There is no question that banking plays an essential role in our financial well-being. So, how can you make the most of it? Just ask Alex, our expert banker, to get the advice you need for your banking success. Explore the advantages to online bill pay? Discover how the prime rate can affect your personal and business loans. Learn where to get the best exchange rate for foreign currency.
Question: My daughter told me I should use bill pay. What is it? – Helen from Lake Tahoe, California.
Answer: Bill pay is an online electronic payment service offered by most banks and credit unions. Working in conjunction with online banking, bill pay allows the customer to make either a one time or recurring payments to any business or person in the United States. The source of the funds usually come from a checking account, but online bill pay is generally free. The customers enter a person or company they want to pay, and the service sends the funds either electronically or prints out a paper check and mails it to the payee.
Question: The prime rate recently went up. How does it affect me? – Tyler from Bismarck, North Dakota.
Answer: The prime rate is the lowest rate of interest at which money may be borrowed commercially. It is the rate banks charge each other for overnight loans in order to meet their Federal Reserve requirements. The prime rate is important for individual borrowers because it affects the lending rates available for mortgages, small business loans and personal loans. Lines of credits like credit cards and home equity line of credits, that have variable interest rates, are greatly influenced by changes in the prime rate. When the prime rate goes up, the interest rates of those products also goes up, making it more costly to borrow money.
Question: Where is the best place to buy foreign currency? – Shane from Colorado Springs, Colorado.
Answer: If you are looking for the best exchange rate and lowest fees, the best place to buy foreign currency are banks and credit unions. Many banks and large financial institutions like Bank of America, Wells Fargo, Citibank and Chase offer currency exchange services to their customers. Be aware that most bank branches do not have foreign currency in stock, and they will have to be specially ordered. When ordering foreign currency at your bank, make sure they sell that particular currency. If they do, find out how long it takes to receive it and what the process is. If strapped for time, you can always buy foreign currency at the airport kiosks but use that as a last resort. The exchange rates are generally poor and the fees are high.
Important: For your specific questions about banking, contact your banking expert, Alex, at: alexexpertbanker@gmail.com
Alex is starting his 15th year in the banking industry. He has worked for such notable banks as Bank of America, US Bank, and Chase. Alex has his bachelor’s degree in Business Economic from the University of California Riverside.
