The coronavirus pandemic has wreaked havoc on the economy, leaving a record number of unemployed Americans scrambling to meet their financial obligations. For many, the daily ritual of checking the mailbox for the $1200 stimulus checks they’re scheduled to receive from the Federal government is one more frustration piled onto the disruption of their daily lives and the fear of contracting the virus itself. But there’s another question outstanding: when your check arrives, what are you going to do it? And by that we mean, not how are you going spend it, but how will you gain access the money you receive?
Germaphobes May Be on to Something
People who already have direct deposit set up with the government will receive their checks electronically, of course. And they may spend it the same way, using the online bill pay features their banks offer. But some will be tempted to withdraw their stimulus funds in cash. A crisis of this magnitude brings out some very deep-seated fears. Having cash on hand might seem like a good idea to some. And it may even quell some of the anxiety they’re experiencing. But research suggests that handling physical currency represents a risk as grave as the coronavirus itself.
Some studies have found that the coronavirus can survive on paper for up to 5 days. Government experts warn that it can live on such surfaces as plastic and stainless steel for up to three days. Withdrawing cash from the bank—even if you use a drive-up teller or ATM to do so—can’t abolish your risk of exposure to the virus. It’s entirely possible that the teller who handled your money was infected when he or she counted out your bills and put them in an envelope for you. You also don’t know how many people used the ATM you visit before you. What was lurking on their fingertips? Did they cough while keying in their passwords? Cash and the means we use to access it have become a conceivable carrier of a deadly disease.
In the past, we might have just humored or even made fun of the germophobes in our lives. But nowadays, we’re all rethinking our hygiene habits. During the early days of the pandemic, hand sanitizer was a precious commodity. Now we’re keeping it in our cars and conscientiously using it on those rare days when we do visit the grocery or home improvement store.
But an economic trend has also emerged as the world tries to creatively cope with the pandemic. Consumers and businesses alike are increasingly turning to innovative technologies—those that don’t require contact between human beings—to transact business. More retailers are gearing up to accept electronic payment through applications like ApplePay and GooglePay, which allow customers to pay using their smartphones while keeping a safe distance and avoiding surfaces that may be harboring the virus. Keep an eye on this trend. Anything that affords consumers more convenience is pretty much destined to catch on. Cash may soon be an endangered monetary species. As we speak, the cryptocurrency exchange industry is working diligently to create a simple, secure link between conventional and digital currencies. The number of crypto account holders has increased steadily since the technology’s inception. The stores where you shop for everyday items, be they brick-and-mortar or virtual, may be looking for a piece of that growing business. Go where the customers go is a basic tenet of marketing.
How to Protect Yourself and Still Pay Your Bills
Is all of this making you a little queasy? Starting to develop your own case of germaphobia? Good. That’s your survival instinct kicking in. And there are lots of simple practical steps you can take to minimize your risk right now. Need we mention, cash is off-limits for the foreseeable future? Use your debit card (or even better, your smartphone) to pay for any purchase you make in the “real world,” whether that’s picking an energy drink at 7-11 or paying the guy who delivers take-out to your door. Invest in a box of disposable gloves—pick a color that matches your mask—and wear them when using a PIN pad of any kind. Make a list of everything you need before you leave the house so you can make fewer trips to begin with. Then try to check off all the items you wrote down while visiting the fewest number of stores.
Of course, from mortgage payments to utility bills, most of us pay a lot of bills already without leaving the house. You probably use your checking account for that purpose. With every other aspect of our lives upended, and while you have a little extra time on your hands, now might be the right time to take a look at how your checking account is supporting your new lifestyle.
Do You Really Need a Local Branch?
Once upon a time, it made perfect sense to do business with the bank around the corner from your home or office. That made deposits and withdrawals easy. But today, the best checking account is more likely to be the one that makes staying away from banks simplest. In the midst of the coronavirus pandemic, the financial institution that offers you the widest variety of electronic banking options and makes those options easy and inexpensive to use is probably the smartest choice. And that bank may not have even one office you can visit.
Look for a bank that offers online bill pay from both your PC and your smartphone—and download the app. Even before anyone had ever heard of the COVID-19, online bill pay was the safest way to. No missing checks in your register or mathematical miscalculations. Precise records of when you made payments and how much you paid, sortable by payee. Instant access to real-time balances. There are all kinds of benefits to using online bill pay. Online payments rarely get “lost in the mail,” for example. And online bill payments typically arrive at their destination more quickly. Right now, if you’re struggling to manage your cash flow, you may be paying some of your bills at the last minute. With online bill pay, that last minute can often come a day or two later. Those couple of days might be the only thing standing between you and some hefty late payment charges.
Free Checking: A Pervasive Myth
Lots of banks advertise free checking. But not as many actually deliver it. That’s because free checking offers often come with strings attached. You may have to maintain a minimum balance to avoid fees. That might be harder to do right now if your hours have been cut back or you’ve lost your job. Other banks ding you when you use an ATM that’s out of network. Then there are overdraft fees. Bounced checks happen to the best of us and some banks charge a pretty penny when you make that mistake. If you think so-called overdraft protection is the answer, think again. You may not get charged a fee by the dry cleaner you paid from an overdrawn account. But your bank will charge you. In fact, overdraft protection amounts to a license to unwittingly overdraw your account several times in rapid succession and, in the process, rack up a huge overdraft bill payable to your bank.
There’s A Plus Side, Too
While it’s important to be aware of the ways banks make money by doing business with you, they also compete for business in ways that can save you money. Some will give you a bonus for opening a checking account if you make a minimum first deposit. Others reward you for signing up for direct deposit through your employer. And while the interest rates checking accounts pay may seem minuscule, some banks pay more than others. Credit unions pay some of the highest checking interest rates available and charge some of the lowest fees. If you don’t belong to one, now might be a great time to join. And not just for the extra half-point in interest. Credit unions offer a variety of low-cost banking products, from credit cards to auto loans. With mortgage interest rates sinking to historic lows, the condo you’ve always wanted to buy could be within reach right now. Or perhaps you’d like to trim your monthly budget by consolidating your credit card debt through a low-rate personal loan. The news may be full of gloomy financial reports, but there are opportunities out there. You may want to take advantage of one or two. But do it digitally, for safety’s sake.