I've had a free checking account with WAMU (now Chase) since 2004. And while I've never used it as my primary checking account, I did maintain a decent balance while running several transactions through it each month. Frankly, it was just nice to have around when I needed it, and I probably would've never thought about closing my account had it not been for a letter I received from Chase a few weeks ago.
Apparently Chase, as we've seen with many other large banks like Wells Fargo and Bank of America, is ditching the old WAMU slogan - "Home of Free Checking" - and adding a $10 monthly fee to my account effective February 1st. The nerve! This is just absolute craziness to me. I've never paid a monthly fee for a checking account in my entire life. It just goes against the very core of my being.
But alas, it's no secret what's going on here, and I can't blame Chase. I'm sure I was an unprofitable customer in the first place.
Free checking accounts seem to always be the first thing on banks' chopping blocks as they frantically search for ways to make up for lost revenues due to new financial regulations. It's the same old cycle that we just went through with credit cards after the Credit CARD Act of 2009 was passed. Tougher regulations on cards cut directly into issuers profits, so major banks and credit card companies promptly began cutting credit limits and increasing APRs in response.
The result? We have some better consumer protections in place now, but many individuals with poor credit ended up in even worse financial shape while credit cards became more expensive for those that pay their bills on time and maintain good FICO scores. Personally, I know several of my credit cards have either increased or introduced new annual fees for 2011 while cutting back on rewards programs. Now, I won't have a free checking account at Chase anymore either, but theoretically some customer that used to overdraft his checking account and get slapped with a fat penalty every few months is paying less in fees. The money has to come from somewhere, right?
Well, it'll have to come from someone else in my case. There's no way I'm paying $10 a month for a checking account. Would you?
