Strategies for Shielding Your Finances in an Unpredictable Financial Climate:
In these tricky financial times, many folks are anxious about the impact of the Trump administration's tariff policies on their wallets. Headlines warn of ways these tariffs could harm the economy by pushing up prices and slowing down growth, leaving investors fretting about their portfolios, be it day trading or long-term retirement savings.
But worry about personal finances doesn't just stem from economic anxieties. In our digital age, we're all vulnerable to things like identity theft and other financial crimes. So, in addition to concerns about the economy, we've got good reasons to be concerned about our money. And with the Consumer Financial Protection Bureau (CFPB) being scaled back, victims of financial crime may have a harder time getting help.
Nevertheless, regardless of how the economic and technological landscapes shift, there are actions you can take to safeguard your bank account. Here, we'll cover six essential ones.
1. Supercharge bank security
High-yield savings accounts can offer a rate higher than inflation, allowing your money to grow. But if cybercriminals drain your account, it can be challenging, if not impossible, to recover the money.
Here are some basic steps to keep your account secure:
- Set up bank alerts: Mobile alerts for low balances or suspicious activity could help you identify fraud as soon as possible.
- Avoid public Wi-Fi: Public Wi-Fi, like in a library or coffee shop, can leave your information vulnerable to interception. Stick to a secure cellular network or home Wi-Fi when logging onto your bank.
- Employ a password manager: Password managers generate and store complex, unique passwords for each of your accounts, making it harder for hackers to gain access to multiple accounts if one is compromised.
- Utilize multi-factor authentication: Multi-factor authentication may require you to retrieve a code texted to your phone in addition to entering your password. Requiring your phone for the login process can help prevent hackers from gaining access to your account.
Related: Top high-yield savings accounts**.
2. Familiarize yourself with overdraft rules
Nearly a third of American workers live paycheck to paycheck, and overdraft fees can contribute to the financial stress. In 2024, the average overdraft fee was $27.08, and overdraft fees were charged on 94 percent of surveyed accounts in our website's latest checking and ATM fee study.
Understanding your bank's overdraft policies can help ensure a positive account balance. Some ways to manage your overdraft include:
- Set up low-balance alerts: Notification of a low balance can be a useful reminder to curb your spending.
- Consider overdraft protection: Banks allow you to set up protection that initiates a transfer from a linked savings account or line of credit any time a transaction would overdraw your account.
- Follow a budget: By setting up a budget, you'll designate portions of your income to necessary and discretionary expenses, helping you avoid overspending and ending up with a negative balance.
Read more: Types of checking accounts**.
3. Remain alert to scams
Scammers can cost consumers more than $10 billion a year. They may pose as friends, relatives, banks, or government officials, requesting money or personal information. Once the victim realizes they've been scammed, it's often too late to recover the money.
To avoid falling victim to scams:
- Suspect pop-ups and suspicious emails: Hackers can install malware on your device or redirect you to fake websites designed to steal your information.
- Be wary of urgent payment requests: Scammers create a sense of urgency to pressure victims into acting without thinking. Legitimate government agencies like the IRS won't demand immediate payment via specific methods like gift cards or wire transfers.
- Verify bank communications: If you receive a call, text, or email that claims to be from your bank, hang up and call the official number on your card or statement to confirm that the communication is legitimate.
"A cardinal rule that could prevent so much identity theft and fraud is: Don't give out personal or financial info to anyone in response to an unexpected request," says the FTC's Wei. "When you get any type of call, email or text seemingly from your bank – if you didn't expect it, you need to approach it with suspicion."
If you've been a victim of identity theft, report it to the FTC and your local police.
4. Purge unnecessary subscriptions
Subscription services like Netflix and Disney+ charge monthly fees. Though many consumers use these services regularly, 86 percent are paying for at least one subscription that goes unused.
"Convenience can lead customers to be unaware of how much they're spending on these recurring services as they pile up," says Matt Knise, SVP, premium + spend experiences at Capital One. Regularly reviewing your credit card statement can help you identify unused subscriptions and save money. Various apps and services make this process more efficient:
- Capital One subscription manager: Capital One cardholders can access an in-app tool to automatically identify subscriptions and recurring charges, allowing you to review and make decisions about which to keep or cancel.
- Cleo: Cleo is an app that lets you manage all your financial accounts in one place and provides a spending breakdown, including information about your subscriptions.
- Subby: Subby, an Android app, lists your subscriptions, the related charges, and a monthly or yearly total of all your subscription charges. Users can add an unlimited number of subscriptions to the list.
Some apps also offer to cancel your subscriptions or negotiate lower prices. For example, Cleo's "Haggle It" tool can help you negotiate a better deal. "It's about helping you cut the dead weight and save smarter, without having to dig through your bank statements," says Sarah Davis, head of consumer insights at Cleo.
5. Evaluate your bank relationship
Consumers often keep the same bank account for nearly two decades. But holding onto an account for so long might mean missing out on better options elsewhere. Online-only banks often offer perks like high rates, no fees, and low (or no) minimum balance requirements:
- High rates: Many high-yield savings accounts have APYs above 4 percent, offering growth far greater than rock-bottom rates at large brick-and-mortar banks – and even seven times greater than the average savings account APY.
- No fees: Some online-only banks don't charge monthly maintenance fees, overdraft fees, or fees for out-of-network ATM use.
- Low (or no) minimum balance requirements: Online-only banks may request a low minimum balance or none at all, unlike other banks.
If you're not earning a high rate, it's worth looking for a better deal.
6. Know when to seek help
Though changes in consumer protection agency operations may affect services, there are still options for resolving issues with financial institutions. Consumers can submit complaints about financial products or services via:
- CFPB: Consumers can submit complaints about financial products or services on the agency's website. Most companies respond to complaints within 15 days, according to the site.
- FDIC: In addition to insuring deposit accounts, the FDIC enforces consumer protection laws concerning its member banks. Consumers can submit complaints on the FDIC's website, and the agency will work with the consumer and the bank to resolve the problem.
- FTC: If you've been cheated out of money or if a business isn't delivering on its promises, you can file a report with the FTC. The agency will help you create a recovery plan that includes next steps. It also shares reports with its law enforcement partners to combat unfair business practices.
- Federal Reserve: Consumers who've experienced a problem with a bank or other financial institution can submit a complaint to the Federal Reserve. The agency then routes the complaint to the appropriate federal regulator or Federal Reserve Bank, which will then investigate and notify you of the results.
- Office of the Comptroller of the Currency (OCC): If consumers have a problem with a national bank or federal savings association regulated by the OCC, they can file a complaint with the OCC. The agency will then contact the bank on your behalf if the issue falls under its jurisdiction.
- State Bank Supervisors: Each state has regulators of banks and financial institutions. You can file a complaint about a bank on the website of your state's regulator. The Conference of State Bank Supervisors offers a directory of regulators by state.
In tough economic times and changing technological landscapes, these simple steps can help you find the best bank accounts for your needs, bank securely, and cut back on unnecessary spending. With shifts in the financial services industry, it's essential to stay informed about where to seek assistance if you experience problems with your banking institution.
- High-yield savings accounts can help your money grow, but they must be safeguarded against cybercrime. Set up bank alerts, avoid public Wi-Fi, use a password manager, and employ multi-factor authentication to secure your account.
- Overdraft fees can contribute to financial stress, especially for those living paycheck to paycheck. Understand your bank's overdraft rules, set up low-balance alerts, consider overdraft protection, and follow a budget to maintain a positive account balance.
- Scammers pose as friends, banks, or government officials to steal personal information or money, costing consumers billions each year. Be wary of pop-ups, suspicious emails, urgent payment requests, and verify bank communications.
- Regularly review your credit card statement for unused subscriptions, and use apps like Capital One subscription manager, Cleo, or Subby to identify and manage them more efficiently.
- Evaluate your bank relationship and consider switching to online-only banks that offer perks like high rates, no fees, and low (or no) minimum balance requirements.
- If you experience problems with a financial institution, submit complaints to the CFPB, FDIC, FTC, Federal Reserve, OCC, or your state bank regulator for resolution. Stay informed about where to seek assistance as the financial services industry changes.
