Finance

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Wells Fargo Gift Cards: The Perfect Gift*?

Wells Fargo Gift Card Gift cards are all the rage, and Wells Fargo says they have sold a million of them in just over a year.

Unlike store specific cards, the Wells Fargo card is a prepaid Visa card good anywhere Visa is accepted.

They call it “the perfect gift,” and tout its benefits on their website.

*MOUSE PRINT: What they don’t highlight are the many possible fees and quirks of the card. Those details are buried in their FAQs and separate 4000-word terms and conditions statement.

Information about fees is scattered over both documents, and they include:

  • Purchase fee: $2.50
  • Online shipping/handling: $2.50
  • Reissue fee (for balances remaining after three years): $7.50
  • Manual check issuance fee (to get remaining balance on card): $15.00
  • Monthly maintenance fee after one year: $2.50
  • Lost card replacement: $7.50
  • Foreign currency conversion fee: 3%

Card nuances:

  • Split tenders: if the item you are purchasing costs more than the amount you have left on the card, you may or may not be able to use the gift card in addition to some other form of payment to cover the balance.
  • Using the card at gas stations can pose a problem:

If you use your Card to purchase gasoline, we recommend that you pay inside the station, not at the pump. If you were to pay at the pump, the electronic terminal at the pump may be programmed to confirm that you have sufficient available balance on your Card to pay for an average purchase of gas. Before you are permitted to pump gas, many pumps seek an authorization for $75 and this amount could increase from time to time (“Preauthorization Request”). If you have an insufficient available balance on your Card to cover the Preauthorization Request, your attempt to use your Card at the pump may be declined. If you have a sufficient available balance on your Card to cover the Preauthorization Request, you will be permitted to continue your transaction at the pump. However, if the dollar amount of your actual gasoline purchase is less than the amount of the Preauthorization Request that we approved, a “hold” on your available balance may automatically result equal to the difference between the two amounts. Once the merchant sends us the final amount of your actual gasoline purchase, we will remove the “hold” on your available balance for any additional amount exceeding this final amount. This may take 3 to 7 days and during this period you will not be able to use any balance subject to this “hold.” TO AVOID A DECLINE OF, OR A HOLD ON, YOUR AVAILABLE BALANCE ON YOUR CARD, WE RECOMMEND THAT YOU PREPAY FOR YOUR GASOLINE INSIDE THE STATION.

  • Restaurants and travel businesses (hotels, car rentals) may authorize more than the actual purchase price of services, causing your card to be rejected if insufficient funds are on the card.

Many of these fees and inconveniences are inherent problems of many brands of gift cards or prepaid debit cards. And we probably should be thankful that Wells Fargo does not charge some fees that others do, such as for calls to customer service. The bottomline is that you might never know of these fees and inconveniences if you didn’t take the time to read all the mouse print.

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Chase Credit Cards: How to Avoid 32.24% Interest*

Chase change in termsDo you ignore those fine print notices that credit card issuers send out from time to time?  They are often accompanied by a letter that says there will be a “change in terms,” but it leaves the details to the fine print enclosure.

“Change in terms” is bank speak for a price increase or change that is not in your financial best interest. If they were lowering your rates or easing any terms, they would boast about that in the letter.

Many [but not all] Chase credit cardholders just received an “IMPORTANT NOTICE OF CHANGE IN TERMS AND RIGHT TO OPT OUT” in the mail. For those who did not take the time to read it, here is the bad news and the good news:

*MOUSE PRINT: Your default interest rate is going up to 32.24%. But… you don’t have to pay it if you send them a letter by November 23 opting out of the change.

[The default interest rate refers to the penalty APR that will be used to calculate your finance charges if you pay late, are delinquent, or speak ill of the credit card company to your friends.] 

This notice is unlike similar notices in that your account will not be closed if you reject the changes. But like similar notices, they don’t tell you what the current terms are, so you can’t compare old with new.

It does appear, however, that in additional to raising the default interest rate, they are adding terms of when the default rate will be triggered. (For example, a default late in the month will be treated as if you defaulted on the first day of the billing period.)

Another change that is not obvious because the prior terms are not restated is the apparent lifting of the cap on balance transfer fees. In the past, on some Chase cards, the maximum fee  you could be charged was $75. Soon it will be unlimited.

Since most people have ignored this notice, they don’t realize the once in a blue moon opportunity they have been given to opt out of certain of the new provisions (APRs and default rules). Their silence will constitute acceptance of these terms, including the new 32.24% default interest rate. All that because they didn’t take the time to read the mouse print.

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West Gate Bank 6 Month CD: Earn 10.38%*

west gate bank 10.38 smallWow. Where most accounts today earn only a few percentage points of interest, this bank is offering a rate from yesteryear: 10.38%.

Are you going to make a killing with this interest rate?  Don’t bank on it.

For one, you have to visit a particular branch of West Gate Bank in Lincoln, Nebraska.

What else?

*MOUSE PRINT: “Minimum and maximum amount of $500 only.”

So how much money are we talking about really earning here? Six months’ worth of interest on $500 is approximately $25.95 (maybe a bit less). At their regular rate of interest (4%), you would earn about $10. So despite the attention grabbing headline of 10.38% interest, this offer is worth less than $16 in extra earnings.

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