You’ve probably heard about the new tax law by now, and depending on your political preference, you either love it or hate it. But regardless of which way you swing politically, it’s important to understand how the new tax plan — passed in December 2017 — impacts your finances.

In fact, the more you know, the easier it will be to maximize your tax refund. To help you get started, here are 6 things you should know about the new plan.

1. It won’t go into effect until the 2018 tax year

While 2017 tax returns are due in April, don’t go crazy trying to figure out how you’ll be affected by the new tax changes. You have plenty of time to get up to speed before the deadline to file taxes for 2018 — in April 2019.

Of course, the sooner you learn how the changes affect you, the sooner you can start planning to take advantage of any available tax breaks.

2. Tax rates are lower across the board

The new tax plan lowers individual income tax rates for almost everyone, which may provide tax refunds, depending on other factors in your tax return. For example, according to published information provided by the Tax Foundation, here’s how things are changing for married couples filing jointly:

Note, however, that these new tax cuts aren’t permanent. To comply with senate budget rules, they’re expected to expire after 2025. So, if your income stays the same, you may see higher taxes again in 2026.

3. You may not need to calculate your itemized deductions

One of the bigger changes congress made to the tax code was increasing the standard deduction. To clarify, every taxpayer is allowed to make certain deductions from their income before the IRS applies the relevant tax rate.

Everyone is eligible for the standard deduction, which is currently $6,350 if you’re single or $12,700 if you’re married and filing your taxes jointly. With the new tax plan, however, that standard deduction goes up to $12,000 for single taxpayers and $24,000 for married taxpayers filing jointly.

This means that you may opt to forego itemizing your deductions as it may not be necessary. For example, in 2017 if you had certain eligible expenses that exceeded your standard deduction amount, you could itemize them — resulting in a bigger deduction and lower taxable income. Going forward, however, you may not need to calculate your deductions for expenses — like charitable donations and mortgage interest — because the new standard deduction may be higher than your combined expenses. For many people, a higher standard deduction may automatically result in a lower taxable income.

4. Bigger families could lose the benefit of a higher deduction

While congress almost doubled the standard deduction, this increase has been offset by the loss of personal exemptions.

For instance, you can typically take a personal exemption for you, your spouse (if you’re married) and each of your dependents. For the 2017 tax year, the personal exemption is $4,050 per person. So, if you’re married with a family of five, that’s a $20,250 reduction of your taxable income — in addition to the standard deduction of $12,700.

Yet, with the loss of personal exemptions in 2018, a family of five may actually end up with a higher taxable income than before the bill was passed.

5. The new-and-improved child tax credit could help soften the blow

If you have one or more qualifying children — learn more about who qualifies here — you may be able to claim a $1,000 credit for each child in 2017, which directly decreases how much you owe in taxes. This is in contrast to a tax deduction, which decreases your taxable income.

With the new tax law, that credit gets doubled to $2,000. What’s more, up to $1,400 of the credit is refundable.

6. Business owners may get a huge tax break

If you own a business that has pass-through income, you’ll be able to deduct 20% of your business income when filing your taxes. Pass-through income means that income from the business passes through to the owners and is taxed on an individual level.

According to the Brookings Institution, 95% of U.S-based businesses are pass-through entities, so your business may already qualify for this deduction.

You’ll be eligible to maximize this deduction if your household income is less than $157,500 (or $315,000 if you’re married and filing jointly) and your business is one of the following entities:

• Sole proprietorship
• Partnership
• LLC
• S-corporation

Work with a tax professional to get up to speed

While these are some of the biggest changes in the new tax plan, they’re far from the only ones. To get up to speed on how these and other changes to the tax code will affect you, it’s a wise idea to work with a tax professional who understands the ins and outs of the tax code and can help you take advantage of the changes.

Although hiring an accountant or tax advisor may cost you, keep in mind that you can also earn it back — plus some — if you end up with a higher tax refund going forward. And while you’re at it, make sure you set up direct deposit to receive your tax refund. This way, you’ll get your refund within 21 days rather than eight weeks.

Originally published at www.chimebank.com on February 19, 2018.

We’ve all heard this saying before: Time is money. Plus, we’re all looking to save time and money, right?

Well, guess what? If you’re looking for an easy way to maximize your time and cash flow, you’re in luck. A Chime bank account can help you reach your money goals — and fast. What’s not to like about that?

To see how you can bank on more time and money, check out these 10 ways Chime can help you #BankFaster. Ready, set, save!

1. Save Money Automatically

Are you ready to start saving money without thinking about it? By signing up for Chime today and opening a Savings Account, you can enroll in Automatic Savings in one click. You’re now on your way to saving money every time you spend on your Chime Visa® Debit Card. That’s right, every time you pay a bill or make a purchase on your card, Chime rounds up the transaction amount to the nearest dollar and deposits that amount into your Chime Savings Account. Not only that but Chime helps you save money every time you get paid. How? Chime will automatically transfer 10% of your paycheck into your Savings Account.

2. Get Paid Early

Chime members can get paid up to two days early thanks to early direct deposit.* To take advantage of this Chime feature, all you have to do is set up direct deposit with your employer and, well, that’s it! Your paycheck will post to your Chime Spending Account up to two days earlier than traditional banks.

3. Pay Friends Instantly

At Chime, you can make instant peer-to-peer transfers through our Pay Friends feature. This lets you send money to other Chime members instantly, giving you an easy way to split bills like rent and restaurant tabs. You can say goodbye to divvying up checks and if you forget your cash or credit card, you can pay friends (or receive payment) right through your Chime app. And perhaps the best perk? You can send and receive funds in seconds, compared to Venmo transactions which can take up to three days.

4. Stay Informed with Daily Balance Notifications

Chime helps you start the day in the know with a simple balance notification to let you know where things stand with your bank account.

5. Get Transaction Alerts in Real Time

The Chime app also sends you real-time transaction alerts. This means you’re the first to know any time there’s a transaction on your account, and you’ll never need to wonder about when or if a deposit was posted to your account.

What are you waiting for? It’s time to bank the way you live. #BankFaster with Chime!

*Faster access to funds is based on comparison of traditional banking policies and deposit of paper checks from employers and government agencies versus deposits made electronically. Direct Deposit and earlier availability of funds is subject to payer’s support of the feature and timing of payer’s funding.

Banking Services provided by The Bancorp Bank, Member FDIC. The Chime Visa® Debit Card is issued by The Bancorp Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa debit cards are accepted.

Originally published at www.chimebank.com on October 10, 2017.

A few months ago, we talked about how much money you should have in your savings account. The answer: it depends!

While we did give you a handy-dandy formula to help you decide how much money you should keep in your savings account, the truth is, it’s up to you! Today we’ll tackle a similar question: how much money should you keep as a buffer in your checking account? Even though I’m a personal finance writer, even I am left wondering about the perfect amount to keep as a buffer in your checking account.

So, I decided I’d survey some personal finance experts, as well as a few real people, to find out how much of a checking account buffer they think is ideal.

What is a checking account buffer?

Before going any further, it’s important to first understand exactly what a checking account buffer is. Basically, a buffer is any extra money you have left in your checking account after you’ve paid your bills. Most people who have a checking account buffer keep this money in their account to use for emergencies or unexpected expenses that may pop-up from time to time.

We all know that life can throw us curveballs and a checking account buffer can be a good way to help off-set some of those costs. Vernon Hurd, the Executive Director at the Thomas County Economic Development Alliance in Colby, Kansas, agrees. “I keep $500. It’s enough that I can cover most unplanned expenses without the need to transfer money from savings.”

It’s important to note that a checking account buffer should be in addition to your regular emergency fund.

“It’s better to not reach into your emergency account unless it’s a true emergency,” says Ryan Inman, a fee-only financial planner for physicians.

How much buffer should you keep in your checking account?

Again, just like with the size of your savings account, it depends. And, to better understand what other people think about this, I sent out a survey by email, and posted it on social media. The responses I got were all across the board.

Some said as little as $100. Others said $250, $500, or $1,000. Still others based it off of income or expenses. But, 100% of respondents said yes, you should have a buffer in your checking account.

When it comes down to it, each person has a solid reason for the amount of money they opt to keep in their checking account buffer. For my respondents, their answers were based on how much they earn, how much they spend each month, and what type of lifestyle they lead. For example, someone with kids may choose to keep more of a checking account buffer than a single person.

“With variable expenses, two kids, and automatic deductions for bills, keeping a buffer helps me not have to worry about if I have enough money to purchase something at any given time,” says Kim Studdard, an online business manager from Kansas City, Missouri.

Likewise, if you’re self-employed with a variable payment schedule, or a homeowner, you may need to keep a larger checking account buffer to account for those lifestyle choices as well.

How to start building a checking account buffer

Unfortunately, not everyone can snap their fingers and build a checking account buffer overnight. If you’re currently living paycheck-to-paycheck, it may take time to build a healthy checking account buffer of any size.

Personally, when I started budgeting, I didn’t have a checking account buffer. I had to slowly ease myself into a healthy checking account surplus, $20 at a time.

Making sure you’re not losing your hard-earned money to expensive and unnecessary bank fees is also a good way to start building a checking account buffer. For starters, you may want to switch to a bank account with no fees, like Chime. Remember: it’s better to start small than not start at all.

Originally published at www.chimebank.com on September 29, 2017.

You may have heard that sticking to good financial rules of thumb can help you achieve financial security. But, you may also want to be aware of money myths that can have major negative implications.

To help you stay informed and make smart money moves, you may want to read up on these 5 money myths.

1. Checking your credit hurts your credit score

With credit reports, there are two types of inquiries: a hard inquiry and a soft inquiry. A hard inquiry happens when a lender checks your credit report — at your request — to make a lending decision. Hard inquiries can knock a few points off your credit score and stay on your credit report for two years.

A soft inquiry happens when a company or person checks your credit report to pre-qualify you for a loan or credit card, or perform a background check. It also happens when you check your credit score. Soft inquiries don’t affect your credit score in any way.

If you believe this myth and don’t check your credit score often, potential errors or fraud could go undetected long enough that it would be hard to clear up quickly. And, a ruined credit report can also make it hard to get approved for credit when you need it.

2. A home is a good investment

There’s no guarantee that your home will appreciate in value at a reasonable rate. We only need to look to the Great Recession to see how quickly home prices can plummet.

Even some homeowners who could afford their monthly payment were “underwater” as the value of their home descended below their loan balance.

There are also extra costs involved with owning a home that should be considered in calculating your return. For example, homeowners insurance, private mortgage insurance, and property taxes are all mainstays with many mortgages. Maintenance and unexpected repairs can also get pricey.

That’s not to say a home can’t be a good investment for someone who is willing to take on the risks. But, it’s important that you don’t make such a long-term financial commitment thinking you’ll automatically make money — especially if the housing market suffers another crash.

3. All debt is bad

Focusing all your efforts on paying off debt can leave you without adequate emergency fund and retirement savings. When creating a plan to tackle your debt, keep all of your financial goals in mind.

Mathematically, low-interest debt can be good if you’re using it as leverage to work toward your other goals. For example, say you have $10,000 left on your auto loan with a 2.49% interest rate. You can put an extra $200 a month toward the debt, or you can put that money into your retirement account, where you could realistically get a 5% to 7% return over the years.

4. Carrying a balance on your credit card boosts your credit score

If you’re paying off your credit card every month, that means there’s no balance to report to the credit bureaus, right? Not necessarily. Credit card companies typically report your card balance to the credit bureaus once a month, and the reporting date is rarely the same as the due date.

So, unless you don’t use your card at all, it’s likely that the company will always report a balance. What’s more, credit card companies don’t report whether or not you’ve paid in full, just whether you’ve paid on time.

As a result, carrying a balance doesn’t have any effect on your credit at all. Instead, it could lead you to paying interest unnecessarily for years — and that’s money that you could use for other things.

5. Buy high, sell low

It’s a common emotional response to buy into the stock market when things are going well and to sell as the market tanks. The problem with this is that you’re losing money by buying your stocks at a premium and selling them at a discount.

Instead, think of stocks as groceries. Focus on what can provide you the most value for your money and avoid overpriced items until they go on sale.

If you invest in mutual funds, use the dollar-cost averaging method, investing a fixed amount every month regardless of how the market is doing. This strategy can mitigate the risks that come with a volatile market.

Don’t believe everything you hear

Not every money tip you hear is in your best interest, no matter how good it sounds. If something sounds even a little off, spend time researching it to make sure it holds water. This is especially important when it comes to debt and investing, as these often involve a lot of money over time.

The more you know, the more control you’ll have over where your money goes. This, in turn, makes it easier to reach your financial goals.

Originally published at www.chimebank.com on September 25, 2017.

Debit vs. Credit: How They Compare

The best choice for you likely depends on what you want to use your card for. Take a look at our winners for the following benefits, fees and uses.

Fraud protection

Both debit and credit cards offer zero-liability protection on fraudulent purchases. But the process of getting your money back differs depending on the type of card you use. According to the Fair Credit Billing Act, the maximum amount you may lose on an unauthorized credit card charge is $50, and the investigation will likely be over by the time your statement balance is due. However, under the Electronic Funds Transfer Act, your potential loss on a debit card may be as much as $500 if you report the fraud more than two days after it took place. What’s more, the bank may not restore that cash to your account immediately. If you need that money now, you’ll be at the mercy of the bank. In both cases, you’re not responsible for any amount of the unauthorized transaction if you report the card missing before any fraudulent purchases take place. Winner: Credit cards

Spending control

The winner on this one is fairly obvious. Because debit cards are linked to a checking account instead of a line of credit, the only way to go into debt with this type of card is to overdraw your account. And you can avoid this by opting out of overdraft protection. It’s possible to use credit cards without going into debt, but folks who pay off their balances in full each month may be in the minority. According to a 2016 NerdWallet study, households with credit card debt owe $16,748 on average. All things considered, it’s easier to overspend with credit cards than with debit cards. Winner: Debit cards

Rewards

Rewards are a common feature for credit cards, but it can be difficult to find a debit card with a good rewards program. According to Elan Financial Services, just 17 out of the top 25 financial institutions offer a debit rewards program. Even then, credit cards offer big profits for banks, so they’re more competitive in offering rewards to entice people to use their cards more often. As such, you’ll likely find better rewards and big sign-up bonuses with credit cards. Winner: Credit cards

Fees

When applying for a credit card, it’s a smart idea to review the cards rates and fees as part of your application submission. When doing so, you’ll notice that most credit cards charge a slew of fees, depending on how you use the card. Late fees, cash advance fees, balance transfer fees and foreign transaction fees are all common among credit cards. Some even charge an annual fee. And that’s all on top of interest charges if you carry a balance. Debit cards, on the other hand, typically don’t come with a lot of fees. In fact, if your checking account charges a monthly fee, you may be able to get the fee waived by using your debit card regularly. Better yet, with the Chime Spending Account and Chime Visa Debit card, you won’t have any fees at all. That’s right — no monthly maintenance fee, no overdraft fee and no foreign transaction fee. You’ll also pay no ATM fees at over 24,000 MoneyPass ATMs. Winner: Debit cards

The Best Option May Depend on the Purchase

If you have a debit card and a credit card, you may benefit from using both. For example, when you rent a car, stay at a hotel or fuel up your car, it’s best to use a credit card. That’s because the merchant may place a funds hold on your card. Depending on the purchase, that could be hundreds of dollars. If you’re using a credit card, a funds hold is no skin off your back. But if you’re using a debit card, it means that your money is unavailable to use, which can cause problems if you need it. Also, some credit cards offer benefits on certain purchases. For example, you can often get rental car and other travel insurance coverage to help you save money when you’re on vacation. On the other hand, some merchants charge a fee if you use your credit card. For example, some utility companies may add a percentage of the transaction to your payment. Also, some gas stations may charge you a few more cents per gallon if you use a credit card.

Which Should You Choose?

If you only want one card to use for all your purchases, consider your priorities and the benefits and drawbacks of each card type before you choose one. Debit cards are a good choice if you struggle with overspending or just want to avoid that temptation completely. If you’re not as debt-averse, however, a credit card offers appealing features. Just be sure to pay off the balance in full to avoid interest and try not to use the card at merchants that tack on an added fee. If you already have both a debit and credit card, the best choice may be to use one for certain purchases and the other for the rest. Review the terms and features of both your cards to determine which to use in different situations. The better you understand the terms and what you need, the more likely you are to find a solution that works for you.

Originally published at www.chimebank.com on July 25, 2017.

You’re just starting to make some dough and you should start stashing it away in a bank account. But if you’re currently bankless, you might wonder how to choose a bank for the first time. What should you consider? Where do you even start? With so many options out there, how do you cut through the noise?

It’s not easy, but we’re here to break down the process to help you choose a bank for the first time. Take a look at our suggestions and you’ll be on your way to managing your hard-earned money:

Know your options

The good news is there’s no shortage of banking options out there. There really is something for everybody. The bad news is, it can be overwhelming to choose.

As a young adult, it’s tempting to want to hop on whatever bank your parents have. But you’re part of a new generation and your dad’s bank may not fit your lifestyle or needs.

When it comes to banking, you typically have three choices:

1. A retail bank. These are brick and mortar banks that typically have a variety of locations. Your “big banks” fall under this category and typically offer many financial products and services. These traditional retail banks may also have monthly maintenance fees, minimum fees, overdraft charges and ATM fees.

2. A credit union. Credit unions are like banks, but instead of being privately owned, they are non-profit organizations that are owned by their members. Credit unions offer many of the same products and services as banks, but they may be able to offer better rates.

3. An online bank. Online banks are financial institutions that don’t have any branches but offer banking capabilities via the Web and your smartphone. Because these online banks save money on physical locations, many of them have higher savings rates and lower fees than traditional banks.

With any of these options, you will be able to get a checking account and you can also opt for a savings account.

What to consider when choosing a bank

If you’re still wondering how to choose a bank, here are some additional considerations:

• Fees. Many banks have fees that you may not even be aware of, so read the fine print. As outlined above, retail banks commonly have fees and while these may seem minimal, they can add up.
• Accessibility. When it comes to managing your money, you want something that is easy for you. How easy is the setup process? Can you transfer money easily from a checking to a savings account? Does the bank have local branches in your area or can you access your account 24/7 online? Does the bank have online capabilities with a user-friendly website, as well as a mobile app? These are all things you should consider.
• Safety. Your money is a physical representation of your hard work, so you want to keep it safe, right? Check out reviews online about the banks you are considering and make sure they are backed by the Federal Deposit Insurance Corporation (FDIC). Under the FDIC, your balances are insured for up to $250,000.
• Transparency. Your bank is a big part of your financial life and you want to be able to trust your bank completely with your money. It’s important to look for banks that are transparent with how they make money and how they work to serve their customers. Several big banks in recent history have been under fire for slimy or fraudulent sales tactics, so be sure to do a bit of research on the bank’s history, reputation and business model.
• ATM access. If you need cash, will you be able to easily get some? You want to choose a bank that has ATMs in your area. If not, what are the ATM fees for using another bank’s cash machine? These fees can also add up, so be aware of how it can affect your bottom line.
• Support. If something goes wrong, how easy is it to get in touch with someone? Does the bank offer phone, email and social media support? You want to have a bank that has your back, no matter what happens.

How technology is changing the world of banking

Banking isn’t — and shouldn’t be — what it used to. Technology has single-handedly revolutionized how we manage our money. And that’s a good thing.

Banks used to be the only place where you could save, invest, or get a loan. But, with services like SoFi, Acorns, and others, you have more options than ever before. Today, you have so many choices that use technology to better handle your money. Why not look for banking options that give you a convenient and seamless experience?

On top of looking for a bank that makes the process easy, you’ll want to choose a bank that fits in with your needs and lifestyle. Here’s a pro tip: choose a bank that offers perks to keep you on track with your financial goals.

For example, at Chime, there are no monthly fees, overdraft fees, or minimum fees. Chime also has thousands of fee-free ATMs available for members and offers coverage for any unauthorized purchases. Most notably though, Chime empowers you to save money through its Automatic Savings program, which rounds up each transaction to the nearest dollar and transfers that money to your savings account.

Bottom line

If you’re on a quest to figure out how to choose a bank for the first time, don’t fret. The perfect bank for your lifestyle is out there — waiting for you. Just remember: before picking a bank, read the fine print and make sure you have ultimate control over your money. Your bank should be your ally, not your next frenemy.

Originally published at www.chimebank.com on June 4, 2017.

For most of us, saving money is hard.

In fact, 69% of Americans have less than $1,000 in savings, according to a survey by GOBankingRates. Saving money can be particularly challenging for millennials who are often saddled with student loan debt and just starting out in their careers. Even if you have a great job, you still might not earn enough money to save for your goals, like buying a house or starting an emergency fund.

So, how can you increase your earnings potential right now so you can save more money? Starting a side business from scratch is one possibility. However, this might not be realistic when you take into account your demanding job and limited funds. But, as the saying goes: Where there’s a will, there’s a way. Actually, there are 5 ways. Read on to learn how you can take advantage of the sharing and gig economies and start saving money right away:

1. Rent out a spare room on Airbnb.

This of course means you have a spare room in your apartment or house. If you do, consider fixing it up with some nice yet inexpensive decor (Target to the rescue!) and posting it on Airbnb. If you don’t have a spare room and live with roommates, you can still get creative by staying elsewhere and renting out your own room a few nights a month. I know you might dread this, but staying in your parents’ basement isn’t such a bad idea either if you’re only taking up residence there every other weekend and this translates into a few hundred bucks a month. Not so shabby.

2. Rent your car.

If you have a car and don’t use it much, consider listing it on Turo. According to Turo, if your car is worth $20,000 and you rent it out via the platform 15 days a month, you could earn $6,501 a year.

3. Hang out with four-legged friends.

If you’ve considered starting a dog walking business but you don’t have the time to market yourself, Rover and Dogvacay might offer the perfect solutions. These two apps allow you to list your hours of availability, set your rates and voila! — you’re in business. If you live in a dog-friendly house or apartment, you can even host dogs when their owners are on vacation and start your own hotel for dogs.

4. You’re in the driver’s seat.

Yup, driving for ridesharing services is an easy way to make some extra cash. Some good options: Uber, Lyft or Safr, which recently launched in Boston. Redefining ridesharing for women, Safr aims to provide safe transportation and job opportunities for women. According to the Safr website, it also pays more than other driving apps. If you don’t want to drive people around, what about food? More than 100,000 people are already signed up on Postmates to deliver — among other things — take-out meals from local restaurants to hungry patrons. According to Postmates, drivers can earn more than $25 an hour and set their own schedules.

5. Turn your skills and talents into fast cash.

If you enjoy doing household tasks and consider yourself a jack of all trades, you might consider signing on to TaskRabbit to offer house cleaning, furniture assembly, handyman or other services. You set your rates and choose to work hours that fit your schedule. As another option: If you do a bit of research, you might find a specialty app that will help you score side gigs. For example, I teach yoga and recently signed up on a new app called EasyPose. I entered in the types of yoga I teach and my availability. Students use the app to hire instructors who will come to their homes to teach private yoga sessions. Within a day, I had my first client.

As you can see, if you want to earn extra money to jumpstart your savings, you’ve got plenty of options. Yet, regardless of what type of gig works best for you, it’s important to keep your eye on your savings goals. To do this, it’s a good idea to stash away all of your earnings from your new side hustle into a savings account. Think of it this way: If you were able to get by on your full-time income before, anything extra is gravy.

If you find it hard to resist the temptation to spend your newfound income, here’s another tip: Automate your savings. Automating makes it easy for you to save without thinking about it. For example, with a Chime account, you’ll save money every time you use your Chime Visa Debit card to make a purchase. That’s right. When you use your card, your transaction will be rounded up to the nearest dollar and that rounded up amount will be transferred into your savings account. If you use your debit card twice a day on average, you’ll save about $400 a year.

Between automating and earning more money with a new side gig, your savings goals are now within reach. Are you ready to start manifesting more money today?

Originally published at www.chimebank.com on May 28, 2017.

It’s no secret that America’s big banks are raking in huge profits in fees. Last year they pocketed a cool $33 billion in overdraft fees alone. At almost every big bank, earnings are up, stock prices are rising, and those multi-million dollar CEO bonuses continue to climb higher. What we’re seeing is a massive redistribution of wealth in America. Big banks are fattening their pockets through sneaky fees that chip away at their own customers’ savings, in many cases without them even knowing about it.

Bank Fee Finder Report Exposes Hidden Fees

To shed light on the problem of bank fees, today BankFeeFinder.com unveiled a report exposing the impact of hidden bank fees on Americans. According to the report which analyzed data from over 5,000 U.S. bank customers, Americans pay $329 annually in bank fees on average. When you consider that half of households in this country have less than $500 in savings, the impact of this bank fee epidemic is even more problematic.

Part of the problem is due to the fact that people just aren’t aware of how much they’re paying in fees. A study by Common Cents found that people significantly underestimate how much they shell out in bank fees. Their research showed that people estimate they pay $5 in fees per month on average compared to data from Bank Fee Finder which shows people pay $27 in actual fees paid each month on average. That explains why many Bank Fee Finder users have been shocked to find out how much they’re really paying.

The BankFeeFinder.com report also breaks down bank fees by category including overdraft, monthly, ATM, and other fees. According to the report, overdraft is by far the largest fee category, with banks charging Americans an average of $250 each year. While a percentage of people paid no overdraft fees, those who did were charged an average $412. This sheds light on how banks made $33 billion in overdraft fees alone last year.

Millennials Besting Boomers

The report also found that fees increase with age. Average annual fees for Millennials, Gen X, and Boomers were $308, $401, and $413 respectively. College students paid only $212 in bank fees annually (46% less than the $329 annual average). This likely results from many banks offering introductory no or low fee accounts until students graduate.

Big Banks Rack Up Big Fees

The report also shed light on how the big banks rank in terms of average fees given 87% of the 5,000 reports summarized were from five major banks (Bank of America, CitiBank, JPMorgan Chase, Wells Fargo, and U.S. Bancorp). In terms of average annual fees by bank, Bank of America account holders paid the most in fees at $497/year, and this represented 23% of all reports generated. That’s 50% more than the next highest annual average which came from Wells Fargo customers who paid $302/year and nearly twice as much as the $265/year on average that Chase customers paid.

You can read the full report below or download it here. And if you’re wondering how much you’re paying in bank fees, you can find out for yourself at www.bankfeefinder.com.

Bank Fee Finder — April 2017 Report

Originally published at www.chimebank.com on April 27, 2017.

If you’re like me and you dread managing your finances, you’re not alone. It may not make you feel any better, but it turns out we have a good excuse. When it comes to dealing with financial decisions, our human brains simply aren’t wired for it. That’s according to scientists, aka behavioral economists who’ve uncovered the many ways in which we humans make seemingly irrational money mistakes in a fairly predictable fashion.

One of our major money follies: we just don’t save enough, and we can thank our tendency to optimize for the short term rather than the long term. A recent survey from the Institute for the Future found that 53 percent of Americans rarely or never think about something that might happen 30 years from today. This brain-glitch, which scientists call “temporal discounting,” is one the primary reasons why so many Americans today can count less than $500 in total savings.

So, how can you manage and save money when the odds are stacked against you? The answer: automation. In other words, set up a system that takes yourself out of day-to-day decisions about your finances so that you don’t have to think about them. With financial automation, you create a set of default money decisions that allow you to get out of your own way.

The best part: financial automation works! And we have the data to prove it.

Saving Automatically with Chime

In January of 2016, we announced our “Save When I Spend” feature, which automatically rounds up members’ Chime card transactions to the nearest dollar and transfers the round up to savings. We also reward those who opt-in to this feature with a 10 percent cash bonus on Round Ups each week. This feature quickly became one of the top reasons members love Chime.

Building on the success of “Save When I Spend”, we recently launched a new Automatic Savings feature called “Save When I Get Paid,” in beta. Using a “pay yourself first” approach, the new feature automatically transfers ten percent of a member’s’ paycheck to savings as soon as it arrives. One of the most important aspects of this feature was making it easy to get started and we designed it so that members can enroll in the program with one tap from the Chime app.

Automation Works and Here’s the Data to Prove it

We’re excited to share the initial results from our beta launch of “Save When I Get Paid”. The headline — those who’ve enrolled in Chime’s automatic savings programs saved over 3x per month more compared to members not enrolled in any automatic savings program. Here’s how much people saved during the February and March beta test by group:

• Members not enrolled in Chime’s automatic savings programs saved $113 per month on average.
• Members enrolled in “Save When I Spend” saved $217/month on average compared to those not enrolled (a 92% increase or almost 2x)
• Members enrolled in both “Save When I Spend” and “Save When I Get Paid” saved $382/month on average compared those not enrolled (a 240 percent increase or more than 3x)

Why Does It Matter?

While personal finance experts typically recommend having an emergency fund equal to three to six months of expenses, according to a recent study by GoBankingRates, most Americans have less than $500 in total savings. At the same time, most banks continue to rely on fees as a primary revenue source. In fact, the average American pays around $330 dollars in bank fees annually and the bank made over $33 Billion in overdraft fees alone in 2016.

We think that needs to change.

We designed our automatic savings program to help members overcome the hurdle of getting started with a healthy savings habit by making it nearly effortless to sign up, and even easier to keep up. By taking small steps, members are able to achieve their short-term savings goals such as creating an emergency fund or setting aside funds for a major purchase. We’re also proud to also help members avoid the typical bank fees that are chipping away at the savings potential of many Americans.

If you want to take the steps toward creating your own healthy financial future, we invite you to join Chime and stay tuned for more features to help you automate your finances. Based on member feedback from our the beta, we plan to introduce new automatic savings options such as allowing you to set a specific savings percentage for each paycheck.

How to Start: Automate Your Savings Today in 3-Steps

Step #1: Join Chime and you can start saving money automatically! Sign-up today.

Step #2: Enroll in Save When I Spend. Every time you pay a bill or make a purchase with your Chime card, we round up the transaction amount to the nearest dollar and transfer the round up from your Spending account into your Chime Savings account. Then every Friday, Chime pays a 10% bonus on your round ups for the week. Use your card just twice a day over the course of a year and you’ll have $400 in savings at the end of the year. Doesn’t get much easier than that.

Step #3: Enroll in Save When I Get Paid. First you’ll need to set up direct deposit by providing your employer with your Chime account number and bank routing number. You can find this information in the Chime mobile app by tapping “Move Money.” Then tap on the gear icon in the mobile app and enable “Save When I Get Paid.” Once enabled, 10% of every paycheck will be automatically transferred into your Chime Savings Account as soon as it arrives.

Originally published at www.chimebank.com on April 21, 2017.

Equal Pay Day lands on April 4 this year to symbolize how much longer women have to work in order to earn what men earned by December 31, 2016. There’s no single cause for the pay gap, which means there’s no silver bullet to closing the gap. But we can start by getting educated on the issue and who it impacts.

1. Women earn 83% of what men earn

In 2015, women earned 83% of what men earned, according to a Pew Research Center analysis of median hourly earnings of both full- and part-time U.S. workers. The 17-percent difference between men’s and women’s earnings means that women are paid less than roughly $4 for every $5 paid to men.

According to the Gender Pay Inequality Report put out by the United States Congress, a woman working full-time earns $10,800 less per year than a man, based on median annual earnings. This disparity can add up to close to a half million dollars over a career.

2. The pay gap is even worse for mothers

According to the American Association of University Women, Mothers must work an extra 155 days to catch up to their male counterparts.

Women with children are often pushed out of the workplace due to a lack of sufficient parental leave policies and flexible schedules. Those who do stay in the workforce are subjected to the “motherhood penalty” with which we will lose 4 percent in lifetime earnings, a figure purely attributable to bias against working mothers.

3. The gender gap grows with age

Women today begin their careers earning almost as much as their male colleagues. Those between the ages of 18 and 24 earn approximately 88 percent of what their male counterparts earn. After 35, the median earnings for women are 74–82 percent of what men are paid. Men are also 85 percent more likely than women to be VPs or C-Suite Execs by mid-career.

4. Women of color are most affected

The pay gap affects all women regardless of age, background, or education, however, women of color are disproportionately affected. According to a report by the National Women’s Law Center, Black women earn, on average, only 63 cents for every dollar paid to a man, while Native and Latina women earn even less, at 58 cents and 54 cents respectively.

6. The financial industry has the worst pay gap

Women who work in highly paid fields such as finance, public service, and medicine feel the most economic pain from the pay gap. According to PayScale, finance and insurance showed the largest pay gap with women earning 29% less than men. Healthcare and social assistance had the fourth highest gap, even though women held 80% of the jobs in this industry, illustrating that even female-dominated sectors can have a gender pay gap.

7. Education doesn’t impact the gender pay gap

While advanced education can be a path to increased earnings, it does not appear to mitigate the gender pay gap. At every level of academic achievement, women’s median earnings are less than men’s, and in some instances, the gender pay gap is larger at higher levels of education.

Women’s median earnings are lower at every level of education. In fact, women are often out-earned by men with less education: the typical woman with a graduate degree earns $5,000 less than the typical man with a bachelor’s degree.

8. The gender pay gap means more student debt for women

According to AAUW’s research report Graduating to a Pay Gap, between 2009 and 2012, men who graduated in the 2007–08 school year paid off an average of 44 percent of their student debt, while women in that group managed to pay off only 33 percent of their student debt. The gap in student loan repayment is even larger for black and Hispanic women with college degrees.

9. We’re still a long way off for pay equality

Although the gender pay gap in the United States has narrowed over time, if change continues at the same slow pace as it has done for the past fifty years, it will not close until 2059, according to the Institute for Women’s Policy Research. Hispanic women will have to wait until 2248 and Black women will wait until 2124 for equal pay.

10. Despite less pay, women-led companies perform 3X better than the SP500

Quantopian, a Boston-based trading platform based on crowdsourced algorithms, pitted the performance of Fortune 1000 companies that had women CEOs between 2002 and 2014 against the S&P 500’s performance during that same period. The comparison showed that the 80 women CEOs during those 12 years produced equity returns 226% better than the S&P 500.

Conclusion

The impact of women in the workplace can be seen at a broader level as well. According to the Council of Economic advisors, women’s increased participation in the paid labor force has been a major driver of economic growth in recent decades. In fact, they say the U.S. economy is $2 trillion bigger today than it would have been if women had not increased their participation and hours since 1970. That’s a lot of zeros! Imagine how much more our economy will grow when we close that gap once and for all.

Originally published at www.chimebank.com on April 4, 2017.