Personal Finance Advice

You stop by the bank to cash a check and the teller chats pleasantly with you and then studies the computer monitor with a concerned look on her face.  She leans in to speak to you in what seems like very urgent tones.

“I see you have quite a bit of money in your savings account.  Do you know you could make a lot more in interest if you put that money into a CD?”

You then think to yourself how lucky you are to have gotten in this teller’s line, because obviously she’s looking out for your best interest.

Maybe she is, but chances are that she is doing what she has been trained to do by her bosses at the bank: Cross-selling.  She is trying to get you to buy another product at the bank.  The various offerings of financial institutions are considered products, just like products you might buy in a grocery store or at the mall.  Just like a clerk at a clothing store might steer you toward the accessories before you head to the counter to pay for your purchases, a bank representative will try to find ways to get you to sign up for more financial products.

Some customer service representatives are actually given a quota that they are expected to fill within a certain amount of time.  For example, a teller might be expected to open twenty checking accounts, ten savings accounts, and get fifteen credit card applications in a month.  Since tellers don’t usually have an opportunity to go out into the community and drum up business they have to rely on the people walking through the doors of the bank to meet their quotas.

The next time someone at the bank urges you to apply for a loan or open a new account, don’t let the first thought in your mind be, “Wow, he must really know what he’s talking about.”  Yes, people who work at the bank often know the products inside and out, but that does not mean that they are always looking out for your best interest.

Open an account or apply for a loan because it makes sense to you, not because someone tries to talk you into it.  Don’t be surprised if a simple transaction turns into a sales pitch that leaves you feeling a little bit like you have been worked over.  Sometimes it’s tough to say no to someone who seems so concerned about your financial well-being, but you shouldn’t allow yourself to get swayed by a representative who is trying to meet a quota for the month.