Why Move Your Money to a Smaller, Local Bank?

Posted by politicalpartypooper on April 18, 2010

Recently I’ve been talking with my clients and friends about this movement we heard about which has many Americans moving their banking business to small, local banks from large, Corporate Banks.  I think the movement started as a sort of revenge movement against banks too big to fail.  But it has grown some legs, and I’d like to share with you one of the best reasons for considering moving your money.

Whenever I talk with our local banks or Credit Unions, one of the first things they bring up is how much money they pour into the local economy through personal and small business loans.  When I talk with huge Corporate banks, they don’t say anything about the local economy.  Usually, the talk revolves around their business banking fees.  No kidding.

So what?

Here’s the what.  When you bank locally, your money stays local, mostly.  When you bank with a giant too big to fail bank, the chances that your money is staying local are slim.  When you bank locally, your money is invested back into your community, back into small businesses that create good paying jobs and keep the local economy humming.  When you bank with a huge corporation, your money is invested in huge corporate investments, like international building projects, overseas oil ventures, and god-only-knows what else or where. When you bank locally, you help your local economy, and that helps you.  When you bank with a corporate giant, you bank nationally and internationally, and that usually helps everyone else but you and your local economy.

If you want your local economy to have the best opportunity available, keep your money at a small, local bank.      Ω


2 Responses to “Why Move Your Money to a Smaller, Local Bank?”

  1. It’s getting to the point that maybe your money is best in the form of ‘gold bars’ and kept under the bed!

  2. Edith said

    After a conversation on the misuse of algorithms and computer models, my friend who works for a regional bank in KC replied:
    My bank uses their own algorithms developed by the CEO. I used to think he was too stringent in his creditworthiness requirements but, we have no need of TARP funds. Because of the stringent rules, the balance sheet is in good shape.
    Sue’s response represents the business model that most community and more conservative banks follow in this country. Likewise, life insurance companies who minimize exposure in line with their resources. It is likely that 90% of banks represent this type of business model and now the big bloated greedy investment banks on Wall Street have tainted all banks with their greed. Now our sneaky treasury creeps are sticking it to the local and regional banks, demanding they foot the bill for bank default slush funds, even though the local banks had no part in the meltdown.

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