7 Finance “Secrets” You’ll Never Learn from the Bank Teller
Don’t at all think the word “teller” means to inform you. It comes from the Old English (stuff Shakespeare would say) word “tellan” which means “to calculate, count or consider”, not dispelling information. So when a bank teller is busy counting bills, don’t assume it’s their job to clue you in on the best financial practices. It really isn’t.
Since they’re not financial advisors, they may not have the authority to dish out such information to begin with. But don’t get upset with your institution. Most of the secrets they won’t tell you about banking are out in the open anyway, and we’re here to shine some light on them. So prepare to take some notes.
1. Exchanging currency comes with fees you don’t have to pay
The Canadian dollar is in the dumps these days. If you’ve travelled to the U.S. or Europe this year, you know the pain that came with converting your hard earned Canadian bills into Americans, Euros, or Pounds – you lost big time. And if you’re about to travel, brace yourselves. But the losses don’t end there. Exchanging currency comes with hidden fees that you don’t have to pay.
Generally, Canadian banks charge as much as 3% in fees in addition to the current exchange rate. And there could be an additional mark-up that reaches 9%. You won’t see these charges on your receipt, however, because they’re factored into the exchange rate, making it hard to figure out. The fix is avoiding the bank completely. There are alternatives out there such as, a no-foreign transaction fee card which you can use if you plan to do some shopping while traveling abroad.
2. You CAN have annoying fees waived if you’re a loyal customer
Are fees a necessary evil? Perhaps. We won’t argue the fact that no one can escape them completely. However, we will say that many fees which seem like unavoidable payments, are actually avoidable if you just ask. Banks tend to treat their customers like this – they give new ones a bunch of incentives in the hopes of keeping them for life, while they keep the long-time customers by giving them “breaks”. For example, if you’ve been banking with your institution for some time now, you can have certain fees waived off. But a bank will not tell you that outright.
Why would they? If they can pull in as much money through those hidden fees that you won’t notice or assume is mandatory, why would they pass that up? Nevertheless, you can have fees waived. For example, an overdraft fee is something you can negotiate providing you’re not always going in the red. Accidental overdrafts happen, and you may get charged for it. If this isn’t the norm for you, you can actually call your bank to have it waived. It may sound bold, but you have the right to do it.
3. The advice to open a new account isn’t always in your best interest
We don’t want to villainize bank tellers here, but they’re not necessarily looking out for you if they advise you to open a new account. They’re often covering their own tails. Here’s the reality – a teller is not only a customer service representative, they also have duties of a salesperson. Bank managers are often looking to see how many “products” (lines of credit, mutual funds etc.) the tellers can sell as a measure of their performance.
With that said, it doesn’t mean these accounts are unnecessary – many of them are beneficial if used correctly. But understand that some of these products are sold to you to make the tellers look good in front of their bosses. It’s kind of like police officers and tickets – there’s a quota to meet. Before you crucify them, keep in mind that it’s part of their job. It’s just one of those things they can’t tell you.
4. The teller you trust the most may not be there much longer
Is there a teller at your bank who is like your financial BFF? They could be among the rare ones who give you little hints to save cash and avoid hidden fees. We regret to tell you this, but they may not be in your life forever. It has nothing to do with them telling you advice that they don’t have to tell you. It has more to do with opportunity. The good bankers are often on the move, seeking out higher positions within the institution they work at, or more attractive offers at other banks.
This may not seem important, but it is. Building a good rapport with a teller can open you up to information that’s usually not given. So the day you walk into your bank looking for Joe or Julie and don’t find them, could be the day your source of money secrets dries up. It’s sad but worth knowing.
5. The person who determines your loan approval may not be a person…
Here’s an interesting piece of info. When someone gets rejected for a loan and vows revenge on the lender (how’d they do this, we don’t know), they’re actually directing their anger to the wrong entity. We say entity, because computers now decide whether a person is qualified for a loan or not. For the past few years, lenders have been using algorithms to sift out the people who qualify for loans and those who don’t. That’s not necessarily a bad thing. It’s another example of how much we depend on technology to get things done, but there is a “sliver of darkness” in that regard.
Algorithms are only as reliable as the people who program them. If human lenders inaccurately interpret credit information – errors and technicalities can lead to this – who’s to say an algorithm can’t make the same mistake? After all, they churn out results based on what they see just like humans do. And there’s plenty of evidence to suggest that algorithms can be just as biased as people.
6. Your bank isn’t the only place to get a loan
Admittedly, this isn’t really a secret. You’re probably already familiar with third-party companies that offer loans, whether it’s for cars, businesses or some other purpose. But the bank wouldn’t sabotage themselves by telling their clients about loan opportunities elsewhere. The purpose of mentioning this here, however, is to remind you that the bank is not your only option for financing.
And if you’re someone with less-than-stellar credit and is in the subprime market, a bank might not even cater to you to begin with. If you’re funding a small business, you may have a more difficult time finding a loan through a bank because of the regulations that reduce the risk for the institution. In such instances, it would be better to seek financing through a third-party company suited to individuals with unique circumstances and challenges.
7. A low interest rate isn’t the end-all and be-all of a loan or credit account
What are the three “i’s” of lending? Interest, interest, interest! It’s the main thing that has everyone on edge, considering how much it compounds and puts people into debt. And yet, a low interest rate doesn’t make a loan or mortgage a good one. Yep, we said it. That may seem like a blasphemous statement, but there’s more to a loan than its interest rate.
Don’t get the wrong idea here – a low rate is usually a blessing. However, the terms of a loan or mortgage can be restricted, making them difficult to manage even if they may have a lower interest rate than other financing option. Unfortunately, too many people focus solely on interest rates, and this makes it easy for banks to sell such individuals loans that may not be ideal. Make this a lesson to yourself: the best loans are the most flexible, even if they come with a slightly higher interest rate.
A Tell-All You Won’t Get from the Bank
Does this mean a bank teller is a sneaky, self-centered individual who wants to rob you of your money? Not at all! Remember, a teller is not an advisor, and they are at the mercy of their supervisors and managers. Many of you have probably had the experience of meeting a bank teller who gave you a money-saving tip, and it’s great to meet them. But keep in mind that it’s not their job to sit and discuss what direction you should go in financially.
In fact, if the questions you ask get too heavy-handed, they’ll openly tell you that it’s best to speak with a financial advisor. It may seem discouraging that you sometimes have to learn about how banks operate from outside sources, but they won’t call themselves out on things they know would frustrate their customers. Fortunately, this info is right in your hands thanks to the internet. With the info we’ve listed in this post, you can now walk into a bank without having to take everything they say to heart. They can’t trick you forever!