balance (other than the initial $10 to open to open the account). In addition, ATM fees are rebated back to your account. (That is one of my favorite features of any bank.) And of course you get typical FDIC insurance.

I think this is a game changer. Once people get a taste of this, why would anyone go back? Who wants to shift money in separate savings and checking accounts?

What do you think? Would you going to sign up for the Radius Bank’s Hybrid Account? Let me know in the comments below.

Goodbye Bank of America, Hello USAA

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If the title wasn’t exactly clear, I’m changing my banks. This post is actually quite a bit overdue. I had been gradually doing it for a couple of years now. I would have written about it earlier, but I didn’t realize it until recently. That’s how gradual the change has been.

It’s not that Bank of America has done anything in particular to lose me as a customer. I know many were upset by their announcement to charging fees on debit card purchases (though Bank of America changed its mind on the fees). I wouldn’t have been affected by it since I rarely use my card as a debit card. It comes down to the fact that USAA is a better fit for me and my family.

What sets USAA Apart

The first thing that comes to mind is customer service. I know everyone has their favorite companies when it comes to customer service, but in almost every case it seems anecdotal. I could show you ten bloggers and each of them would have a favorite web hosting service – and a lot what they’d talk about would be the customer service. With USAA, it close to unanimous that their customer service is the best. What I like the most is that when I call I get the person’s direct extension in case I need to call back or follow up.

The other thing that sets USAA apart is that they actually give you money back at the end of the year if they have any left over. I know that sounds odd. I don’t have the full explanation unless it is this Wikipedia entry, but my wife has multiple times gotten a check back at the end of the year. (Since she is the sponsor of the account, more on this later, I don’t have the full details of what they sent for the both of us. When it’s money in my favor, I tend not to ask too many questions.)

It’s taken me a little while to embrace USAA. When I first looked into it, I was curious about the brokerage accounts. I compared them to Zecco who had been offering free trades at the time. I didn’t see their rates as being competitive. However, Zecco has since started to charge for most (if not all) trades now. The gap has closed to where the customer service and the ability to have my savings, checking, insurance, brokerage, and IRAs in one place far outweighs a couple of dollars a year I pay in putting my Roth IRA money to work in an ETF.

Recently, I was able to consolidate the 401ks from three old jobs into one Rollover IRA. I can’t tell you how much simpler it is to be able to log into one web site and see it all.

Why I may keep Bank of America

While USAA is great for any number of reasons, I still see a need for my Bank of America account. It’s not that I have any allegiance to Bank of America, but that I feel the need to have a bank in the real world – one with branches and people who I can talk to face-to-face. There are a couple times where this has come handy – usually when I need to have a certified check of some sort.

In some ways my banking has become a little microcosm of my business. It is 90% done through the Internet, but 10% done in the real world. I don’t see that changing any time soon. USAA gives me a bank that has the online tools that match my business.

So Bank of America, this isn’t really good bye like I said in the title. We can still be friends. I am just looking for more out of my banking relationship.

(Though it might seem that USAA sponsored this post. They have not. I just really like them and I think you will too. That is if you meet the eligibility requirements which typically require some military connection.)