A few days ago I posted about my banking situation on Facebook–it’s a tad complex. and sounds almost elitist. In reality if I had enough money not to worry about fees, loans, credit cards, and having to run my own businesses to make ends meet I could stick with one bank. Here I’ll detail the nitty-gritty painful world of my financial endeavors. I’m largely not going to name names but with a quick Google it’s easy to figure out or via an e-mail I’m happy to divulge.
I have a long history of picking and choosing banks which make the most sense for my needs. At age 12 I switched banks outraged that my bank would let me deposit money but not withdraw without my mother’s permission. I found one which would and gave me a debit card to boot. I’ve been a credit card holder (co-signed until 18) since age 13 which helps with my credit.
I have a credit union which has great rates on loans an impeccable service. When my Master’s funding briefly fell through, and I wasn’t sure if I would make rent that month, I was able to secure a loan within 5 hours of making the decision with a personal phone call.
ING direct is an online only bank and I would have them as my only bank if they offered all the services I needed. They have no fees and don’t have you try to do silly things like having you fax documents or visit branches (hard when you live abroad). Their checking account comes with 1000 dollars in free overdraft-meaning it’s easier to manage and even less likely you’ll ever run across a fee.
All purpose bank
I have an all-purpose bank which serves as a go-between between the other accounts. ING direct requires having a physical account link to and my credit unions transfer guidelines are a bit of a pain.
Finally I have a credit card with the only American bank that has no international transaction fee. International transaction fees are typically 3% this really adds up when you do a lot of traveling especially when you live abroad. On one trip five years ago I paid over $500 in fees although I paid my bill in full every month. After that I learned my lesson. As a bonus the credit card offers rewards. I have redeemed a few free flights as in the US it is my practice to put everything on my credit card paying the bill in full at the end of the month.
At this point as I have a Swiss credit card I could conceivably get rid of my US card. However I keep it around as it has a very high limit just in case I need a huge chunk of emergency cash.
I’m not trying to avoid taxes I simply live and work in Switzerland. Since I get paid in Swiss francs it makes more sense to have Swiss accounts as well. Even though as you can clearly see I already have enough banking accounts-the international transfer fees would add up fast if I tried to avoid opening more.
All purpose bank
My Swiss bank has no ATM fees and rewards including discounts at the movie theater. As a bonus they are internationally known.
Most Swiss residents purchase a discount card for the public transportation. This card can optionally have a credit card integrated. Since I needed a Swiss credit card anyway it made sense to do this rather than carry yet another card. Unfortunately this meant dealing with yet another bank if only to pay the bill. Then it turned out I needed a savings account with the bank as well-this currently sits empty.
I earn a modest income from a few iPhone applications under two brand names with two different partners. To manage this I have two corporations.
The Delaware corporation I incorporated as an SCorp with the standard YCombinator procedure. There are sample forms online and while more expensive than the New Mexico Corporation its structure is more straightforward and suitable to further investment.
ING direct has business accounts with what seem to be as amenable conditions as their personal accounts. The catch being that for each of them you need an account to link to at another bank with physical branches. The price to pay for friendly business banking seems to be to double the amount of business accounts that I need. In any case it’s worth it and I intend to open two business accounts with ING direct soon.
All purpose bank
I need two business accounts with a bank with physical branches to link to my ING direct account. Unfortunately this didn’t make sense to use the same bank as a my all purpose personal US bank account, or any other bank I already have dealings with, due to lack of business services which can be easily operated remotely.
9 bank accounts, 2 credit cards, and 2 corporations, with dealings with a total of 8 banks, 2 registered agents, and 4 official addresses. Phew.