Some thoughts on personal banking and Simple.
It’s been a matter of fact in my personal world of finances that switching banks has never been easy. I’ve switched financial advisors, rolled over 401k balances, opened and closed online stock trading accounts, all with apparent impunity compared to switching my bank account. The current U.S. banking system works against the consumer not for them. By that I really mean the large institutions that nickel and dime us for our every need it seems. Those bank’s actions add a Byzantine layer to an activity that is already fraught with anxiety – balancing one’s cheque book.
Of course online banking makes things easier in terms of accessing and viewing a bank account in almost-real-time these days, yet I always found something to gripe about. One puzzle for me when I was with US Bank was the limit on the number of counter visits I could make if I wanted to retain a free checking account. Who on earth counts the number of times they enter a bank? I’m not sure if that Sisyphean task is still required of US Bank customers as I left them for ING Direct a few years ago.
A quick aside – when I first moved to live in the USA back in 1988, I opened an account with Bank of America. As I went through the paperwork I asked the teller how I might access my account online. She looked at me as if I was speaking Latvian or some other exotic language. You see, I’d been accessing my UK account with Bank of Scotland by using a telephone modem coupler attached to a Sinclair ZX Spectrum home computer, that in turn was attached to my television. I couldn’t understand that such an advanced country as the USA was unable to offer that.
I received my Bank Simple, or Simple, invite about two months ago and I’m in the middle of transitioning my banking from ING Direct. I see on the Simple Facebook page that people are still waiting impatiently for their invite, and amongst them are people leaving comments like “can’t wait to leave my bank” or similar sentiments. I was once one of those people and I thought I’d write up my experience of switching to Simple.
I’ll begin with a question to myself – what do I require from a bank? The answer may seem obvious but there isn’t a one-bank-fits-all scenario. Here’s my banking history and requirements: I’d been with US Bank from 1999 (when I arrived in Portland) to about 2009 when I switched to ING Direct. The first hurdle with an online-only bank was cheque depositing. With ING it was by mail, a rather slow way. Now it has mobile phone depositing. I also required foreign interbank money transfers which ING couldn’t and can’t do. As a work around I opened an Umpqua Bank free-checking account for depositing cheques and for accepting interbank transfers from abroad. Once the Umpqua account was opened, only then did I close my US Bank account. I still have the Umpqua Bank account but perhaps not for much longer as you’ll see later in this post. So from a bank I require ability to deposit cheques, to transfer money from abroad, and of course, access to free ATM’s. Between ING and Umpqua I can do those things.
Back to Simple. My first insight: Upon receipt of your Simple invite you won’t be jettisoning your current bank right away. It’s not that, er, simple and to explain why I will list below some issues that transpired for me. I will preface this by saying that the Simple customer service folks are incredible, so there’s that.
My Simple experience:
Paying bills. I was used to the Bill Pay Centre on the ING site so it took some head scratching to find my way around the Simple bill pay option. At first it wasn’t intuitive although now I find it ok. I say ok because it still has some issues, one being when you cancel a scheduled payment you cancel all future payments too. Also, when I categorize a payment, say a credit card, I notice that the category doesn’t “stick” on the next automated payment. I am still adding categories manually after the payment has been made.
Funding my account. After setting up a series of future bill payments I obviously needed to fund my account and quickly. There are instructions on how to do this with some of the bigger banks, including ING, but not Umpqua Bank. I tried setting up a transfer from ING but it didn’t work out. I then transfered a lump sum from ING to Umpqua and sent money from my Umpqua account for deposit to Simple. It disappeared, not actually but figuratively. It just never showed up as a deposit in my Simple account. It turned out that if you have been with Simple for less than 30 days any cheques deposited are held for roughly 9 days – I feel that this should have been made much clearer. That was a problem as my money was in limbo and bills had to be paid. I canceled the Umpqua cheque (Simple refunded the $30 fee) then canceled the upcoming bill payments. I then set up a person-to-person account in ING with myself as the recipient at Simple. That worked. Soon afterwards I linked the ING account directly to Simple so transfers should be straightforward from now on.
When to send a payment. With ING I had become used to any payments being sent electronically so I could assure myself that any time-sensitive payments, like that credit card bill, would arrive in good time. The Simple bill payment system offers a withdrawal date when a cheque will be sent and then a window of time when it might arrive. That window is ominously long making it hard to determine when the payment may arrive. A customer service person gave me a list of the payees (that I’d set up in bill pay) that would receive my payments electronically. That helped but for safety I ensured that I had a lot of extra money in my account for sending large payments, such as my mortgage, well ahead of the payment receipt date. I’m still waiting for the results of my actions to come in which I’ll determine from future bill statements showing when the payment arrived.
Foreign transfers. It is possible to make a foreign bank transfer to Simple. I tried setting up a transaction using the SWIFT interbank system. It didn’t work out and none of the customer service reps could explain how to set it up. I was told to send money to see if it works – the problem with that is that I would incur charges on both ends just to “test” it out, so I’m in limbo on this one at the moment.
Categories. This is a useful tool especially if, like me, you itemize your taxes. What I’ve found, even though on the Simple blog someone wrote otherwise, when I set up automatic bill payments the category doesn’t “follow” the transaction. I’m still entering this info manually. I’m told it’s a bug.
Safe-to-Spend. This will be a great help when it works. By “when it works” I mean that as Simple processes the data I am inputting it will actually be accurate. Here’s the thing currently: I have set up all of my bill payments to occur automatically. This means that they all show up in the ‘Transactions’ area of my account. The issue is that Simple doesn’t take into account that the direct deposit of my salary takes place on the 15th and the last day of each month. By not taking that info into account my Safe-to-Spend amount is wrong.
Location. There’s an option to map transactions you make. This is sometimes inaccurate. For example I saw a charge for a few dollars that was listed as the Bridgeport Brewpub in the Pearl. I’ve been known to enjoy a beer now and then but I’d actually purchased a cup of coffee about three blocks away at the Daily Cafe.
No joint accounts or savings accounts. Bummer.
Small beef. The iPhone app works really well but in the Safari app on my iPad the top nav bar is slightly hidden by the transactions area.
Let me just be clear. Throughout all of these teething troubles the Simple customer service team has been extremely impressive in its timeliness and quality of responses. The foreign transaction issue is still outstanding but I’m unsure if the ball’s in my court or theirs right now.
Another thing. I’m definitely sticking with Simple as I know that the service and my banking experience will only get even better over time. With their phased roll out approach using the invite system, the company is operating in a ‘test and analyze’ mode. My actions and the feedback I send them through support, as well as the actions and feedback of everyone else using the system, will lead to improvements culled from actual user data. With this approach it’s almost impossible for the Simple experience to not get better.
And today they introduced mobile cheque depositing which means I might be able to close one of my other bank accounts. And did I mention the thousands of no-fee ATM’s in their network?