This is a long read, but worth it. Some takeaways:
-Don’t use “buy now pay later.” The fine print isn’t what it seems.
-The fine print on medical financing, store credit cards, and contactless payment is also not what it seems.
-Payday loans are still predatory, even when offered by your employer
-Rewards programs are an income stream for the companies that run them. The points systems are manipulated so that the house always wins. They depend on people leaving money in rewards accounts and not in interest-bearing traditional bank accounts.
-Electronic payment apps like VenMo are not banks. You don’t earn interest. Your money is not protected.
-Your financial information is not private if your money is not kept in a regulated bank.
-None of this is regulated by the FDIC. Your money is not protected if it is held by a non-bank doing banking business. Our economy is not protected from the collapse of financial institutions that are not banks.
-The Biden administration was making progress in increasing accountability for non-banks operating as predatory financial services providers. The current administration is reversing those protections to favor corporations.
Oh boy.
A third of younger Americans hold their savings on nonbank tech platforms like Venmo
PEOPLE! DO NOT LEAVE YOUR MONEY IN VENMO OR APPLE PAY OR ANY OF THIS SHIT. FOR THE LOVE OF GOD GO FIND A REAL BANK OR A CREDIT UNION.
If Venmo were to close tomorrow all your money would vanish. There's no insurance or guarantee on any of these things. I know banks aren't great but legit banks will have the "FDIC insured" logo on their doors and websites, which means if my bank goes under tomorrow I still get my money back. Also I guarantee you there is a credit union somewhere in your town, go find it.
You can leave some money in Venmo or Apple pay or whatever, but NOT ALL OF IT for the love of God.
If you don't want to deal with the large banking industry i get it. Go sign up for a local credit union. They're FDIC insured, your money stays local, and you can personally get to know and talk to your bank.
Probably the best piece of advice I ever got from my lawyer was opening a credit union account. They really are noticably better behaved than banks.
Your money IS NOT insured under the FDIC in a credit union account (they’re bank-only); it is insured under the NCUA instead. Insured institutions will typically put the logo or a statement about said insurance on the bottom of their webpages and mailers or letters. (Investment accounts in brokerages would be insured via the Securities Investor Protection Corporation, SIPC, but only against the brokerage going out of business or similar, not against market losses when the prices of things an investor owns go down.)
This matters a lot in this administration because there are so many attacks on regulation, especially the Consumer Financial Protection Bureau (CPFB) and attempts to do bullshit like force banks to bail out crypto speculators before US dollar holders, so I would not be surprised if they tried something there too.
We go over this exact topic (the FDIC, NCUA, and even threats to the CFPB) in this video essay:
FDIC Insured Banking Doesn’t Mean What You Think It Means: The Truth About Securing Your Savings
