Thoughts and frustrations on managing personal finances
Posted By RichC on August 5, 2010
Once upon a time I thought I had our family’s banking and credit card use figured out … but between the bureaucrats sticking their noses 
into banking and the greedy bankers themselves wanting to make money hand over fist off the backs of the financially irresponsible like they did a few years ago, a wrench has been tossed into the works for the rest of us. Besides the latest round of hope and change, a WSJ article detailed the cat and mouse game being played my politicians and in turn banks, more responsible credit and debit card holders are facing “fee creep” as creative bankers look for ways to make up for lost revenue.
Besides the “fee creep,” the “change” came home to roost as a minor hassle for my college age son — in his is the case a change in banking laws in replacing an existing debit card tied to his Paypal account (story and rant below).
I’ve put an effort into try to teach my kids about managing money and helped them to establish a couple of different banking accounts prior to age 18 – checking, Internet based higher interest saving, a brokerage and yes, a Paypal account. For my daughter (good ol’ days) it was simple to get a ‘free checking with interest account’ issued in only her name and social security number in order to deposit her paycheck (she taught figure skating while in high school). For my son a couple years later, this process became more challenging and required a parent co-sign on such an account; no big deal as the tightened rules were understandable when considering ‘bad checks’ written by minors. At the time we also set up Paypal accounts in there names for a few online transactions (buying/selling on Ebay), but primarily as a way to get them their own ‘plastic’ Mastercard issued debit card – it was easy and with a few mouse clicks it was on its way. One of the features that makes the Paypal Mastercard better at the time was that the card that functioned as a credit card (no pin) and offeres a 1% rebate (some banks now do this). It was a good way for them (and parents) to keep an eye on their non-cash spending while under our roof and also having emergency cash without touching their interest bearing checking or savings account – easier to budget and a way to teach the responsibility of handling ‘plastic.’ This has worked great and in my opinion is a good way for parents to teach their kids. Advice to teens: Learn to handle a checking account and manage plastic while still at home. It might even be better for teens to have a little ‘small money trouble’ before going out on their own and doing it in a bigger way?
Fast forward – my son misplaced/lost his wallet which set up the lesson of checking on his accounts and cancelation of his existing cards. In helping with this, I figured no big deal … I’ve called for replacement credit cards before and the bank happily sends them out pronto … heaven forbid a customer stop charging! Unfortunately with the new banking regulations (according to Paypal) they will not just replace a card reported lost anymore. Huh? A Paypal customer must go through the the upgraded process of authorizing new card, even if it is to replace the previous one. Although this is not an impossible task, it requires my son to supply them with a credit card issued to him … or a bank debit card, something he doesn’t currently have (he uses a bank ATM only card). So the process to “replace his Paypal card” is to request a bank debit card, wait, submit this to Paypal, wait and eventually have a Paypal Mastercard again. For someone who might want access to his Paypal balance, this is going to take a few days.
In retrospect this is probably a small deal … as most people can exist without their habitual use of plastic and might even be fiscally more responsible for it? Come to think about it, I don’t think I had a card until I was married … so maybe this was just a therapeutic rant? In any case, it might be best to have a back up plan before losing your wallet.
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