CSB OVERDRAFT PROTECTION

SO, WHAT ELSE IS NEW?

Perhaps you have noticed that many financial institutions seem to be scrambling to adjust their overdrawn account fees lately.  Overdrawn accounts have been a sensitive subject for banks and their customers for many years. 

For our checking account depositors who will apply and qualify for a credit line loan account, Chelsea State Bank features an automated overdraft protection line of credit tied to your checking account that will advance funds in $100 increments, should your checking account fall below a zero balance.  If you don’t ever use the line, the cost is nothing.  When an advance is made, the cost is a nickel per $100 per day until repaid (18.0% APR).  A nickel could save you $30 the first time you’re overdrawn.  It’s like insurance you don’t have to pay for, UNLESS you are in an accident!

Sound good?  CSB has been providing this service since 1993!  16 years ahead of all of those financial institutions that are now scrambling to adjust.  Why take the risk?  If you are one of the hundreds of satisfied CSB checking account owners already enjoying this service, thank you for the opportunity for us to serve you.  If you’re not, where have you been?  Call us today and let us help you bank with confidence.  475-1355

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PERSONAL FINANCIAL PLAN

Many people launch their personal financial ships for the first time without a clue as to what can sink the boat.  Just as you would likely benefit from some boating safety information before you sail off on your initial voyage, a personal financial plan will likely be helpful before you set out in the sea of life.   Understanding the relationship between income and expense is the key to maintaining a comfortable balance. 

Let’s start with income.  While it’s important to make sure your tax liabilities are reasonable, many people make the mistake of “over-withholding” on taxes taken out of their paychecks so they can “get a big refund from the government” in the spring.  To participate in this activity denies you use of some of your own money all year.  Keep withholding amounts adequate to cover the taxes that will be due, but no more than that.

Once you have determined the correct withholdings, the amount left for you is your “net pay”.  Convert your net pay to a monthly figure by calculating the number of pays you get per year, times the net amount, divided by 12.  The primary rule here is to NEVER allow your fixed monthly payments to exceed ½ of your monthly net income.

What is considered a fixed monthly payment?  Rent or mortgage payment, car loan or lease payment, personal loan payment, credit card carrying a balance payment, and any other LOAN payment.  In this method, food, utilities, insurance, and all other expenses are to be budgeted from the other half of your net income.

Example:  Suzy earns $800 per pay (every 2 weeks) after taxes.  26 x 800 = 20,800 annually divided by 12 = 1,733.33 monthly.

According to our plan, Suzy needs to limit her fixed monthly obligations to $866.66.  She and her roommate share an apartment and each pay half of the $600 monthly rent.  Since her share is $300, that leaves 566.66 to cover her other fixed monthly payments which include her car at $200 and a student loan of $75.  Her credit card seldom carries a balance that she can’t payoff each month, a good sign that she hasn’t abused use of her credit card.  Her total fixed monthly payments are $575.00.  (300 rent + 200 car + 75 student loan)

Her monthly budget for the rest of her expenses is:

Savings          $100.00
Insurance           56.00
Food                 400.00
Entertainment  100.00
Gas                     50.00
Phone                 50.00
Electric                50.00
Clothing              50.00
                       $856.00

To help her account for her finances, Suzy has her paycheck directly deposited to her bank on payday.  She immediately transfers half of the check (plus $50) to her combined savings account.  She only moves enough money back into her checking account from savings when one of her fixed monthly payments is coming due prior to the next payday.  Because Suzy has kept her finances in line, she has managed to save over $2,000 in the last year. (Top)

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Complete Payment System 

Are you getting the maximum benefit from your bank relationship?  The following tips can help you get the highest quality personal banking experience anywhere!  As your portal to the payment system, CSB can provide you with the financial tools you need to succeed.

Your lead checking account is the proper transaction vehicle for all of your incoming and outgoing payments.  Because savings accounts are limited by *regulation as to the number of pre-authorized transfers made, they better serve as a reservoir for immediately available funds you are able to keep, at least for a while. 

Linking the appropriate savings account(s) to your lead checking account allows YOU to maintain the balances in all of your accounts relative to your specific income and payment needs.  We recommend that you maintain a balance in your lead checking account that will adequately fund outgoing payments for the ensuing week.  The amount of the difference can then be transferred to or from the savings account (reservoir) until the next week through csbonline.com or CSB telephone access.

By maintaining the correct balances weekly, *regulations that limit remote savings transfers or pre-authorized transfers to no more than 6 per month will always be satisfied.  Weekly account maintenance also allows you to keep much better track of your account activity.  It shouldn’t be surprising that balancing your account weekly is MUCH easier than when waiting a full month. 

Once you have become accustomed to weekly account maintenance and transaction review, you will likely see that pre-authorized bill payments originated by your creditor(s) or online bill payment by you using CSB online bill pay, are convenient tools at your command.  Many of our banking clients have decreased paper check writing to practically none. 

Your ATM/debit card is the next tool you need to have in your financial tool kit.  It’s a reusable plastic check accepted anywhere Master Card is honored.  

Finally, our overdraft protection credit line can save you if you miscalculate the days or accidentally drop an item from your check register.  Once your application has been approved and the stand-by line of credit agreement has been signed, transfers in even $100 increments will automatically guard your lead account from costly and embarrassing overdrafts.

So choose your day of the week and start getting the most from CSB.  Here are the necessary tools you should have to maximize your personal banking relationship:

             Lead Checking account

            Combined Savings account

            www.csbonline.com internet banking

            CSB Telephone Access

            CSB online bill pay

            CSB ATM/debit card

            CSB overdraft protection

 *Regulation D of the Federal Banking Regulations

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ATM's

Explained

After the cardholder’s bank receives the repayment request, it must charge the  cardholder’s account and forward the repayment back to the ATM owner bank so that bank can get the money back it gave to you.  That is the back end fee you are charged by your own bank.

“Can I get cash from an ATM anywhere in the U.S. and have the ATM owner bank and my bank settle my transaction for those two fees?

As long as the ATM is a member of the network sponsoring your card, yes.

“How many ATMs are there?” Millions at best estimates.

“Is there a way to do the transaction without a fee?”

Yes.  Use the card in the store where you are making the purchase as a point of sale payment instead of going to an ATM machine to get cash.  Most retailers allow a reasonable amount of cash back to the customer at no extra fee.  Use that feature to re-supply your pocket cash.  Of course you can plan ahead and be sure to stop by an ATM owned by your own bank where the fee is waived.

“So if I use my ATM/Debit card to make purchases at the store instead of getting cash at a machine, there is no fee and I can pocket return cash up to the limits set by the store?

Yes, providing the total transaction doesn’t exceed your account available balance.

We can help!  Call us for more information at 734 475-1355.  Top

“How can they charge me a fee for my OWN money?”

Because it’s NOT your money.  The real truth is that the cash in the ATM machine belongs to the owner of the machine, not you.  In the early days of ATM cash service, a cardholder could ONLY get cash from an ATM owned by his/her own bank.  As time went on, the banks learned how to “exchange” transactions to broaden the availability of ATM cash services to cardholders using a network.  Since the bank that owns the ATM has the expense of the machine itself, the cash inside it, and maintaining the connections to the network, “guest” users of the ATM are receiving cash right now that the host bank (the true owner of the money) is dispensing to them.  The host bank must then contact the “guest” cardholder’s bank to line up the repayment of the cash dispensed.  That’s what your front end fee covers.

“So why do I have to pay my own bank a fee for the same thing?  That seems like a double charge."