Should I put my money in the bank or a cookie jar? Seriously!

NEW -> Contingent Buyer Assistance Program
[quote author="jimmeth" date=1221464018]I've had the same checking account since high school... started out as Coast Federal Bank, which was acquired by Great Western Bank, which quickly became Washington Mutual. I'm pretty worried about my savings becoming worth less and less before I get the chance to finally buy a home.



I'm heeding the warning now to spread around my savings/down payment. How does one go about exchanging money into a different currency in a foreign bank? Can it be done through an investment firm like Fidelity? Can it be done through a credit union or a bank like Farmers and Merchants?</blockquote>


I'm not sure foreign banks have that same protection for US depositors. I'd still with spreading your savings over 2-3 very large banks like Wells Fargo, BofA and US Bank, unless things change rapidly. Wamu is toast. A larger local credit union is also a good place since they didn't do the crazy loans these banks did. You could also open multiple FDIC insured accounts with Fidelity, they aren't going anywhere.
 
[quote author="jimmeth" date=1221464018]I've had the same checking account since high school... started out as Coast Federal Bank, which was acquired by Great Western Bank, which quickly became Washington Mutual. I'm pretty worried about my savings becoming worth less and less before I get the chance to finally buy a home.



I'm heeding the warning now to spread around my savings/down payment. How does one go about exchanging money into a different currency in a foreign bank? Can it be done through an investment firm like Fidelity? Can it be done through a credit union or a bank like Farmers and Merchants?</blockquote>
Just be careful when you change your money over to a foreign currency.

Usually they hit you with front-end and back-end fees.
 
[quote author="CalGal" date=1221464552][quote author="jimmeth" date=1221464018]I've had the same checking account since high school... started out as Coast Federal Bank, which was acquired by Great Western Bank, which quickly became Washington Mutual. I'm pretty worried about my savings becoming worth less and less before I get the chance to finally buy a home.



I'm heeding the warning now to spread around my savings/down payment. How does one go about exchanging money into a different currency in a foreign bank? Can it be done through an investment firm like Fidelity? Can it be done through a credit union or a bank like Farmers and Merchants?</blockquote>
Just be careful when you change your money over to a foreign currency.

Usually they hit you with front-end and back-end fees.</blockquote>


You can buy foreign bond funds but as the dollar goes higher it will hurt these funds. I'd stick with an FDIC savings account or money market fund from a low fee brokerage firm.
 
WAMU isn't going down!! I was just there yesterday morning! The line was almost OUT THE DOOR with people eager to throw their money in 12 month CD's at 5.00% APY!



I was in line to close my account, and all I kept hearing was, "I'm here to open up a 12 month CD, where do I go?"



I was so tempted to say, "Out the door", but I managed to shut my lips.
 
On a side note, I also stopped by Farmers and Merchant to open up an account, their rates for CD's suck, but what can you expect from a "safe" bank.



If you open a checking, tell them you want the promotion, I believe if you open a checking with $500 minimum you get a GPS thingymajiggy. I don't know, I heard it on my way out! Drats.
 
Thanks for the info, Shooby. However, I am confused. If anything doesn't this seem like a sign of desperation / last-ditch efforts from Wamu? Correct me if I'm wrong (I know someone will!) ... but when Wamu offers a higher yield CD, their profit margin is going down as they continue to take hit after hit from bad loans. It reminds me the old tale of the boy sticking his finger in the hole in the dyke to hold back the water.
 
[quote author="SoCal78" date=1221523228]Thanks for the info, Shooby. However, I am confused. If anything doesn't this seem like a sign of desperation / last-ditch efforts from Wamu? Correct me if I'm wrong (I know someone will!) ... but when Wamu offers a higher yield CD, their profit margin is going down as they continue to take hit after hit from bad loans. It reminds me the old tale of the boy sticking his finger in the hole in the dyke to hold back the water.</blockquote>


Yes, that is exactly what it is like. This is also one of the reasons mortgage interest rates will likely rise. The short-term borrowing costs of banks is rising. Banks borrow short and lend long. If short term costs rise, they must raise long-term rates, or they will lose even more money and go out of business (which WAMU probably will).
 
[quote author="IrvineRenter" date=1221526279][quote author="SoCal78" date=1221523228]Thanks for the info, Shooby. However, I am confused. If anything doesn't this seem like a sign of desperation / last-ditch efforts from Wamu? Correct me if I'm wrong (I know someone will!) ... but when Wamu offers a higher yield CD, their profit margin is going down as they continue to take hit after hit from bad loans. It reminds me the old tale of the boy sticking his finger in the hole in the dyke to hold back the water.</blockquote>


Yes, that is exactly what it is like. This is also one of the reasons mortgage interest rates will likely rise. The short-term borrowing costs of banks is rising. Banks borrow short and lend long. If short term costs rise, they must raise long-term rates, or they will lose even more money and go out of business (which WAMU probably will).</blockquote>


I agree. Don't be suprised if at some point in 2010 morgate interest rates are in double digits. Around 8-9% is a given in my opinion.



So if you are waiting to buy a home in a year or two when prices are most likely going to be lower, chances are your monthly payment will be close to what it could be if you bought now.



Keep in mind though....It is far better to buy a home for less and higher interest then for more and lower interest.



Excluding taxes/fees/PMI etc... 600K home @ 5.5% = 3406 payment. 400K @ 9.75% = 3436 payment.



The point being here is that your property taxes will be lower, bigger tax deductions and you can ALWAYS re-finance when rates drop. You can't change the price of your home once you buy it...Neither can you change your property tax.



So personally yeah, I would be a happy camper if prices of homes continue to drop and rates stay low. But if they do raise rates (which they will) it will only put more pressure on prices of homes. Something has to give.



BV
 
[quote author="blackvault" date=1221527869][quote author="IrvineRenter" date=1221526279][quote author="SoCal78" date=1221523228]Thanks for the info, Shooby. However, I am confused. If anything doesn't this seem like a sign of desperation / last-ditch efforts from Wamu? Correct me if I'm wrong (I know someone will!) ... but when Wamu offers a higher yield CD, their profit margin is going down as they continue to take hit after hit from bad loans. It reminds me the old tale of the boy sticking his finger in the hole in the dyke to hold back the water.</blockquote>


Yes, that is exactly what it is like. This is also one of the reasons mortgage interest rates will likely rise. The short-term borrowing costs of banks is rising. Banks borrow short and lend long. If short term costs rise, they must raise long-term rates, or they will lose even more money and go out of business (which WAMU probably will).</blockquote>


I agree. Don't be suprised if at some point in 2010 morgate interest rates are in double digits. Around 8-9% is a given in my opinion.



So if you are waiting to buy a home in a year or two when prices are most likely going to be lower, chances are your monthly payment will be close to what it could be if you bought now.



Keep in mind though....It is far better to buy a home for less and higher interest then for more and lower interest.



Excluding taxes/fees/PMI etc... 600K home @ 5.5% = 3406 payment. 400K @ 9.75% = 3436 payment.



The point being here is that your property taxes will be lower, bigger tax deductions and you can ALWAYS re-finance when rates drop. You can't change the price of your home once you buy it...Neither can you change your property tax.



So personally yeah, I would be a happy camper if prices of homes continue to drop and rates stay low. But if they do raise rates (which they will) it will only put more pressure on prices of homes. Something has to give.



BV</blockquote>


Once again Blackvault is spot on. Except he says things with more clarity and completion than I can.
 
Hi thanks for all the responses and advice again. I have withdrawn all my $ from Wamu and put it in 3 different banks. I just hope that I am not making a mistake because Paulson seems to have a plan now to save the economy. It was tough to forgo my high interest paying accounts and opted for sth. much, much lower at other banks. :roll:
 
It's better than having a 4-5 month wait to get your cash out if something happened to WAMU. And I don't see what you could lose, you might actually be gaining some sleep now. Once the crisis averts you can always go back to risky investments.
 
[quote author="norcaljeff" date=1221826537]It's better than having a 4-5 month wait to get your cash out if something happened to WAMU. And I don't see what you could lose, you might actually be gaining some sleep now. Once the crisis averts you can always go back to risky investments.</blockquote>


I know... But I was just calculating the hundreds I will lose by switching banks per month. That's my gas money right there! Or if I saved up the hundreds, then I can go to South Coast Plaza and buy myself an authentic LV or Gucci bag! ;-)
 
[quote author="Allison C." date=1221865761]Or if I saved up the hundreds, then I can go to South Coast Plaza and buy myself an authentic LV or Gucci bag! ;-)</blockquote>
You're gonna get bkshopper started again.



And aren't those bags like in the thousands now?
 
[quote author="irvine_home_owner" date=1221867534][quote author="Allison C." date=1221865761]Or if I saved up the hundreds, then I can go to South Coast Plaza and buy myself an authentic LV or Gucci bag! ;-)</blockquote>
You're gonna get bkshopper started again.



And aren't those bags like in the thousands now?</blockquote>
You can still get them for under $1k.

It just depends on the size of the bag.
 
[quote author="CalGal" date=1221874851][quote author="irvine_home_owner" date=1221867534][quote author="Allison C." date=1221865761]Or if I saved up the hundreds, then I can go to South Coast Plaza and buy myself an authentic LV or Gucci bag! ;-)</blockquote>
You're gonna get bkshopper started again.



And aren't those bags like in the thousands now?</blockquote>
You can still get them for under $1k.

It just depends on the size of the bag.</blockquote>


<em>Not the size</em>, the <em>material</em> of the bag determines the cost. For example--you can get a duffle bag for less than an evening bag. The evening bag may be the size of a football, but if it's made of an exotic skin or has beadwork, it's significantly more expensive than a suitcase. For your average, everyday handbag--leather will always be more than the original GG fabric. Size has very little to do with the cost.
 
[quote author="BMP 309" date=1221876248][quote author="CalGal" date=1221874851][quote author="irvine_home_owner" date=1221867534][quote author="Allison C." date=1221865761]Or if I saved up the hundreds, then I can go to South Coast Plaza and buy myself an authentic LV or Gucci bag! ;-)</blockquote>
You're gonna get bkshopper started again.



And aren't those bags like in the thousands now?</blockquote>
You can still get them for under $1k.

It just depends on the size of the bag.</blockquote>


<em>Not the size</em>, the <em>material</em> of the bag determines the cost. For example--you can get a duffle bag for less than an evening bag. The evening bag may be the size of a football, but if it's made of an exotic skin or has beadwork, it's significantly more expensive than a suitcase. For your average, everyday handbag--leather will always be more than the original GG fabric. Size has very little to do with the cost.</blockquote>


you mean like this $45K LV bag that Beyonce ordered? :cheese:
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[quote author="BMP 309" date=1221876248][quote author="CalGal" date=1221874851][quote author="irvine_home_owner" date=1221867534][quote author="Allison C." date=1221865761]Or if I saved up the hundreds, then I can go to South Coast Plaza and buy myself an authentic LV or Gucci bag! ;-)</blockquote>
You're gonna get bkshopper started again.



And aren't those bags like in the thousands now?</blockquote>
You can still get them for under $1k.

It just depends on the size of the bag.</blockquote>


<em>Not the size</em>, the <em>material</em> of the bag determines the cost. For example--you can get a duffle bag for less than an evening bag. The evening bag may be the size of a football, but if it's made of an exotic skin or has beadwork, it's significantly more expensive than a suitcase. For your average, everyday handbag--leather will always be more than the original GG fabric. Size has very little to do with the cost.</blockquote>
But you can still get them for under $1k.
 
[quote author="CalGal" date=1221882494][quote author="BMP 309" date=1221876248][quote author="CalGal" date=1221874851][quote author="irvine_home_owner" date=1221867534][quote author="Allison C." date=1221865761]Or if I saved up the hundreds, then I can go to South Coast Plaza and buy myself an authentic LV or Gucci bag! ;-)</blockquote>
You're gonna get bkshopper started again.



And aren't those bags like in the thousands now?</blockquote>
You can still get them for under $1k.

It just depends on the size of the bag.</blockquote>


<em>Not the size</em>, the <em>material</em> of the bag determines the cost. For example--you can get a duffle bag for less than an evening bag. The evening bag may be the size of a football, but if it's made of an exotic skin or has beadwork, it's significantly more expensive than a suitcase. For your average, everyday handbag--leather will always be more than the original GG fabric. Size has very little to do with the cost.</blockquote>
But you can still get them for under $1k.</blockquote>


Of course! :)
 
[quote author="Allison C." date=1221865761][quote author="norcaljeff" date=1221826537]It's better than having a 4-5 month wait to get your cash out if something happened to WAMU. And I don't see what you could lose, you might actually be gaining some sleep now. Once the crisis averts you can always go back to risky investments.</blockquote>


I know... But I was just calculating the hundreds I will lose by switching banks per month. That's my gas money right there! Or if I saved up the hundreds, then I can go to South Coast Plaza and buy myself an authentic LV or Gucci bag! ;-)</blockquote>


Wow, just like a girl :) It's like talking to my ex. (sigh) On one hand you're complaining about losing money and the next you're complaining you can't spend it on a purse! Well after this ridiculous government bailout you can pretty much put your money back into whatever bank you want cuz uncle sammy is drunk again and has lost his mind. Buy some Bershire. That damn stock is the safest investment on the planet and it jumped 15% today, or $20k. It's absolutely insane. The market should dip again next week, this rally way way too fast and too high.
 
[quote author="norcaljeff" date=1221904878][quote author="Allison C." date=1221865761][quote author="norcaljeff" date=1221826537]It's better than having a 4-5 month wait to get your cash out if something happened to WAMU. And I don't see what you could lose, you might actually be gaining some sleep now. Once the crisis averts you can always go back to risky investments.</blockquote>


I know... But I was just calculating the hundreds I will lose by switching banks per month. That's my gas money right there! Or if I saved up the hundreds, then I can go to South Coast Plaza and buy myself an authentic LV or Gucci bag! ;-)</blockquote>


Wow, just like a girl :) It's like talking to my ex. (sigh) On one hand you're complaining about losing money and the next you're complaining you can't spend it on a purse! Well after this ridiculous government bailout you can pretty much put your money back into whatever bank you want cuz uncle sammy is drunk again and has lost his mind. Buy some Bershire. That damn stock is the safest investment on the planet and it jumped 15% today, or $20k. It's absolutely insane. The market should dip again next week, this rally way way too fast and too high.</blockquote>


I was just kidding about the bags. I practically grew up with designer handbags. My aunt is a shopaholic/VIP at these stores. IMO, I don't see the need to spend that much on a purse. Me, I like my LeSportsac just fine.

I do agree with your last comment though. Maybe there'll be some surprise development this weekend??

(BRK-A? What is it? I checked it out, is it in US dollars? :bug: :ahhh: )
 
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