How To Get Better Rates And Higher Service From Banks

The best money market rate I've found online depends on timing. If you want to get better rates and higher services from banks, you need to develop a relationship and concentrate your assets.

Weeks before Lehman Brothers went bust on September 15, 2008, I decided to spread my savings out to various banks to hedge against risk. As you may recall, Bear Sterns was taken under that Spring and Washington Mutual was also in deep trouble and eventually gobbled up by Chase.

Now that my 5-year CDs have expired with First Republic Bank, I've begun consolidating my assets with Citibank to make things easier to manage. I've been with Citibank for the past 14 years. There is now risk I will lose some of my money given the amount is above the FDIC insurance coverage of $250K/$500k for singles and married couples, but I also don't think there's any chance in hell Citibank goes under now, especially since tier 1 capital ratios are now much higher as mandated by law. Besides, the economy is much stronger than it was five years ago.

Another reason why I'm not worried is because concentrating this amount of savings with one bank is only temporary. I know I'll be putting a hefty downpayment on a property this year. Furthermore, I'll be spending a good chunk of change on remodeling, which will bring my liquid savings down to a minimal amount again.

I think it's a good idea for everybody to shoot to have $250,000 in assets with one bank. $250,000 in assets includes savings, CDs, or investments. Based on my experience, once you're at the $250,000 asset mark or higher, I've noticed banks start treating you much better. If you have significantly more assets than $250,000, then I suggest having at least one other bank for convenience and safety. For example, I hate paying $3 ATM fees, so by having money spread across two major banks, the chances of me paying ATM fees goes down significantly.

Related: The Different Types Of Banks To Choose From

Five Benefits Of Consolidating Your Assets With One Bank

1) No more bank fees. Bank fees are irksome because they can hit you without you even knowing. One bank stuck me with a checking account fee of $25, which wiped my checking out to negative $16.75 because I only had $8.25 when the fee was charged. It was an orphan account that I opened up five years ago when I opened up my CDs. Thankfully, I got the fee removed due to my CD assets. I don't pay checking fees, overdraft fees, wire fees or credit card late fees anymore thanks to building up my loyalty and assets with one bank. I don't have to pay mutual fund fees anymore given I'm buying a different class of shares. I do need to hold the mutual funds for over one year though.

2) Friendlier bankers. I'm not sure if it's because I smile a lot, so other people are just forced to smile back at me, but as soon as the bank teller opens my account to deposit my check I can see her face light up a little. One teller slipped me her phone number and e-mail to get drinks after work. Another woman started asking me about summer travel plans and then proceeded to tell me her whole life story growing up in Florianopolis, Brazil and whether I'd like to meet up with her in Rio one summer. Then the bank manager swung by to see if I'd like to join a sushi making class with sake and dinner at one of their events. And then another banker asked whether I'd like to go to a SF Giants game after I was speaking with my wealth manager. People seem much more friendly when you've got a decent chunk of change with them. That feels good.

3) Higher savings rates. Although money market rates are pathetically low nowadays, I was offered a 3X bonus rate for the next three months because I had more than $25,000 on deposit. Based on the amount I had specifically, I would have made an extra ~$700. Not bad. For CDs, there's the normal rate, the jumbo rate, and the super jumbo rate based on amounts of around $50,000, $100,000, and $200,000 (varies by bank). But the rate spread between a super jumbo rate and a normal rate is often 0.25% or more.

4) Lower mortgage rates. Plenty of banks will lower your rate, usually in 0.125 increments if you have a certain amount of assets. For example, I was able to lock in a 2.5% jumbo 5/1 ARM with a 0.375% CREDIT because I crossed Citibank's $250,000 asset threshold. If I didn't, I would have got 2.625% or 2.75%, which still is pretty cheap. First Republic also has the same program, and I'm sure other big banks such as Bank Of America, Chase, and Wells Fargo.

You should still shop around for mortgage rates online with places like Credible because it's free and you can get five competing offers in minutes. It's a no-brainer to leverage the internet to make banks compete for your business.

5) Much better service. I'm really into good service because things come up all the time. I can e-mail my personal banker to handle requests such as opening or closing accounts, finding out if there are any specials, putting me in touch with an expert in a particular type of investment, getting me research reports, getting a mortgage going and so on. Given we've spent time together at a Giants game, we've developed a good relationship based on trust.

When she asked if I'd like to open up a $50,000 unsecured line I didn't need, I did because I knew it would help her. There's no 1-800 number I've got to weave my way through to get to a live person. If you like people returning your e-mails and phone calls, then focusing your assets will get you there.


One trick to really supercharging your savings is to identify what it is you are exactly saving for. For some, they are saving money to then throw it out the window by buying a car they can't afford.  For more prudent people, they are saving for a first home or a child's college education fund. Now you can add the above five banking related benefits on your list of motivations to save.

Attractive people get treated better – we all know that. But besides working out, buying nice clothes, and performing painful cosmetic surgery, there's not much one can do to change one's appearance to get treated better. But when it comes to accumulating more money, many more people can decide to save more, get another job, invest, take risks, and do all sorts of things. And once you get to the ~$250,000 asset threshold, the folks who handle your money will treat you better. Who knows? You just might get invited to the next sushi rolling dinner party.

Related: How To Get The Lowest Mortgage Interest Rate Possible

Wealth Building Recommendations

* Shop Around For A Mortgage: Credible offers some of the lowest refinance rates today because they have a huge network of lenders to pull from. If you're looking to buy a new home, get a HELOC, or refinance your existing mortgage, consider using Credible to get multiple offer comparisons in a matter of minutes. When banks compete, you win.

* Manage Your Finances In One Place: One of the best way to become financially independent and protect yourself is to get a handle on your finances by signing up with Personal Capital. They are a free online platform which aggregates all your financial accounts in one place so you can see where you can optimize your money. Before Personal Capital, I had to log into eight different systems to track 25+ difference accounts (brokerage, multiple banks, 401K, etc) to manage my finances on an Excel spreadsheet. Now, I can just log into Personal Capital to see how all my accounts are doing, including my net worth. I can also see how much I’m spending and saving every month through their cash flow tool.

Finally, they recently launched their amazing Retirement Planning Calculator that pulls in your real data and runs a Monte Carlo simulation to give you deep insights into your financial future. Personal Capital is free, and less than one minute to sign up. Ever since I started using the tools in 2012, I've been able to maximize my own net worth and see it grow tremendously.

Personal Capital Retirement Planner Tool

About The Author

41 thoughts on “How To Get Better Rates And Higher Service From Banks”

  1. InvestAsian

    Living abroad, I’ve come to realize how much banks in the U.S. rip people off. The fees from banks in most countries, from Europe, to Asia, to South America are extremely minimal. If I want to transfer money through a SWIFT transfer, I pay as little as $5.. and if instead of charging overdraft fees (which is basically asking for more of something that they know you don’t have), the transaction is simply denied.

  2. I do 98% of my banking online, so I don’t have much experience with dealing with actual people. I have noticed however, that because I’ve had the same bank account for over nearly 20 years now that I am getting more offers and incentives from them, including “no bank fees” like you mentioned.

  3. After putting it off forever, I recently opened an “high-yield” on-line savings account w/ GE Capital Retail Bank paying 0.95%. It was simple to open and simple to link it to my Fidelity cash account (paying just 0.01%).

  4. The First Million is the Hardest

    I rarely set foot in a bank anymore. I bank online with Schwab for my checking and most of my investments. I do keep a savings account in a local bank just for emergencies and the rare occasion where I need to deposit cash. I don’t know if it’s because I’m keeping more and more money with them, or if its a length of relationship thing, but Schwab did just increase my mobile deposit limit from 1k to 10k, so I guess that’s a perk. Otherwise I’ve never really been treated differently by any bank I’ve been with no matter how much or how little I kept with them. Of course I also don’t have 250k in any one spot, so that might change things, who knows.

    1. Man, I must be somewhat of a dinosaur, or just old school, b/c I enjoy stepping into a bank and saying hello. Kinda like Norm, in the TV show, “Cheers” perhaps.

      That is good they increased your mobile deposit to 10K from 1K. I think that is the main reason why I need to go to a bank b/c of my consulting paycheck, business paychecks, etc.

  5. Having great customer service makes such a difference. I’m working with my banker today to try and get a better interest rate on some money I need to hold liquid for the next few weeks.

  6. Sam,

    As always – great article.

    It’s been a while since I’ve been here.. Today, over brunch with friends and their son who is visiting from San Francisco where he lives, we got to talking about money. Of course I immediately thought of you and told my friends how I enjoyed reading your posts. That was at the time when you were still a mystery man and you created the Yakezie Challenge (I still have the emblem on my then active blog – which has been neglected for several years now). It was this incident today that led me visit.

    I’m sure you remember the Yakezie Challenge you threw out to your readers – who like you, were mostly bloggers in the personal finance space – was to get our Alexa ranking below 100K. You were well below that number by then, and I remember you mentioning that when you get below the 100K mark, things begin to happen – you begin to get unsolicited perks, such as people sending you books for review, etc.

    So I had to smile – first the internet, now the banks. $250K! You’ve given me a new target.

    Wishing you continued success in all your endeavors …

    Valentina … an old and continuing fan of yours who will be visiting these pages far more frequently again.

    1. Great to hear from you Valentina! Glad to see you are still plugging away online. So many folks have disappeared over the past five years! Funny how time flies and life changes, always.

      Best to you!

  7. Sam, I can see how this can be a benefit because of the treatment and added perks on occasion. I thought about doing this, but it does not fit my lifestyle and I would not be able to really take advantage of it.

    The reason I am with CapitalOne 360 formerly ING direct. Is because of they’re ATM fee structure, they charge no fees at any ATM and if a Bank ATM does charge you they reimburse you the fees. Also since I am a huge international traveler(I spend over 90% of my time overseas due to work and traveling for fun), they do not charge a foreign transaction fee for withdrawals on foreign cash. The first time I traveled overseas I was using my BofA card, I spent so much on that pesky foreign transaction fee and ATM fees. So this right here is a big perk for me considering my situation. Last year I got the CapitolOne silver credit card also, which gives a 1.5% cash back, no annual fee, also again no Foreign transaction fee which is just great for me. Also the 1.5% cash back on each purchase gives me a little more peace of mind for any slight exchange rate changes that could go against me.

    All I have to say is, everyone should do they’re research. See what features will benefit you and that you will need to save and avoid fees. I still keep my BofA account open since its a free account for me. Don’t use it much, but I have one direct deposit going into it. Its handy if I ever need to go into a brick and mortar bank, but I never really had too. Transferring money between my BofA account and CapitalOne 360 is great and clears pretty fast. I do not really have large assets but I am more than double your “net worth for the above average” chart for my age group. Most my assets sit at Vanguard diversified across several index funds.

    As my assets grow, later down the road it might be possible for me to try and start a relationship with a bank like Citi. Although I already do in a way, I have several credit cards from them that are tied to the ThankYou rewards program. I use it whenever needed… but its not my primary card to use if overseas, since they charge a foreign transaction fee. They only have one card on they’re line up that does not charge the FT fee, but its one that has a annual fee of about 95 dollars. It may not be worth me getting that one because my usage is probably not high enough to make it worth it.

    1. I like how you are able to get better rates for your mortgage and higher rates on CDs even though it may not be that much. For me tying up 250k would be more than half my net worth into one bank, this would not be really worth it. I could possibly move out of Vanguard and make this happen, but considering that Vanguard has some of the lowest fees in the mutual fund industry, it would not be worth it for me to do.

      Down the road when my assets reach 1 million plus this maybe a possibility though.

      1. Does cap one really reimburse fees charged by others for ATM usage? I am a cap 360 client and I have been charged a fee when I had no other option but to make a withdraw from an ATM that charted a fee. What is the process for reombursement?

        1. Sorry I stand corrected. I double checked and I can not seem to find in the new terms that they do reimburse ATM fees from other banks. There is an apple app that will help you find ATMs that are within the CapitolOne network that charge no fees, check the website out. I thought they did, but then again I honestly withdraw cash a handful of times a year. Since I stick to using a credit card as much as possible.

          A quick google search, and I see that Ally bank and USAA reimburses all ATM fees from out of network ATMs.

  8. I just use an online bank. I don’t get charged fees and my electronic transfers are free. I don’t need other services right now – like CDs, wires, etc. so it’s not an issue to me that I don’t get “deals” for them.

  9. You’re acting more like a corporate treasurer /CFO! Leverage it for all you can before you move it. I no longer have huge balances with my bank, but I leveraged for everything I could. I still use my longevity (over 40 years ) and a good relationship for freebies. It doesn’t hurt to go out of your way to form a relationship with the branch manager either.

  10. My thought on this is that I do NOT want to be a “good customer”. Good customers get invited to sushi roll and SF Giants tickets because they are making money for the bank; I would rather make it for myself. Consolidating for convenience is fine, but just a .1% increase in rate at another bank for $250,000 would pay for 83 $3 ATM fees, and do it every year. I don’t need a credit line, and don’t need any special treatment for a mortgage, credit cards or “free” wire transfers and money orders.

    Having worked for a bank in a past life, I can tell you the bank makes money on “bad” customers through fees, and “good” customers by paying lower deposit rates and charging higher credit rates. The marketing (FS, you are learning some of this in your new gig, yes?) focuses on PERCEIVED benefits like ATMs (really, how many times do you need emergency cash? and how many different ATMs have you used, in spite of the fact your institution may claim 1,000s for “convenience”?).

    While it may be flattering to get a phone# slipped to you from a cute young teller (Sam, that was very funny) let’s face it. It is another PERCEIVED benefit that discerning customers will realize quickly has a pretty big downside. Opening an unneeded credit line does help the bank employee, but not the customer; maybe that $50,000 unneeded and unused line impacted your available/utilized credit ratio and brought your score under 800?

    I don’t really care to answer “how is your day going?” type of small-talk while the branch staff do their best to differentiate themselves from the convenience and speed of internet and ATMs and keep their jobs a few years longer. And banking through any mutual fund family (Fidelity, T. Rowe and Vanguard have the lowest fees) can allow you to buy CDs without any brokerage fee from most any institution in the U.S. Picking the best rate is easy, laddering is easy, differentiating individual, joint, IRA Rollover, and after-tax CDs is easy, and best of all staying under the FDIC limit(s) is easy, with just a mouse-click.

    It’s cool if you want to leverage your money to make your financial institutions part of your social life and entertainment, but I’d rather have the money in my own pocket and my time to myself.

    1. What’s wrong with having all of the above?

      I really enjoy camaraderie. If I feel like my bankers are on my side, I will be a client for life. So far, USAA (20 years) and Citibank (14 years) have made me feel this way. I’ve got an overseas abduction story to share in the future that helped cement my loyalty.

      The small gestures go A LONG way in the service business.

  11. I get anxious if I have to much in any one spot. We bank at a regional bank and I am almost certain that some of my friends would check out my checking and savings just because they can. I don’t want to offer up a complete picture for them. To be honest, this also kind of scares me about platforms like personal capital but I don’t know anyone there and don’t link everything.

    I have talked to tellers who tell me they have absolutely checked out peoples accounts just for fun.

    1. There’s NO DOUBT that tellers will check a client’s account out b/c that’s part of their job… the issue is if they gossip with other people about your money. That’s bad, and if you live in a small town, that’s worse.

      So long as you are under $250K, I wouldn’t sweat it.

  12. If you hate $3 ATM fees consider a Schwab High Yield Investor checking has no ATM fees, reimburses ATM fees charged by the ATM, has great international exchange rates, and no fees to open. I travel for work and love it so much to be able to walk into any airport in the world and take out some carry cash with no exchange fee or ATM fee. I get a rate I know is as good if not better than a travel exchange (comparison by a blog) , cash which is not likely not counterfeit (coworker go counterfeits at an exchange at an airport), and there is no hassle at all.

    I am not affiliated with Schwab at all, it’s just an amazing account to have and I’m surprised people complain about ATM fees when such a simple option exists.

  13. I chuckled when you talked about how the teller slipped you her phone number and the manager invited you to a sushi rolling dinner party. Just by having so much business to offer them they want to do everything they can to keep you.

    I don’t think there is too much to worry about in terms of losing money, especiallly if you don’t plan on keeping a balance over the FDIC insurance coverage amount.

    Great article which provides some more motivation for me going forward!

  14. I haven’t been inside a physical bank in 10+ years. With mobile check deposit, online account management, and 24/7 customer service lines, why bank anywhere but online? I also haven’t seen a fee in 10+ years. My policy is thus: if I am ever charged a fee with a bank, or there are minimum account balances to keep, or I have to pay an ATM fee to access MY money, I leave. USAA has treated me and my money the best for 10 years. However, if they every got rid of free checking, I would leave for Schwab or any of the other fee free banks. Also, I would never keep more than 250k at any one bank. 2008 proved that even the giants can fall!

    1. Wow, 10 years you haven’t stepped foot into a bank? That is amazing.

      Is there no deposit limit amount per check w/ USAA? I’ve seen $1,000 check deposit limits with banking apps before.

      I’m a USAA customer as well, and have my insurance with them and several CDs.

  15. I go with the on-line banks. No fees, much higher APR than bricks or mortar banks. I estimate that between no fees and higher interest rates, I am about $8000 better off and that is without factoring what I have earned on that 8K. I am just under the 250K level with one bank for savings while I use the other for it’s awesome platform for checking. I don’t need a banker to smile at me. Just looking for the best deal economically.

  16. Probably one of the best ways to have better rates could be threatening to leave?
    Then again this may depend on how much you have with that bank.
    Great tips and tricks

  17. Sam,

    Good post. I would recommend an on-line bank. Several years ago, for whatever reason, my firm lost it’s special “deal” with Wells Fargo. What was a completely free checking and savings account now was going to cost me over $60 a month based on my ATM usage and fees for checking. This happened after they sent a letter that said nothing unless you had a microscope and read the footnotes. I called, complained loudly and had the fees removed.

    My next step was to open an account on-line with ING. A fantastic platform, no fees (not yet anyway. I am suspicious that Capital One, who acquired ING’s retail business, will go down that road in another year or so.) and an interest rate well above, even 3x above, a traditional bricks and mortar bank for money market savings. That was 5 years ago. I figure my savings on fees alone has been around $3700. Then, factor in the interest gain which I approximate has netted me an extra $5000 over the last 5 years (a low estimate) and now we are talking real money.

    13 months ago, I transferred the bulk of my savings to Barclays because the apr was .25% higher than ING. It is only .15% higher than ING now but I am right below the 250K level which is enough to make the difference meaningful. My point is that everyone should be looking away from the traditional banks. People are paying for their overhead. I say let others do that and I will do where my money earns more. I still have the comfort of FDIC insurance and I don’t need to have a banker smile at me. I will take the extra money all day long.

  18. ChicagoBarb

    The best thing that I have had regarding banking is Gold with Citibank. My parents linked my account to one of theirs while I was in high school so that I was also a gold member. My parents also wanted me to have access to some of their money in case of a tragedy occurred (my parents dying while on vacation and I had to get their bodies back). I had a issue in ’08 bc I made Gold myself before buying my place, but lost it when I took the money out for the mortgage. My mother (Happy Mother’s Day) had to call Citibank and link me back on for my Gold status. When the recession hit in ’09 you no longer need 100K for gold at Citibank and I could eventually make the money myself as it was 60K. The teller once tried to charge me for a money order, but I reminded her that I was a Gold customer. I wonder what Gold status is now since I am thinking of paying off my mortgage now.
    I also feel Gold makes bankers provide better service at the bank. I get great service. When my wallet was stolen and I cancelled the card by phone, but noticed charges afterwards, I went into my local bank and the personal banker took care of it knowing I was a great customer. I’ve never had to pay for money orders or cashier’s checks that I use to pay my Chicago taxes (Chicago is notorious for losing tax documents, so this gives me added paperwork showing that I did pay my property taxes). People next to me at the bank look at me bc they were just charged and I was not! I get more ThankYou points per month being Gold. When I come into the bank, they know me. I only go in there for cash that is smaller than 20s, but then again, I rarely use cash anyways.
    One of my co-workers says that he has 100K in a bank and was invited to the Bulls game in a private box because of it.
    Being a female Gold member, I have been given a gift through the mail (a purse hook) and been invited to a few things at the bank.

  19. How do you get free wire transfer from a bank? I have to pay $45 international wire transfer fee all the tie. I have ~500k with wells fargo, and I don’t get free stuffs from them. Maybe I should look for another bank?

    1. If you ask, and they say “no,” then definitely.

      I do a wire maybe once in a blue moon, so to Citibank it’s no big deal. If you are a wire transferring machine, then it may not fly understandably.

      1. Yup, I do like 10-20 a month on my business acct. I heard some banks to some kinds of membership where you pay a flat rate a month and can do unlimited wire transfer. I probably need to look into that. I pay hundreds on wire transfer fee if not thousand a month.

Leave a Comment

Your email address will not be published. Required fields are marked *