by Jamie Chris Moore
Only a few years ago, getting your finances
together was like starting a scavenger hunt. Searching banks for rates on
savings accounts and loans, going to brokerage firms for stocks and bonds,
and finding insurance companies for term and whole life policies was
burdensome.
Now, banks brokerages, and insurers are competing to become one stop centers for all your financial needs. As the Federal Trade Commission continues to loosen restrictions, many people are enjoying the convenience of consolidating debt, investing, and preparing for the unexpected in one place - particularly at their local banks.
While you may still look at banks as a place for checking, savings, and loans, many of the larger institutions like Chase Manhattan, First Union, and Nationsbank are becoming popular for their mutual funds and life insurance.
Deregulation has had a profound effect on the industry, giving rise to new products and services. It has also stimulated competition, which has added value and cut cost to consumers. Asset Management Accounts, for example, invest money that could be in a savings account to get higher rates, but add the features of a checking account such as check-writing and ATM transactions. These types of accounts usually have annual fees, but there are other ways consumers can bank and invest at low cost.
Simone Henry, for example, a Morgan State Information Systems major is having $25 a month automatically drawn out of her checking account at First Union Bank and invested into a mutual fund of First Union Brokerage. This service was setup at no charge.
One of the most common cross-sector activities being done at banks is lowering monthly bill payments with an equity loan, and putting the extra cash created into a tax deferred retirement account or life insurance policy. While many people find it difficult to put anything away for a rainy day, this is a good example of how your local bank representative may be able to not only consolidate your debt, but draw on services traditionally outside of banking to help you prepare for the financial future.
No matter what your situation, however, take the time to sit down with your banker and give him or her a chance to learn about you and your goals. While you may have meant well starting a savings account for that newborn niece or nephew, if your banker knows the money is designated for college expenses, you may be better off in a tax deferred educational IRA. The key to financial success is finding out what is available and listening to what an expert has to offer. Today's banker is also today's broker, insurance agent, and lifelong financial advisor.
Jamie Chris Moore '98, is a Financial Specialist with First Union in Baltimore. He specializes in loans, investments, and other financial services for personal and business clients. He can be reached at
410-244-3576 or e-mail at jamie.moore@firstunion.com