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Many often wonder that when they see a CD rate that seems too high compared to industry standards, they just assume it’s a scam or too good to be true.  While sometimes this can be the truth, it necessarily isn’t always true.  When it comes to higher CD rates, there are a few things you should look out for before you submit your application.

Check the terms and conditions

Every legit bank online or in person will have a set of terms and conditions when it comes down to the CD you want to apply for.  If the rate sounds too good to be true, there are a few things you’re going to have to note.

Does the bank require that you do something each month?

In order to make money on your CD, the bank may require that you sign up for direct deposit or a debit card and make at least x amount of purchases each month to keep that rate in tack.  If you don’t keep these minimum requirements, they will drop you down to the default rate.  Keep in mind that the banks rarely give you a warning; instead they just drop you without further notice, so it’s important that you remember to make those minimum requirements each month.

How do I know it’s legit?

In order to make sure it’s legit, make sure you check for the FDIC insurance logo and also check the FDIC’s main website at fdic.gov.  If the bank is listed, the bank is legit.  If it isn’t, I would highly suggest you stay way or invest at your own risk.  If the bank isn’t FDIC insured and the bank goes under, you’re out of luck!  If the bank is insured, go back to step one and see what the requirements are.

Sometimes the banks will offer a nice promotional rate with no strings attached just to draw in new customers or receive a hefty set of money for other ventures.  Even though it sounds too good to be true, it isn’t!  The next time you see an unbelievable rate, jump on it, it may be the last time you see it!

Whether you’re looking to open up a new CD or a savings account with a bank, the bank has to make their money somehow and it usually comes from those pesky fees that are located in the fine print of your application.  To make it easier for you and me, I’m going to break down the top three fees that people generally overlook.

The overdraft fee

Ah yes, the overdraft fee.  This is the fee that all the banks love because this is where they can get a lot of money from you.  An overdraft fee is generally when you over spend on your checking account.  Let’s say you have $100 in your checking account.  You go out and blow $110 of it thinking that the other $100 check cleared making it a total of $200.  Well, if that check hasn’t cleared, your balance will be -$10.  On top of the -$10, the bank is going to charge you anywhere from $20 for the overdraft fee.

Lesson:  Always make sure you have money in your checking account.  Keep track of your spending!  The best place to do this generally is online.

Paper fees

The less work the bank has the do, the happier they are.  With the internet and the computer age, no one should be getting paper statements anymore.  Did you know that some banks actually charge you if you still want a paper bill?  Make sure your bank isn’t charging you for this service.  This will generally range anywhere from $5 and on.

Lesson:  Make sure you receive you statements electronically via e-mail or your bank account.

The last minute bill pay

Did you forget that you had to pay a bill and it was due tomorrow?  Don’t worry; the bank will be happy to send it tomorrow for an extra $15 or so.  Check and see what the bank charges if you need to get your money somewhere overnight.  You may find that sometimes it’s cheaper to send it yourself rather than the bank.

Lesson:  Don’t wait till the last minute to pay your bills.

If you’re anything like me when you opened up your first brokerage account, you were probably confused on what was out there that would make the most for your money when it came to investing.  Learn about investing was one thing but the next question was, ‘Where do I do the investing?”.  There are a ton of places online and in house that can help you invest but the first things you’re going to have to ask yourself are a few questions.  The reason I’m writing this today is to help you better understand how brokerage firms work and how you can get the most for your investing portfolio.

What are the costs?

The first thing you’re going to want to do are look at the costs of your firm.  How much are they going to charge you for trading, etc.  Since all the prices are going to vary, make sure you look at the firm’s price list.  The best thing to do is to simply print out or save the price list from each firm and compare.  If you only intend on using the firm for stocks, then compare the stock prices.  You’ll find that some places are cheaper in some areas.

The selection of stocks, mutual funds, etc.

Some firms only allow you to trade in certain markets.  If you’re going to be a heavy investor, make sure you find out how many mutual funds they offer and what markets you can trade on.  Services such as E*Trade allow to trade on more than six global markets.  If you’re going to be an aggressive day trader in the future, this will be very important to you.

The customer service

Just like a store you shop in, you don’t want to deal with a place that doesn’t care about their customers.  The best way to see if the firm you’re looking at has great customer service is by checking the reviews online or asking around to friends and family.  You’ll usually get a great idea of how good the customer service is just by reading reviews online.  Another great way to find out also is by calling the number on their website.  This alone will sometimes give you a great idea on how good the company will treat you.

These are the top three things that you should be aware of when you’re looking for your first brokerage firm.  Remember, a brokerage firm is just like a bank.  If you’re unhappy with the service, you can simply run away to another one.  Make sure that you do your research and know what you’re doing with investing before you open an account.  The more knowledge you have, the better off you’ll be.

When it comes to banking online, some people tend to wonder if a bank is legit or not. Sometimes we notice that some rates are too good to be true, making us believe that the bank might just take our money and run. Before you bank with anyone online, it’s important that you follow a few steps to make sure a bank is legit before you proceed and open up an account.

Check for the FDIC insurance logo

The first thing you’ll want to do before you even start your research is to look for the FDIC insurance logo. The logo looks something like the logo here –

Now remember a bank can just throw up a logo even if they aren’t legit. It’s not to hard to copy an image and throw it on a website. The best thing to do after you spot this logo is to head over to the FDIC’s bank find section of their website and search for the bank. If nothing pops up, you may be looking at a scam. If the bank does pop up, this means that it is FDIC insured and your money will be safe.

Another thing you need to look out for when you do your bank find is to make sure that bank is operating under a different name. Some banks may open up a different name for their online bank. Make sure that you know this information before doing your search. If it becomes confusing, simply call the bank itself and ask for the FDIC certificate number.

Once you find out if the bank is insured, there are a few other things you’re going to want to spot before filling out the information.

Spot the SSL on the browser. Whether you’re surfing with Internet Explorer or Firefox, etc, make sure that the application and the bank website itself is in SSL mode. This is a mode that protects yourself from hackers when you send sensitive information from your computer to the bank’s servers. The best way to find out is to look for the lock either on the address bar or on the lower toolbar.

Make sure the bank has a phone number. Sometimes people overlook this one. When you’re banking with an online bank, make sure the bank itself has a phone number so that if anything goes wrong, you can simply call them up instead of waiting for an e-mail response.

These are the most important parts when it comes to working online banks. As long as you make sure that the bank is insured and you have a proper way of contacting, being safe with your money shouldn’t be an issue anymore. It also never hurts either to look for reviews on the banks as well.

If you’re one of the lucky Americans that are getting back a tax stimulus check this summer, you’ll be quite pleased that some stores are giving you back a bonus if you cash your check at their store.  I did a little research and found a few stores that are offering the bonuses.

Kroger Supermarket – Offering 10% bonus

Kroger is offering a 10% bonus if you cash your stimulus check at their customer service desk.  There will be a limit up to $1,200.  This would mean that if you received a $300 check, Kroger would give you back $330 in Kroger gift cards.  This wouldn’t be a bad deal because we all need groceries!

Sears and K-mart – Offering 10% bonus

Sears and K-mart are also offering the same exact deal that Kroger is doing.  Simply cash your check at the cash register and you’ll receive a 10% bonus in the form of a gift card.  Act fast because the deal ends on July 19, 2008.

Tip:  If you’re not a big fan of gift cards, I would try and get the gift cards and turn around and sell them on Ebay.  If you do a search for “Kroger gift card” right now, you’ll see that some people are throwing up $330 gift cards and they are easily going for $320+.  It’s a great idea if you want even more cash!