We report regularly on deposit rates and fees, national APY, and banking pricing strategies. However, that’s only part of the overall picture. There was a lot going on in the world of banking this year, and the Huffington Post recently report on eight positive trends for consumers from 2010:
1. Mortgage rates his a new low at an average of 4.69 percent for the first eleven months of the year. Historically, rates for a 30-year mortgage have averaged around 8.91%. The new low rates continue to fuel a flurry of refinancing if not new mortgage purchases.
2. Financial reform continues to be headline news. The Dodd-Frank Wall Street Reform and Consumer Protection Act offered some benefits to consumer, primarily in the form of greater stability and security. On the downside, higher compliance costs may mean an increase in fees and continued lower interest rates on CDs, savings, and money market accounts.
3. More than 30 million consumers opted out of overdraft protection. Although a huge profit center for many banks, new rules allowed depositors to bow out of overdraft fees and many did.
4. Free checking continues. Despite predictions that added compliance overhead from Dodd-Frank sound the death knell of free checking, availability only dropped 11 percent.
5. The FDIC insurance increase was made permanent, rising from $100,000 per depositor to $250,000 per depositor.
6. Other dollar limits for FDIC insurance were increased, including non-interest bearing accounts such as checking, which do not count against the $250,000 limit for interest accounts. This makes it easier for consumers to have multiple products at the same bank without exceeding their insurance limits.
7. Consumers finally started to fight back against credit card debt. As we have reported earlier, consumers have been using their maturing CDs to pay down credit card debt, which accounts for Federal Reserve figures that continue to show that credit card debt decreased for the second year in a row.
8. And Americans are saving more. Our research shows that overall deposits are up and the Federal Reserve reports that savings deposits increased more than $400 billion during the first 10 months of 2010.
Here’s wishing us all a more profitable and prosperous 2011.