Survival Banking

Most of us have probably by now heard at least something of the troubles that the victims of these latest storms have had in trying to cash checks or do banking when their banks were destroyed or at least with out power for extended period of time.

I think that something I have done for years might help during a crisis like this. I kept my account that I used as a student when I first went to college.

It’s in a teacher’s credit union that allowed student workers to have accounts along with the teachers and other university employees. It is many hours from anywhere I have lived since I left there and would not likely be struck by the same catastrophe that hit where I choose to live.

I have always on moving had new checks printed with my current address and have never had any trouble using them anywhere I went. I normally keep my emergency fund in this account anyway as well as the occasional car loan etc. and so would have something to fall back on that is physically so far removed from me that it is likely to still be there if my area gets hit. Also thanks to the speed of Internet banking I could with a few minutes to spare send anything and everything from my local bank to my credit union before the clouds of doom descended on my fair city.

Just a thought for you to bounce around and see what you think!

What happens when the city your bank is in is destroyed?

Kinda like moving because most accidents happen within 10 miles of your house.

I would imagine banking with a bigger bank, such as Bank of America, with locations in multiple states would be best since they are likely to have better, multistate backup systems etc.

Accounts in national and local banks are both good ideas -- with ID you can access your acount from a diffrent city.

ONE plan:

Cash on hand
debit card/ checks
credit card with good limit
money in national account

This is not a commercial plug, but merely reality: you cash a check most anywhere at a hotel with an American Express card, not to mention an AmEx office.

Also, in these times of misplaced persons, if you have a family member that checks into a hotel with their card, AmEx has the capacity to deliver a message to them to contact you.

Living in the FL Keys, I thought about the senerio of a Cat 5 hurricane moving right up this string of islands. All of our accounts are with community banks. I asked a teller about account access if I evac. The best she could come up with is to use our ATM card.
I keep $5000.00 in cash for just such emergencies and have had to send my wife and daughters out of here twice this season. Sure is easier to convince them to go if I hand them an envelope with a couple grand in it.
This week I will be moving our savings account to a Bank of America account.

I did something very similiar. I joined a credit union in the midwest years before moving to Florida. I kept the account. Finally established a new account with another credit union, local this time. I keep most of my cash savings with ING Direct. Using the ING account, I can tranfer money between it and either credit union account. If one doesn't work, I'm hoping the other one will.

Must be nice to have that much cash on hand -- I can't imagine having 5 grand. At best, I can manage a couple hundred for emergencies and that's it.

It's nice but probably not necessary for most situations. I think the point is that, in most disaster scenarios, stores probably won't be able to take credit cards, and if you've traveled out of your local area, checks may not be accepted either. Seems like more and more people have less and less cash on hand. These same people will be in for a nasty surprise when the power goes out. <img src="/images/graemlins/frown.gif" alt="" />

In my experience, if you have more than $20, you're better prepared than the person who uses a debit card to pay for a $5 drive through order.

No phone lines = no credit card transactions, no debit card transactions. Some store cash register systems are on computers, so no power no credit/debit purchases.

I have paid in cash for purchases tallied by the cashier with a calculator ( taxes etc…) when the power was out. Many stores will not handle credit card transactions manually (remember the kchick-kchick machines ?) because of widespread fraud.

Cash is best – is my policy. Besides you can’t bribe anyone with a credit/debit card :-))

Maybe I did not flesh this out enough to let every one know what I was talking about. The people of south Louisiana have traveled north to escape the storm to places that have all the amenities we are use to in modern America but with their bank destroyed they still can’t do any banking because all their records and banks computers are gone. Its not a matter of not being able to bank because of a power outage its that the bank and all its branches are gone. Yea cash is king and always will be but there are bills to be paid checks to be written life must go on and that is greatly simplified by having more than one account that is physically separated from each other by a substantial distance.
To show you another example of computers being lost during the storm it is my understanding that there are new cars being driven all around the country right now with New Orleans dealers tags on them that still come up clean when you run the VIN on them because there is no one to report them and no computer to log them its all just gone. If Uncle Sugar can’t keep track of stolen cars right now we can hardly expect anyone to worry about your lost bank records or your needing to cash a check or do some banking.

Threads drift.

But now that I think about it, I'm not really sure how much redundancy I really have. I have no idea where the actual computers are that store my account information. Since they're both credit unions, even though they have no relation to each other, maybe my stuff's on the same server somewhere.

Even national "chain" banks... how much redundancy do they have? It's nice they have a disaster recovery plan. But if they're down any time at all, that'll be the exact moment I'm trying to get cash. <img src="/images/graemlins/smile.gif" alt="" />

I think we're mostly following up with, "It's good to be decentralized, but cash is still king."

National Banks would be recommended for accessibility issues.

I would think, with all of the deserved (and some over-reacting and power grabbing) need for protection from terrorism, and the existing FDIC program, there are extensive requirements on data security and integrity in the banking system. I highly doubt that you're account would just "disappear". Yes, it could be possible that a number of hours of banking history could disappear (it would probably be recovered anyway), but if you're like most people, you're withdrawls exceed your deposits. The bank is more likely to lose money, rather than you losing moeny. Payroll checks cannot be held, so they post immediately. If you deposit other checks, you'll want to make sure they post a few days in advance of any forseen catastrophe. Once it is on your account, you can be pretty sure that the transaction is recorded, and permanent.

If you're not convinced of this, and you still think that money could be lost, here are some suggestions:

1) Open another bank acount at a larger bank. By doing this, I can transfer any "excess" from my normal account to this bank. Yes, there may be a charge, but in the FedWire system(if used, not sure), there will be a transaction with the source and destination account numbers. This transaction will be backed up with 3 different entities (source, FedWire, destination). You also ensure that you have more banks to go and get your money from, without incurring too many charges (well, unless you're like First Union and charge $7 to talk to a teller, if they still do that...). Also, you can get wire transfers from your account, from other banks. Make sure your I.D. matches your mailing address!

2) Make sure you have online access to all of your banking accounts. This allows you to transfer money online for anywhere. Yes, your local bank wouldn't be open after a major event, but if it's predictable, or you have a regular plan, you would have done a wire transfer before hand. Internet access is available at nearly all libraries now.

3) Maybe travelers checks. They're pretty much guaranteed. However, if you're a merchant, I'm not sure how you know if they're not "stolen". i.e. user claims they're stolen, when in fact they used them. A bad thing in a disaster area, as there may not be enough resources to follow up. They also provide a CC/Debit/ATM style card that is it's own unique account number. This could be a useful way for you to have money if you're relocated like people were in New Orleans. (i.e. it's a "national" bank)

4) Horde cash in small bills. Cash is the only universally accepted form of payment in a disaster area. Save $200 in cash. More emphasis on smaller bills, than bigger ones. It's easier to give someone $4 for something that cost $3.75 and lose the $0.25, if necessary. You'll have to figure out how to keep yourself safe with all that money though.


There is no way I can think of, except by hoarding cash, to ensure a supply of money for more than 7 days in a disaster area. Most of your essential needs will be provided by relief agencies, until services are restored. Plus, if they a big problem bringing in essential supplies to some areas, is money really going to be a big deal? If you've done all the above $200 can probably get you pretty far with an average decent person. You know, the one that will actually take you to your destination, and not just drop your butt off the side of the road and leaves with your $200. That's a topic for another thread...

That 5 grand has taken me 3 years to squirrel away, the hard way. From collecting soda cans, umpiring adult softball, cashing in hoarded change and stashing any cash I could. It is a HUGE stress reducer knowing it sits waiting for TSHTF. The tough part is keeping my 16 year old daughter from weaseling some extra $ from me. " But Daddy, please!"

Actually, wouldn't the credit card company backing your debit card (if you have one) have this stuff squirreled away, at least account numbers and the like, just so they can tap your account?

If you work for a multinational/multistate corporation, and do direct deposit, the home office HR weenies will have it.

The IRS has it. So does the FDIC. I've been wondering why the FDIC seems to be having a hard time picking up the ball on this, but maybe they are just as preparred as all the other federal emergency relief offices.

That being said, I keep a little cash and two checks in my wallet, in the back, and never touch it. Ever. One check can determine an account number and the bank that issued it, just off the tracking numbers along the bottom. Two of those and photo ID, and no hesitation when you babble your SSN would suggest to me you are who you say.

For those who have no ID, they are tanked unless they can find someone, somewhere, who will float them a personal loan and vouch to them. Which means going to a relative who likes you (uh-oh) and isn't effected. Which means leaving the area.

You can always keep a deposit slip instead. Just in case it gets stolen, no one can get money from your account.

I am new to the forum but would like to say although I do not agree with some postings, I have picked up some excellent ideas off of here. I did the same with a military credit union when I went in long ago and still have the account. It is excellent for moving my funds. Any time I relocate I can transfer the funds from my local account to the CU in minutes and when I get to where I am going open a checking account there by writing a check or transfer and have a functioning local account in minutes. Also, I had an account with BofA International which is a seperate branch. I could go to any BofA branch or associate bank in about any city of the world and write a check for cash. Also, transfers were simple. I had everything but what I had on me stolen in upland Thailand. I had enough to get to Bangkok to get a money transfer and replacement passport. My trip was delayed about one day. Others in the party spent up to a week getting funds transfered from regular banking. Other banks offer the same services if you have need of it--works great for a vacation out of the country as well as an emergency.

Just found out it doesn't take a natural disaster...

Pulled up to the ATM, tried to get some cash. Machine ate my card! "Card has expired. Card will be retained. Thank you." WTF? It's already after hours, so I can't call until the next morning. Yes, the card had expired, and the replacement had (according to their records) been mailed over a month ago. I never received it. Or the PIN. We're sorry... we'll get a new one out to you "right away".

Since last year's hurricanes, I've kept a bit of cash at home for emergencies, so this was no big deal. And, like gas, I try to go by an ATM before I run out. And I have credit cards. And it was still a little spooky.

Just a thought about the cash on hand: should you record the serial numbers and denominations in case the money is lost in a fire or something. It would be helpful when getting the money replaced. or maybe home owners insurance would help.

I hadn't thought of that. I wonder what the procedure is for replacing currency?

I'd get a fire safe, but a recent thread on here makes me wonder if one I'd be likely to buy (because of cost) would do me much good.

To replace money I do believe you need both serial numbers showing on whats left of the currency.

A big fireproof safe is a great way to keep your paperwork safe. And it keeps it all in one place.

TRO

I have 2. One for a quick "getaway" for essentials(i.e. birth certificate, passport, cash), and another larger "waterproof" (for an hour) one for less important things. It mainly holds statements and such.

There are new laws to require large banks to have redundancy in place. IIRC min. 3000 miles between data centers. Also there is a law that no one bank can have more than 10% of the total deposits for the US, I believe it was BoA or City who just hit that limit with their most recent buyout oif a smaller bank.
A lot of the larger banks now resell their services to smaller regional banks so your little hometown mom and pop bank may even have some of their services outsourced to a large bank and therefore your funds may still be available even if the local bank is completely destroyed.

There used to be some sort of implied trust between banks where you could go to any atm machine and withdraw some cash even if the communications were down between the banks. Then if/when the communication was restored and you didn't have the funds you got an overdraft fee from your bank. I don't know if this has changed or not with all the new laws.
Best thing to do is keep some cash on hand for emergencies and then use direct deposit and online banking for the rest. Then if you do have to evac you have some spending cash for whatever needs you have and your company can still get a paycheck to your account which you could still access online somewhere and pay a few bills.

I am sure that in 4-5 months they will have it all straightened out as to who has money and where it is at etc. But for the people that needed their money to bug out or to live on while gone they were out of luck. Those people that did get away from the storm wrath had to have a way to purchase needed items immediately not in a month or two when the banks figured everything out. This is my reason for suggesting two banks fiscally and physically separated by many miles.

With all the people leaving NO and Galveston/Houston, did anyone hear of any "runs" on the banks in those places? Or are all the banks now part of other banks, so they just absorb the local losses as temporary?

Sue

I'm actually a little surprised that noone mentioned offshore accounts (as in the much-ballyhooed "Swiss Bank Account"). AFAIR, you can have well-protected accounts in Switzerland, the Bahamas, the Cayman Islands, and probably elsewhere.

Also, definitely keep some cash around, but don't go too crazy, as in a real disaster, cash is useless. Maybe twenty of every bill from $100 on down and a single standard roll of each common coin for each person in your group/family. Plus, twenty each of some small gold and silver coins. That's only 3-4K per person--small enough to carry, legal to transport out of the country, and enough to get you by for a bit.

An AMEX account is a good thing to have, but I've run into troubles in areas with bad network connections (Italy, for instance--VISA/MC worked much better for me there, despite multiple visits to the AMEX office in Roma). AMEX is great because it's nearly universally accepted throughout the industrialized world.

USD can always be exchanged for local currency, but it's probably not a bad idea to keep some Loonies and/or Mexi-pesos around if you live anywhere near the borders, or Euros/Sterling if you travel there frequently.