Citi - new fee unless you have $30k or make monthly deposits

[CletusCaddy]

For fees, see the OP and links.

You can maintain a zero balance so long as you make $250/month in Enhanced Direct Deposits, which appear to be any deposits through the ACH.

Leaving a large balance made more sense in the recent era of minimal interest rates. Making this change will likely cause at least some people to notice interest rates are higher and Citi balances at almost 0% are costly.

This just seems like a hassle to me. Personally, I’d just open an account some place where it’s always free. In my case, I use a credit union. But maybe Citibank is offering some other great thing that justifies the hoops you could jump through.

I am not aware of ANY bank checking account that would pay as much as my Vanguard money market fund.
Hence I will never leave much of a balance in a checking account.
Hence I will always use ACH to deposit cash to any checking account just in time before bills are due.
I have had automated withdrawals from Vanguard to Citi in place long before this change.
I have another "free" online bank account with decent (for checking) interest and still do not leave much of a balance there.
It still pays about 1/10th what Vanguard mmkt funds pay.
Any cash in that account is also deposited either with ACH or mobile paper check deposits.

This change by Citibank actually simplified the ability to get no fee checking.
Before you need ACH AND electronic bill payments, now only ACH, no bill pay required.
And in the past they have counted every and all sources of ACH, just not checks and internal transfers, same as going forward.

This is really a non-issue for most customers, except those who kept a large balance and never deposited from any other institution.
For those customers only, now they have to leave an even bigger balance. But that is not something I would recommend, unless it's at Citi brokerage holding ETFs for instance. Any deposit product they have is just terrible in terms of rates. Why keep a balance in their bank products ?

Credit union is the answer here.

My credit union pays 4% on checking with a $25k+ balance and $500/month in spend on their credit card (which earns 2% cashback on everything, no annual fee).

It keeps me from feeling guilty about leaving money in checking and saves me the headache of sweeping out excess money into brokerage.

What credit union and where ?
Not aware of any with 4% checking accts around where I live.

Even so, I can get a higher yield on many ETFs in any brokerage, and in savings bonds. 4% would be good for checking, but I wouldn’t want to keep $25k in any checking acct. Not just because I can do better than 4% but also for security. With check washing, debit card fraud, ach pulls, I would never keep much in a checking acct no matter what rate they pay me. And do not want complexity/obligation of required recurring spend on their cc. Instead of $25k there can keep $30k at citi brokerage and keep zero in checking, and I still have a 2% cc without obligation to use it. Citi also throws in free checks, free certified checks, free stop payment on checks. A truly free checking acct. The only interest for me would be potentially for better customer service. Citi does have mostly bad service, except the branch in-person service.

https://www.sfcu.org/?gad=1&gclid=CjwKC ... IAQAvD_BwE

Anybody can join by joining one of their non-profit organizations.

There is zero complexity with the credit card spend requirement. I put $500 worth of monthly utilities and subscriptions autopay on the credit card and then stick it in a drawer.

Does Citi offer unlimited ATM fee reimbursement like this credit union does?

[beyou]

This just seems like a hassle to me. Personally, I’d just open an account some place where it’s always free. In my case, I use a credit union. But maybe Citibank is offering some other great thing that justifies the hoops you could jump through.

I am not aware of ANY bank checking account that would pay as much as my Vanguard money market fund.
Hence I will never leave much of a balance in a checking account.
Hence I will always use ACH to deposit cash to any checking account just in time before bills are due.
I have had automated withdrawals from Vanguard to Citi in place long before this change.
I have another "free" online bank account with decent (for checking) interest and still do not leave much of a balance there.
It still pays about 1/10th what Vanguard mmkt funds pay.
Any cash in that account is also deposited either with ACH or mobile paper check deposits.

This change by Citibank actually simplified the ability to get no fee checking.
Before you need ACH AND electronic bill payments, now only ACH, no bill pay required.
And in the past they have counted every and all sources of ACH, just not checks and internal transfers, same as going forward.

This is really a non-issue for most customers, except those who kept a large balance and never deposited from any other institution.
For those customers only, now they have to leave an even bigger balance. But that is not something I would recommend, unless it's at Citi brokerage holding ETFs for instance. Any deposit product they have is just terrible in terms of rates. Why keep a balance in their bank products ?

Credit union is the answer here.

My credit union pays 4% on checking with a $25k+ balance and $500/month in spend on their credit card (which earns 2% cashback on everything, no annual fee).

It keeps me from feeling guilty about leaving money in checking and saves me the headache of sweeping out excess money into brokerage.

What credit union and where ?
Not aware of any with 4% checking accts around where I live.

Even so, I can get a higher yield on many ETFs in any brokerage, and in savings bonds. 4% would be good for checking, but I wouldn’t want to keep $25k in any checking acct. Not just because I can do better than 4% but also for security. With check washing, debit card fraud, ach pulls, I would never keep much in a checking acct no matter what rate they pay me. And do not want complexity/obligation of required recurring spend on their cc. Instead of $25k there can keep $30k at citi brokerage and keep zero in checking, and I still have a 2% cc without obligation to use it. Citi also throws in free checks, free certified checks, free stop payment on checks. A truly free checking acct. The only interest for me would be potentially for better customer service. Citi does have mostly bad service, except the branch in-person service.

https://www.sfcu.org/?gad=1&gclid=CjwKC ... IAQAvD_BwE

Anybody can join by joining one of their non-profit organizations.

There is zero complexity with the credit card spend requirement. I put $500 worth of monthly utilities and subscriptions autopay on the credit card and then stick it in a drawer.

Does Citi offer unlimited ATM fee reimbursement like this credit union does?

In NY where I live there are hundreds of branches for in person service and no fee atm at those branches.

And again, I wont lock up $25 k in any checking acct at any bank, broker nor CU. No matter how low fees or how high the interest rate.

[CletusCaddy]

I am not aware of ANY bank checking account that would pay as much as my Vanguard money market fund.
Hence I will never leave much of a balance in a checking account.
Hence I will always use ACH to deposit cash to any checking account just in time before bills are due.
I have had automated withdrawals from Vanguard to Citi in place long before this change.
I have another "free" online bank account with decent (for checking) interest and still do not leave much of a balance there.
It still pays about 1/10th what Vanguard mmkt funds pay.
Any cash in that account is also deposited either with ACH or mobile paper check deposits.

This change by Citibank actually simplified the ability to get no fee checking.
Before you need ACH AND electronic bill payments, now only ACH, no bill pay required.
And in the past they have counted every and all sources of ACH, just not checks and internal transfers, same as going forward.

This is really a non-issue for most customers, except those who kept a large balance and never deposited from any other institution.
For those customers only, now they have to leave an even bigger balance. But that is not something I would recommend, unless it's at Citi brokerage holding ETFs for instance. Any deposit product they have is just terrible in terms of rates. Why keep a balance in their bank products ?

Credit union is the answer here.

My credit union pays 4% on checking with a $25k+ balance and $500/month in spend on their credit card (which earns 2% cashback on everything, no annual fee).

It keeps me from feeling guilty about leaving money in checking and saves me the headache of sweeping out excess money into brokerage.

What credit union and where ?
Not aware of any with 4% checking accts around where I live.

Even so, I can get a higher yield on many ETFs in any brokerage, and in savings bonds. 4% would be good for checking, but I wouldn’t want to keep $25k in any checking acct. Not just because I can do better than 4% but also for security. With check washing, debit card fraud, ach pulls, I would never keep much in a checking acct no matter what rate they pay me. And do not want complexity/obligation of required recurring spend on their cc. Instead of $25k there can keep $30k at citi brokerage and keep zero in checking, and I still have a 2% cc without obligation to use it. Citi also throws in free checks, free certified checks, free stop payment on checks. A truly free checking acct. The only interest for me would be potentially for better customer service. Citi does have mostly bad service, except the branch in-person service.

https://www.sfcu.org/?gad=1&gclid=CjwKC ... IAQAvD_BwE

Anybody can join by joining one of their non-profit organizations.

There is zero complexity with the credit card spend requirement. I put $500 worth of monthly utilities and subscriptions autopay on the credit card and then stick it in a drawer.

Does Citi offer unlimited ATM fee reimbursement like this credit union does?

In NY where I live there are hundreds of branches for in person service and no fee atm at those branches.

And again, I wont lock up $25 k in any checking acct at any bank, broker nor CU. No matter how low fees or how high the interest rate.

For me $25k is about six weeks of expenses. So it's kind of the minimum balance I need to manage my cash flow.

[exodusing]

I called Citi to confirm that any ACH deposits of $250 or more per month would waive checking fees. The phone rep confirmed and expanded on what I asked, which was a sign she understood my question and the program. I then went online and converted to simplified banking. A few minutes later I got an email confirming the change.

I had previously set up Vanguard to automatically send money to Citi every month, so now I can reduce my Citi balance and put the money into something at Vanguard with a nicer yield.

[patrick]

It's strange that people get so worked up when the word "fee" is used. So the min balance required used to be 10k? Missing out on 5% interest means $500 lost a year, or say $360 after tax. That's double the $15 fee you are super upset about.

The missing interest is exactly why I avoid big bank deposit accounts, with exceptions for grabbing sign up bonuses (in which case I take the money out soon after qualifying) or for BoA Preferred Rewards (which waives the minimum deposit balance) to boost credit card rewards. Citi's old system had a basic account that only required $1500 minimum to avoid fees and thus didn't lose that much interest, though I still wouldn't use it.

[patrick]

I called Citi to confirm that any ACH deposits of $250 or more per month would waive checking fees. The phone rep confirmed and expanded on what I asked, which was a sign she understood my question and the program. I then went online and converted to simplified banking. A few minutes later I got an email confirming the change.

I had previously set up Vanguard to automatically send money to Citi every month, so now I can reduce my Citi balance and put the money into something at Vanguard with a nicer yield.

Even banks that say they require payroll/benefits deposits sometimes actually accept other deposits as well. Accepting any ACH deposits, and Zelle deposits too, makes this a very soft requirement indeed. I would guess the main people getting hit by this will be those who lose their jobs and either don't pay attention to the account, don't realize they can transfer from their other accounts, or don't have other accounts to transfer from.

But considering the abysmal interest rates, why bother with this account at all?

[sperry8]

I called Citi to confirm that any ACH deposits of $250 or more per month would waive checking fees. The phone rep confirmed and expanded on what I asked, which was a sign she understood my question and the program. I then went online and converted to simplified banking. A few minutes later I got an email confirming the change.

I had previously set up Vanguard to automatically send money to Citi every month, so now I can reduce my Citi balance and put the money into something at Vanguard with a nicer yield.

Good news. Please report back (if you remember) in future mos to ensure no fee is charged. But from what you've said so far, I'd expect there to be no fee.

[student]

I called Citi to confirm that any ACH deposits of $250 or more per month would waive checking fees. The phone rep confirmed and expanded on what I asked, which was a sign she understood my question and the program. I then went online and converted to simplified banking. A few minutes later I got an email confirming the change.

I had previously set up Vanguard to automatically send money to Citi every month, so now I can reduce my Citi balance and put the money into something at Vanguard with a nicer yield.

This is good. A monthly $250 ACH requirement seems reasonable and it is consistent with other with competitors like Chase and BoA.

[RickBoglehead]

Don’t most banks have direct deposit requirements for free checking?

No one should expect free bank accounts.

Why not? I get free banking from Ally.

[pizzy]

Don’t most banks have direct deposit requirements for free checking?

No one should expect free bank accounts.

Why not? I get free banking from Ally.

Yes, free bank accounts exist.

No, people shouldn't expect them at every bank.

[beyou]

I called Citi to confirm that any ACH deposits of $250 or more per month would waive checking fees. The phone rep confirmed and expanded on what I asked, which was a sign she understood my question and the program. I then went online and converted to simplified banking. A few minutes later I got an email confirming the change.

I had previously set up Vanguard to automatically send money to Citi every month, so now I can reduce my Citi balance and put the money into something at Vanguard with a nicer yield.

This is the way....

[beyou]

Don’t most banks have direct deposit requirements for free checking?

No one should expect free bank accounts.

Why not? I get free banking from Ally.

So when did you last walk into an Ally branch and get a medallion signature guarantee ?
When did you go there to get a paper certified check to bring to a car dealer and buy a new car same day ?
I have done those things at a Citi branch multiple times.

I too have an online bank account elsewhere, and while they do have better service, higher rates on checking, lower min balances,
they do not provide all the services that a good branch bank can provide. And for diversification I like to have 2 checking acts anyway,
so I keep one online and one at a physical branch. The stuff I do online is most of my banking and where I would want redundancy of service.
The stuff I do in person is admittedly less frequent, so one B&M bank is sufficient for my infrequent visits in person, but nice to have one.
Citi really costs me very little, I never keep more than 1-2K in checking for more than a few days. I fund and spend as needed.

My small online bank allows you to select a particular rep you want to speak with to chat, and some have been there for years and I got to know them a bit. My Citi branch has a branch manager there for years who knows me and makes sure I get what I need.

[RickBoglehead]

Don’t most banks have direct deposit requirements for free checking?

No one should expect free bank accounts.

Why not? I get free banking from Ally.

So when did you last walk into an Ally branch and get a medallion signature guarantee ?
When did you go there to get a paper certified check to bring to a car dealer and buy a new car same day ?
I have done those things at a Citi branch multiple times.

I too have an online bank account elsewhere, and while they do have better service, higher rates on checking, lower min balances,
they do not provide all the services that a good branch bank can provide. And for diversification I like to have 2 checking acts anyway,
so I keep one online and one at a physical branch. The stuff I do online is most of my banking and where I would want redundancy of service.
The stuff I do in person is admittedly less frequent, so one B&M bank is sufficient for my infrequent visits in person, but nice to have one.
Citi really costs me very little, I never keep more than 1-2K in checking for more than a few days. I fund and spend as needed.

My small online bank allows you to select a particular rep you want to speak with to chat, and some have been there for years and I got to know them a bit. My Citi branch has a branch manager there for years who knows me and makes sure I get what I need.

I have a regional bank where I get free checking, and free business checking (I have almost zero activity on that side). They do all that stuff.

But I bought a vehicle 4 states away in May, and they accepted a personal check, from Ally.

[beyou]

Also note if you keep the $30k (like in an etf you would hold anyway) they waive many common non recurring fees as well.

No incoming wire fees ($15 for basic customers))
No fee for new checks
No fee for stop payment
No fee for certified bank check

So i can still keep most of my assets at Vanguard, wire fee to Citi, use all their checking related services free, just by transferring over one ETF to park in their brokerage. I have no plans for Citi CD nor savings accts nor large balances in their checking.

[Duckie]

I just got a notice from Citi to the effect that they will charge $15/month for checking unless you have at least $30,000 in Citi accounts or make an Enhanced Direct Deposit of $250 every month.

I had read about this new fee and wasn't concerned because my monthly pension is an ACH deposit. Then I realized that some months the deposit happened on the 30th or 31st depending on whether the 1st fell during a weekend. So now I'm either going to have to keep track and manually push some cash from Vanguard some months or not keep track and automatically push cash every month. Bummer.

[Caduceus]

Please report back about the $250 ACH. I'm curious because from reading Citi's annual reports, it seems they are moving away from small consumer retail and toward institutional clients, wealth management, and larger retail accounts. This is a change they seem to have already executed in other countries. They've sold off their retail operations in some international markets, and also instituted the ridiculously high cut-offs for deposit accounts. It's their way of saying ... "we don't want the small fry"

It's an interesting strategy that turns conventional banking wisdom on its head. I own Citi stock as I think it's the most undervalued of the big banks, but if they don't start doing significant share buybacks soon, I will vote with my money.

[HereToLearn]

Please report back about the $250 ACH. I'm curious because from reading Citi's annual reports, it seems they are moving away from small consumer retail and toward institutional clients, wealth management, and larger retail accounts. This is a change they seem to have already executed in other countries. They've sold off their retail operations in some international markets, and also instituted the ridiculously high cut-offs for deposit accounts. It's their way of saying ... "we don't want the small fry"

It's an interesting strategy that turns conventional banking wisdom on its head. I own Citi stock as I think it's the most undervalued of the big banks, but if they don't start doing significant share buybacks soon, I will vote with my money.

Helpful insight. They will need to hire new people if they hope to appeal to HNW customers.

[pizzy]

Please report back about the $250 ACH. I'm curious because from reading Citi's annual reports, it seems they are moving away from small consumer retail and toward institutional clients, wealth management, and larger retail accounts. This is a change they seem to have already executed in other countries. They've sold off their retail operations in some international markets, and also instituted the ridiculously high cut-offs for deposit accounts. It's their way of saying ... "we don't want the small fry"

It's an interesting strategy that turns conventional banking wisdom on its head. I own Citi stock as I think it's the most undervalued of the big banks, but if they don't start doing significant share buybacks soon, I will vote with my money.

Helpful insight. They will need to hire new people if they hope to appeal to HNW customers.

“Project Bora Bora” has already begun.

https://www.afr.com/companies/financial ... 120-p5elbt

[UpperNwGuy]

No one should expect free bank accounts.

I expect free bank accounts. I currently have free checking accounts at one bank and three credit unions.

[HereToLearn]

Please report back about the $250 ACH. I'm curious because from reading Citi's annual reports, it seems they are moving away from small consumer retail and toward institutional clients, wealth management, and larger retail accounts. This is a change they seem to have already executed in other countries. They've sold off their retail operations in some international markets, and also instituted the ridiculously high cut-offs for deposit accounts. It's their way of saying ... "we don't want the small fry"

It's an interesting strategy that turns conventional banking wisdom on its head. I own Citi stock as I think it's the most undervalued of the big banks, but if they don't start doing significant share buybacks soon, I will vote with my money.

Helpful insight. They will need to hire new people if they hope to appeal to HNW customers.

“Project Bora Bora” has already begun.

https://www.afr.com/companies/financial ... 120-p5elbt

Thanks! Cannot access article but I had heard of Citi cutbacks. That still does not mean they will have staff with the needed skills.

[pizzy]

No one should expect free bank accounts.

I expect free bank accounts. I currently have free checking accounts at one bank and three credit unions.

By “expect” you mean you’d only open a bank account if it was free?

Not that you think every consumer bank offers free checking accounts?

[pizzy]

Please report back about the $250 ACH. I'm curious because from reading Citi's annual reports, it seems they are moving away from small consumer retail and toward institutional clients, wealth management, and larger retail accounts. This is a change they seem to have already executed in other countries. They've sold off their retail operations in some international markets, and also instituted the ridiculously high cut-offs for deposit accounts. It's their way of saying ... "we don't want the small fry"

It's an interesting strategy that turns conventional banking wisdom on its head. I own Citi stock as I think it's the most undervalued of the big banks, but if they don't start doing significant share buybacks soon, I will vote with my money.

Helpful insight. They will need to hire new people if they hope to appeal to HNW customers.

“Project Bora Bora” has already begun.

https://www.afr.com/companies/financial ... 120-p5elbt

Thanks! Cannot access article but I had heard of Citi cutbacks. That still does not mean they will have staff with the needed skills.

Gotta get rid of the old to make room for the new.

[HereToLearn]

Please report back about the $250 ACH. I'm curious because from reading Citi's annual reports, it seems they are moving away from small consumer retail and toward institutional clients, wealth management, and larger retail accounts. This is a change they seem to have already executed in other countries. They've sold off their retail operations in some international markets, and also instituted the ridiculously high cut-offs for deposit accounts. It's their way of saying ... "we don't want the small fry"

It's an interesting strategy that turns conventional banking wisdom on its head. I own Citi stock as I think it's the most undervalued of the big banks, but if they don't start doing significant share buybacks soon, I will vote with my money.

Helpful insight. They will need to hire new people if they hope to appeal to HNW customers.

“Project Bora Bora” has already begun.

https://www.afr.com/companies/financial ... 120-p5elbt

Thanks! Cannot access article but I had heard of Citi cutbacks. That still does not mean they will have staff with the needed skills.

Gotta get rid of the old to make room for the new.

True! I will watch from the sidelines, assuming that transfers in from Fidelity will allow me to retain my account, or I suppose I could transfer $30K into an investment account. I just don't really trust them after their whole Know Your Customer debacle maybe five years ago where they froze my account. Also had trouble with some paperwork after paying off the mortgage. Annoying administrative glitches that took far too long to remedy. However, inertia and my safe deposit box keep me there.

Also the various departments are disconnected: banking, mortgage, credit cards.

[beyou]

Helpful insight. They will need to hire new people if they hope to appeal to HNW customers.

“Project Bora Bora” has already begun.

https://www.afr.com/companies/financial ... 120-p5elbt

Thanks! Cannot access article but I had heard of Citi cutbacks. That still does not mean they will have staff with the needed skills.

Gotta get rid of the old to make room for the new.

True! I will watch from the sidelines, assuming that transfers in from Fidelity will allow me to retain my account, or I suppose I could transfer $30K into an investment account. I just don't really trust them after their whole Know Your Customer debacle maybe five years ago where they froze my account. Also had trouble with some paperwork after paying off the mortgage. Annoying administrative glitches that took far too long to remedy. However, inertia and my safe deposit box keep me there.

Also the various departments are disconnected: banking, mortgage, credit cards.

The very fact that the various departments are disconnected is why you can't extrapolate that using one service will have the same service issues and risks as using another service. Their brokerage is not going to have the same KYC, AML rules and procedures as the bank for your checking acct. I am worried about the continued pace of people reporting that their checking and savings accounts were frozen by big banks like Citi and Chase. But I have never heard of anyone having their brokerage account frozen by these firms. The brokerage at Citi is operated by Pershing, a major back office brokerage operations, serving many brokers. I can transfer $ to/from the brokerage account directly to/from other banks than Citi. It works truly standalone, though that was not my purpose in opening the brokerage acct. I did want to meet their "tier" to get free banking services (checks, bank checks, monthly fees etc), but if my checking acct was frozen, I could easily liquidate my brokerage account or ACAT the holdings to another broker without involving the bank part of Citi.