The Trouble with Bank Accounts and Debt

Opening up a bank account can lead to debt?  What?  How can this possibly be?  You are paying what you want into that account, right?  What the heck am I missing here?  Believe or not, it’s true!  Bank accounts can lead to debt, and depending upon your makeup as a person, it could be massive debt!  Let’s flesh this out…..

So you want to open up a bank account, you know, someplace to put your hard-earned money.  Maybe get a little interest, but in today’s economy with interest rates paying close to zero percent, that is a big longshot.  Okay, at least having an account will keep my money in a safe place, right?  Maybe, but the reality is that when a person opens up a bank account, they are soon going to be marketed to death with all sorts of offers.  Do you remember when I said “depending upon your makeup as a person”?  Why?  Because if you are demonstrating to the bank that you have a regular source of income, such as a paycheck, and are depositing that income on a fairly regular basis, you are a nice juicy target for a bank credit card.  And that is trouble with a capital T!

Just because they market a credit card to me, why is that trouble you may ask?  Here is where the word “makeup” or personality or responsibility comes in.  For a lot of people, credit cards are nothing but trouble.  That is a fact.  Just check out the statistics of how many people are in trouble with credit card debt and the facts speak for themselves.  Why is it that almost a quarter of the ads on radio and TV are for debt settlement companies?  The only thing worse than the credit card companies themselves are the debt settlement companies, but that’s another story.  So here is where the danger starts, you like to spend,and now you have a credit card from your bank,all because you opened up an account.  Strike 1.

Strike 2: You are finding it is getting tough to pay all your bills on your salary, but for some reason even though you knew you only have a few hundred in your bank account, you purchased two hundred and twenty dollars worth of goods.  And your debit card which you got at your bank allowed the purchase to go through somehow.  Great!  I’ll just replace the money as soon as possible.  But you get home and something else comes up and you forget for one reason or another.  Don’t worry, the bank didn’t forget, because the next time you look at your account balance, you are socked with an overdrawn fee that would choke a horse…..

Strike 3: Now you are beginning to slip financially because you are spending more than you are taking in.  Your car went on the blink and you had to spend close to a thousand dollars for repairs.  Charge it up, because that was you only option as you didn’t have the money to pay cash.  Now you are getting hit with interest fees from the credit card company which are ludicrous to say the least!  You are beginning to regret the day that you opened up a bank account, because it all seemed so nice and easy…..

The scenario above is just a sample of one way people get in over their heads, and there are millions of other examples.  Do you still want to open up a bank account?  Go ahead, but be very, very careful……