12 Influential Experts Give Their Top Money Tips for 2016

When it comes to personal finance advice, there’s no shortage of it. In fact, you could spend countless hours reading the tips and strategies of experts to learn how to better manage your money. It can be overwhelming. So, wouldn’t it be nice if you could simply get the best advice from the best experts?

GOBankingRates asked some of the most well-known personal finance experts and entrepreneurs to share their top money tip for 2016 as part of our annual “Best Money Expert” competition in collaboration with Ally Bank. Here are the top tips these 12 finance experts offered to help you take control of your finances next year.

1. Be proactive with your money. As a best-selling author and host of his own popular radio show — with more than 8 million listeners — Dave Ramsey is one of the most well-known names in personal finance. His get-out-of-debt message has helped many eliminate debt and achieve financial success.

For 2016, Ramsey said you should “tell your money what to do instead of wondering where it went. People know what they need to do with their money, but they just don’t do it. Be proactive with your money — do a budget, get rid of debt and save.”

2. Find a job you’re satisfied with. Clark Howard, host of the nationally syndicated radio show “The Clark Howard Show” and author of 10 books, has been helping people save more and spend less for decades. To get ahead in 2016, Howard suggested making sure you’re happy with your current job.

“My No. 1 tip for Americans as we approach 2016 is if you are in a job you aren’t completely satisfied with, shop the market,” said Howard. “If your employer is being cheap about giving raises, there are tons of companies out there that are offering great opportunities right now — so shop yourself in the market, and find a better job that’s better for you and your family.”

3. Make saving for retirement a priority. Nationally syndicated personal finance columnist Liz Weston said that people need to make saving for retirement a priority in 2016. “It’s going to come sooner and cost more than you think,” said Weston, who is the author of numerous books and has won several awards for her writing.

“The good news: The younger you start, the better shot you’ll have at financial independence,” she said. “Even if you got a late start, though, every dollar you save will help your future self have a better life.”

4. Create an ideal investment portfolio. Tony Robbins is known for his ability to distill practical and digestible lessons from complex financial concepts. The author, adviser and successful businessman said that investors need to adhere to four core principles as they head into 2016. These core principles include not losing money, finding investments with asymmetric risk and reward, creating a tax-efficient portfolio and diversifying your assets.

“Ultimately, you want to make sure that your portfolio aligns with these Core Four principles so that you’re protected no matter what,” said Robbins.

5. Always make a plan. Chris Hogan has made it his mission to help people successfully manage their finances in their personal lives and businesses. The former national champion and all-American football player now helps people plan for the future. He said the best thing you can do for your finances in 2016 is create a plan.

“Think about what your financial goals are and create a plan to reach those goals,” Hogan said. “The necessity of a plan sounds simple, but it is the one thing that many people overlook when it comes to their money. And a dream without a plan is simply a wish.”

6. Ask for better rates. Nicole Lapin claims to be the “only finance expert you don’t need a dictionary to understand.” So her best money tip for 2016 is simple: Learn to negotiate. “I’m a big advocate of negotiating,” said Lapin, author of “Rich Bitch.” “All it takes is a little guts.”

7. Get financially educated. Robert Kiyosaki is known for his unconventional perspectives on money that he advocated in his “No. 1 personal finance book of all time,” “Rich Dad Poor Dad.” So this personal finance expert who likes to challenge the status quo advised you take responsibility to get ahead next year.

“Don’t wait for the government, a financial adviser or your boss to take care of you,” Kiyosaki said. “You must take control of your finances. You must get financially educated. Take responsibility for your life and your future — don’t give that right away.”

8. Create the lifestyle you want. The winner of GOBankingRates’ 2014 “Best Personal Finance Expert” competition, Josh Felber has made it his mission to help people make more money and enjoy a lifestyle of their own design. To that end, he has two money tips for 2016.

“To create real wealth, you must quit spending your future wealth on goods and services that you want today, but deprive you of wealth long term,” said Felber, who was featured in Steve Forbes’ “SuccessOnomics.”

His second tip is that “2016 is the year to break free from mediocrity and society’s norms. Now is time to quit your 9-to-5 job and become an entrepreneur. Start becoming the true you and creating the lifestyle you are destined for.”

9. Think about how to bring in more money. Kyle Taylor helps the 5 million readers of his blog, ThePennyHoarder.com, put more money into their pockets. Although he’s a pro at cutting costs, his No. 1 money tip for 2016 is centered on earning more rather than saving more.

“From ‘skip the lattes’ to ‘cut the cord,’ there’s plenty of great advice on how to save money,” Taylor said. “But I believe there’s something missing from most of the discussion: You should spend just as much time thinking about how to bring in extra money as you do thinking of ways to save what you already have. There are only so many things you can cut from your budget.”

10. Automate your savings. Jeanette Pavini has had a long career as an author, investigative reporter and spokesperson with a mission to save people money. In her role as spokesperson for Coupons.com, she has shared her money-saving expertise on hundreds of national and local television programs and publications. So, it’s no surprise that her top money tip for 2016 is about saving.

“Automate your savings out of every paycheck, rather than putting lump sums in when you get around to it,” Pavini said. “You want your money to earn as soon as you earn it. If you already have automatic savings, up it by 1 percent. It’s small enough you won’t notice, but big enough to make a difference.”

11. Wealth includes more than money. Tim Ferriss is many things: angel investor, public speaker and author of several books — including the bestseller “The 4-Hour Workweek.” His business podcast, “The Tim Ferriss Show,” is routinely ranked as a top podcast on iTunes and offers listeners advice on how to improve their lives.

For 2016, Ferriss offered this money mantra: “The lifestyle value of each dollar you have is determined by your control of two other currencies: time and mobility.”

12. Never lose money. Warren Buffett is one of the richest men in the world. He is also a successful and brilliant investor.

Perhaps this mantra of his explains, in part, how he came to be one of the most successful investors of our time: “Rule No. 1: Never lose money. Rule No. 2: Never forget rule No. 1.”

Last Week’s Biggest Movers on Wall Street

Plenty of stocks go up and down in any given week. The gainers inspire us to keep investing. The decliners keep greed in check while reminding us about the risks of the equity markets.

Wall street, New York, USA.

Let’s go over some of last week’s best and worst performers.

Oil-Dri (ODC) — Up 26 percent last week

There’s apparently big money to be made in selling kitty litter. Oil-Dri shareholders purred in delight after the company posted a record quarterly profit of 71 cents a share. Things aren’t perfect. Sales fell slightly since a year earlier. One-time items helped deflate its effective tax rate. However, it’s still an impressive showing for Oil-Dri.

Pure Storage (PSTG) — Up 13 percent last week

Some IPOs don’t get hot right away. Pure Storage went public at $17 two weeks ago and investors didn’t want it. The stock closed at $16.01 on its first day of trading, moving even lower the next day.

It was a different story last week. Dell’s big deal to acquire EMC (EMC) lit a fire under other providers of data storage solutions. If the now privately held Dell is on a shopping spree, it may inspire its PC rivals to make big bets on other players in data storage.

BofI Holding (BOFI) — Down 29 percent last week

Online banking is a neat way to shave overhead costs, but last week it was an online banker that was shaved down. BofI — the parent company of Bank of Internet — took a hit after a pair of former auditors offered up problematic assessments.

An internal auditor kicked things off by filing a complaint, alleging that BofI was hiding information from regulators. Another auditor went on to claim that he left the dot-com banker after raising similar concerns.

Spirit Airlines (SAVE) — Down 17 percent last week

There was some choppy turbulence for Spirit investors after the bargain carrier reaffirmed its guidance, but cutthroat competition is keeping fares low through the year ahead. The ho-hum outlook led Morgan Stanley to downgrade the stock.

Spirit is a controversial name in the industry. It advertises low fares, but then slaps on a wide array of fees. Sometimes a carry-on bag will cost more than the passenger. The airline industry has been on an upswing in recent years as sector consolidation has lowered costs and increased pricing power, but that doesn’t mean that everybody’s a winner.

Conn’s (CONN) — Down 13 percent last week

Finally, we have a meandering consumer electronics retailer continuing to cope with deadbeat customers. In a regulatory filing, Conn’s conceded that 11.9 percent of its securitized portfolio has been delinquent for more than 60 days. That’s a concern, naturally, and Zacks downgraded the retailer’s stock to a “strong sell” rating following the fiscal update.

5 New Ways to Save Big Bucks in Managing Your Money

A stack of bundled of 100 US dollar bills

There are countless startups sitting on mountains of venture capital money and promising to change the world. Most journalists have focused on the world of payments, and that focus only increased with the launch of ApplePay. But ApplePay offers convenience, not value. While it is fun using an iPhone at a checkout (if you are lucky enough to find one that accepts ApplePay), it certainly won’t help you prepare for retirement.

Technology is finally being used to transform consumer financial services in a dramatic way. You no longer need to settle for 0.01 percent on your savings account. It has never been easier to shop for cheaper auto insurance. You don’t have to pay 25 percent interest on that store credit card. You don’t have to pay 1 percent (or more) to have customized financial planning. Even student loans can now be refinanced at dramatically lower rates, thanks to innovative startups, and not traditional banks.

Here are the five biggest innovations that can actually save you significant money and help you retire early.

  1. Branch-free banks deliver savings accounts with rates 100 times better than traditional banks. The largest banks are paying an average of 0.01 percent on basic savings accounts. If you have $25,000 in an account, you will earn a ridiculously low $2.50 interest over the next 12 months. You could easily earn $280 by switching to an Internet-only savings account paying 1.15 percent. And it is easy to find some of the best interest rates online, by using a comparison site like MagnifyMoney, which I operate.
  2. Shopping for the best auto insurance premium is easy and quick. The majority of Americans use an agent to make a decision. But agents are tied to just a handful of auto insurance companies and usually cannot give you a full comparison. A number of new websites offer you the ability to compare auto insurance easily and quickly online. One of the best is TheZebra, which has compared over 1,700 products from more than 200 insurance companies. In just a few minutes, and without giving any personal information, you can very quickly see how much you could save on a quote. Even if you don’t want to change providers, it is worth doing a quick test drive and seeing if you qualify.
  3. Personal loan companies give you alternatives to obscenely high interest rates on credit cards. Store credit cards regularly charge 25 percent, regardless of your credit quality. And credit cards typically charge 15 percent or more. Historically, the only real way to save money was to surf your debt from one balance transfer to another. However, over the last few years, some dynamic new personal loan companies have been created. LendingClub is the most famous, and borrowers refinancing credit card debt cut their interest rates an average of 31 percent. Even better, you can apply for most of these loans without hurting your credit score. If you are looking to refinance your credit card debt and cut up those cards, shop around for the best deal. Go to MagnifyMoney’s personal loan comparison page to find the best rate.
  4. Low, flat fees for financial planning boost your return. If you go to a traditional brokerage, you will quickly realize that they make money from commissions on trading. As a result, they have a tendency to encourage frequent trading and more expensive products. The data is clear: consistently beating the stock market with actively managed mutual funds is virtually impossible over time. However, stock brokers still make plenty of money trying and failing to do just that. Many financial planners charge a percentage of assets (typically 1 percent) and provide better advice. All of that is changing with companies like Betterment. They charge a low, flat fee to provide financial planning. If you have $100,000 invested, you could save $55,000 over 20 years, by paying only 0.15 percent of your assets as a fee.
  5. Companies can refinance student loan debt at lower rates. Interest rates on student loan debt can be extremely high, and America’s student loan debt exceeds credit card debt. It isn’t a surprise that innovative companies are looking to help qualified borrowers refinance student loan debt. The leader in this market is SoFi, whose variable rates start as low as 1.9 percent. The savings over a lifetime can be dramatic.

I lived in the Silicon Valley during the first dot-com boom. Sock puppets were trying to sell us pet food, and financial services were left largely untouched. All five of these new business models present existential threats to the profitability of big, entrenched banks and financial service companies. That is great news for consumers. Hopefully everyone will be moving their emergency fund to an online bank, refinancing their credit card and student loan debt to low interest rates, slashing their auto insurance premiums and virtually eliminating investment fees. Technology has the power to put more money in our pockets. It is now up to us to use that power.

Bank Online or the Old-Fashioned Way? Here’s How to Choose

It’s news we’ve heard before – online banking is the way of the future.They seem to have it all: relatively high interest rates, stellar customer service, low fees, and the added bonus of 24/7 access to your finances with the click of a button.

Still, online banking isn’t for everyone, and the line between the two is becoming blurred as more banks ramp up their web presence to compete.

To help you decide, we tapped Richard Barrington, a senior financial analyst at MoneyRates.com, to break down the pros and cons of keeping your cash in a traditional versus online bank.

Security: This is one issue that scares many people away from taking their banking online, but Barrington said it shouldn’t. Even traditional banks have all your financial information stored in a big data center that could be vulnerable to hackers. “Data theft is a very real risk these days, but, unfortunately, as a consumer, it doesn’t come down to whether you choose to bank online,” he said.

If you choose an online bank backed by the FDIC, you’ll be covered for losses up to $250,000 just like any other bank customer (use the FDIC’s Bank Find tool to be sure). And, of course, remember to avoid doing any online banking on a public or shared WiFi connection, since that’s when your information can be most easily intercepted.

Fees: Online banks are friendlier to smaller depositors because they typically require lower monthly balances. Barrington said traditional banks require an average of about $4,700 to be kept in your savings account without charging you a nominal monthly maintenance fee. For online banks, that number is much lower at $350. In addition, online banks are about twice as likely to offer free checking, he said.

“I think (online banking) is a really good option for younger customers – the fees as a whole are lower, the balance requirements are also lower, and young people as a rule are more comfortable with technology,” Barrington said.

ATMs: Banking is all about getting cash when you need it, and Barrington said people should look at the locations of a bank’s ATMs before they open an account. “You want to make sure you choose a bank where the geographic footprint of their ATM network is similar to your regular movements,” Barrington said.

Traditional banks, like Chase and Bank of America, have ATMs all over in many major cities. Online banks, like Simple, often have agreements with ATM networks like Allpoint for surcharge-free withdrawals. And most others offer to reimburse customers up to a certain sum for using out-of-network ATMs.

Deposits: Web-based banks offer a few different options to deposit physical checks. You can always mail them in, but most online banks also offer “eDeposits” in which you can take a picture of the front and back of each check and upload it to your account for deposit. A lot of people still would rather deposit a check with a teller than a text message, but the option’s out there. “People are for the most part checking their balances online, getting information online, but when it comes to depositing a check, they’d much rather hand it to a teller,” Barrington said.

Interest rates: Online banks typically have better interest rates than traditional banks because they don’t need to take any funds to operate brick-and-mortar buildings. In a recent MoneyRates.com study, online banks were found to have about six times higher interest rates than the nationwide average. Some of the best were found at Ally Bank, American Express Bank and Sallie Mae Bank.

Customer service: If you like to deal with the people managing your money via email or over the phone, go digital. If you’d rather have someone to talk things through with face-to-face, stick with a regular bank. Nearly all banks also have call centers and online message centers as well. Online banks are rarely, if ever, “closed.” But if you’d rather use a traditional bank to complete your transactions or get questions answered in person, you’ll need to visit your bank during normal business hours and make sure it’s not a bank holiday.

Personal preference: Having a personal relationship with a banker can be a big benefit for people, especially those who like getting new products or services pitched to them or getting in-person financial advice. But keep in mind that banks have been closing physical branches left and right to cut costs, even installing ATMs that allow tellers to answer questions via web cam. “As time goes on, the comfort level will grow more and more,” Barrington said. “If the technology can prove itself, people will use the technology.”

The bottom line: If you’re comfortable with technology and don’t feel like you need face time with the people handling your cash, keeping your savings in an online bank is a great option. You’ll see your money grow faster than with a big bank, and you’ll pay less in fees. As far as checking accounts go, online and traditional banks are pretty much neck in neck.

“I think the common denominator is that online banking is cheaper for banks to provide because they’re not supporting a physical branch and people to staff that branch,” Barrington said. “Even banks that offer both are likely to offer you higher rates and lower fees if choose online options.”

Facebook Wants to Be Your Online Bank

FORTUNE — Someday soon, Facebook users may pay their utility bills, balance their checkbooks, and transfer money at the same time they upload vacation photos to the site for friends to see.

Sure, the core mission of the social media network is to make the world more connected by helping people share their lives. But Facebook knows people want to keep some things — banking, for example — private. And it wants to support those services too.

“There are certain things, whether itʼs financial services, or banking where I donʼt necessarily want my friends to know exactly what Iʼm doing, right?” David Robinson, Facebook’s director of global marketing solutions, U.S. financial services, asked a crowded room of bankers at a Securities Industries and Financial Markets Association (SIFMA) seminar in New York late last month. “I want to be able to go in and have an experience with my advisor or my bank and have that be a one-on-one experience.”

Facebook is quietly planning just such an offering with Australia’s Commonwealth Bank. Currently in an internal beta, with the first version built in March, the application is expected to launch sometime this year to customers. It will allow Facebook users who are bank customers to make payments to third parties as well as Facebook friends through the social media channel, according to the bank. Commonwealth will secure transactions with its own authentication system — similar to how payments are secured on its online and mobile banking site, a spokesperson says.

Facebook declined to comment specifically on the banking push. But Robinson is clearly communicating to the banking community that Facebook (FB) hopes other financial institutions will follow. The hope is that by creating private experiences on social media’s normally very public channel, banks can better engage customers, not to mention drive more traffic to Facebook, and open the doors to other avenues where the company can monetize its platform.

Commonwealth won’t be the first institution to enable financial transactions on Facebook. Facebook’s former chief privacy officer Chris Kelly is an advisor to Loyal3, a startup that allows Facebook users to buy fractions of shares in companies they love, and to share that on Facebook. Loyal3 launched the program earlier this year with Fifth & Pacific Companies (FNP), the publicly-traded owner of Juicy Couture, Kate Spade and other fashion brands.

But while Loyal3 assumes consumers will want to share the fact that they’re fans of a brand, the banking community knows that most personal financial activities are inherently private. And here Facebook is encouraging financial institutions to enable activities, like banking, with full knowledge that they won’t be shared, but they will still be ways to potentially broaden Facebook’s network and keep people engaged on the site longer.

Currently, just 16% of a brand’s fan base actually engages with a company’s Facebook page, notes Robinson. So finding other ways for users to interact with brands on Facebook could help Fortune 500 firms that are looking to grow their social media presence, while of course helping Facebook grow as well.

There are risks such as spam messages that could look like a friend in trouble, prompting users to send money through their Facebook app. But Commonwealth Bank says it won’t launch the app unless it can offer customers a 100% guarantee of security, a spokesperson says. Plus scams like these are inherent to any virtual medium today, and unlikely to deter the Facebook user who finds banking from the social channel a time saver.

Banker, Broker, Adviser, Seller: The Best of the Financial Web

Online Banking

While we don’t know exactly how many Americans use online banking, it’s estimated that between 25% and close to 50% of the adult population take to the Web regularly to do our most important financial business.

We click and pay bills at home computers, log on to advisory services for input on investing or withdrawing retirement funds, use tablets to check brokerage balances on the go — the variety of services delivered via the Web is already vast, and it’s growing by the day.

A Real-Time View of Financial Innovation

The company Corporate Insight tracks what firms are cooking up for consumers and calls out the most meaningful enhancements via its annual Monitor awards. In 2011, the company tracked the best innovations in real-money accounts of more than 100 financial institutions. Among the overall findings:

  • Mutual fund firms released 25 new adviser-targeted tools and eight new tools for retail investors. Uses varied from calculating college savings needs to assisting with portfolio building and tracking fund performance.
  • Credit card issuers spent considerable time and capital on webpage redesigns. The most active highlighted enhancements in marketing pitches delivered via social media, with Facebook and Foursquare cited among the most-used channels.
  • Brokerage firms used 2011 to enhance their online trading capabilities, expand research offerings, and introduce mobile apps. Seven firms added new screeners and tools for equity investors.

For the Monitor awards, Corporate Insight’s team of analysts named the following firms standouts in six categories:

1. Advisers: Lord Abbett. While Putnam stood out for revamping its entire site, Lord Abbett and BlackRock also made substantial page and navigation changes, Corporate Insight said. At Lord Abbett, you’ll find useful links to top-rated audio and video at the main advisor page, as well as a collection of timely “perspectives” columns.

2. Annuities: The Hartford and Transamerica. Both firms focus on a clean look with quick links to available products. Transamerica, in particular, couples product listings with educational guides to help advisers and investors determine the best fit for their stage of life and financial goals. (Timing may be the biggest factor when it comes to annuities, however.)

3. Banks: Bank of America (BAC) and Chase. Corporate Insight singled out JPMorgan Chase (JPM) for revamping its private client site, which includes a new homepage for cardholders.

4. Credit Cards: Discover. Plastic pushers were among the most active innovators. Discover Financial (DFS) won acclaim for a new public layout and improved design and navigation, though Corporate Insight also singled out American Express’s (AXP) and Citigroup’s (C) card divisions for their respective efforts in the category. All three also earned kudos for their social media efforts, such as Amex’s check-in discounting partnership with Foursquare.

5. Online Brokerage: Fidelity, optionsXpress, and Charles Schwab. While these three took home the top honors for Web enhancements, several more added new research capabilities. Fidelity, meanwhile, gave customers the ability to comprehensively track account performance online.

6. Mutual funds: Fidelity. For years one of the largest and most successful sellers of funds, Fidelity recently introduced a “fund picks” screen that organizes and presents the firm’s best no-load offerings according to their sector and investing style.

Should you Switch?

With more of us banking and investing online, the Web has become one of the first places we go to screen products and educate ourselves about important financial topics. The Monitor awards offer a useful filter from the noise — but they are still just that: a filter.

There’s no substitute for doing your own research on the topics that matter. You’ll find most of what you need right here — just enter a few words that describe what you’re looking for in the search box to the right of the DailyFinance logo.

What websites do you use to manage your finances? Which are the best? Please let us know using the comments box below.

Motley Fool contributor Tim Beyers didn’t own shares in any of the companies mentioned in this article at the time of publication. Check out Tim’s portfolio holdings and past columns. The Motley Fool owns shares of JPMorgan Chase, Citigroup, and Bank of America.Motley Fool newsletter services have recommended buying shares of Charles Schwab and BlackRock, as well as writing a covered strangle position in American Express.

A Switch List: Items to Remember When You Change Banks

If you decide to switch banks to avoid fees, here’s a list of handy reminders to make the transition smooth and complete, courtesy of NetBanker, an online finance and banking website:

• Register for online banking at the new financial institution and reset your preferences and security settings.

• Find convenient and free ATMs that support your new financial institution.

• Contact the merchants, insurance companies and financial institutions who use preauthorized debit to grab money from you each month, and switch them to the new checking account. (Keep this list and verify that they have done it in the time period they promised.)

• Contact your HR department to switch payroll direct deposit to the new account

• In your old bank’s online banking, write down biller and payee contact info and capture any history you want to record. Enter the biller info into your new account.

• If you used e-statements, download and save all prior statements on your computer.

• Keep the old account open until online bill payment is up and running at the new account. Then re-enter those upcoming payments into the new online billpay (double checking that they will be processed before the due dates so you won’t incur late fees.) Then cancel all the pending payments in the old account.

• If you have a car loan or mortgage at the old financial institution that offered a discounted rate for automatic payments from their checking account, you may want to keep the old account open with enough cash in it each month, until those loans are paid off.

• Establish email and mobile alerts at the new financial institution.

The Long-Term Relationship You Just Can’t Quit

It’s an abusive relationship and you’ll probably never end it. Time and again your partner takes advantage of you. You lost trust a while back. You don’t even expect any satisfaction anymore, but it’s been going on so long you just can’t break away.

No, not your spouse. I’m talking about your bank.

For all the anti-bank anger erupting across the country lately, relatively few of us are actually parting ways with our significant financial institutions. In the past six weeks a mini bank-run sent 700,000 new customers to credit unions, according to the credit unions’ trade group. But that’s hardly noticeable on the scale of the universe of U.S. banking customers. Analysts predict that the percentage of people changing banks in 2011 could edge up to 10%. That’s only a slight lift from 8.7% in 2010, according to a retail bank survey earlier this year from J.D. Power and Associates. Momentum is building, to be sure, but it’s not yet significant.

Sometimes it seems like it’s easier to walk away from a marriage than a bank account: After all, spouses don’t have an entire team of MBAs working to make sure you never leave. And face it, your whole life is tied up with the conveniences of big banking: Your paycheck is deposited, your bills are paid, that quick trip to the ATM is right across the street. Maybe even your alimony and child support are on auto pay.

It’s not actually easier to get divorced, of course. Far more people are leaving their banks each year than are leaving their partners. But it’s not for want of trying on the part of the financial institutions.

Banks invest hundreds of dollars per customer to make your relationship to them last and grow: new products, savings rates, rewards programs, overdraft protections, credit cards, mortgages, home equity loans, bill pay, direct deposit, weekly letters, pens and free lollipops. It works too. A typical banking customer reports having an average of 2.7 “banking products” from their primary institution, according to J.D. Power and Associates.

Worse yet, many people can’t even afford to leave their bad bank marriage. That resentment-building $10 monthly checking account fee — some of which goes to pay for the shiny new branches you see all over town — may be the price one must pay to avoid a huge, and potentially disastrous, transfer of a whole system of electronic payments and credits.

At least 42% of all American workers lived paycheck to paycheck last year, according to a CareerBuilder.com survey. Increasingly, those funds are delivered electronically through direct deposit. Bills like credit cards, mortgages, rent, student loans, utilities, cable — not to mention regular subscriptions like Netflix — are increasingly tied to checking accounts via automatic bill pay.

How do you divert a paycheck next month into a new account while making sure all the bills get paid for last month? It’s tricky to choreograph when you live close to the bone. And banks know that.

“The bottom line is that you can’t move the account if you don’t have extra cash to leave behind for two months,” Hank Israel, a director with consulting firm Novantas, told The New York Times last year in an article on switching banks.

It is a lot harder to change something than it is to not change it. In behavioral finance this is called the status quo effect. Plenty of bad marriages — and bad banking relationships — have lasted many decades on this principle.

Of course, bad behavior from a bank is easier to ignore than that from a spouse. You can leave statements unopened, but you can only hide from your significant other for so long without severe consequences.

“Banks are just caretakers, they don’t have opinions. Spouses have opinions,” says Maggie Baker, a clinical psychologist and author of Crazy About Money. “You don’t get into an argument with your bank account.”

How Steve Jobs Changed the Way We Spend Money

Steve Jobs revolutionized so many aspects of our lives. One often overlooked area: Our money.
How Steve Jobs changed the way we spend money
Jobs fundamentally changed wired Americans’ relationship with their finances — from how and when we shop and bank to our awareness of our net worth.

When Apple (AAPL) launched the iPhone in 2007, people were already banking online — but the development of iPhone apps devoted to personal finance launched a rapid evolution in the way people handle their money. Want to deposit a check from your living room couch? There’s an app for that. Transfer funds, pay bills, balance your virtual checkbook? There’s an app for that too.

It’s easy to forget that these are all functions that were not long so ago handled almost entirely through brick-and-mortar branch banking. Recent research from the American Bankers Association showed that since 2009, online banking has become the preferred way to bank for customers doing their day-to-day interactions.

To be sure, the mobile banking revolution is only in its infancy. While 62% of those responding to the recent ABA survey say that they preferred to do their banking online, only 1% said mobile was their preferred way to bank. But since the beginning of this year, Capital One (COF) reports around 450% growth in the number of customers accessing their accounts online and with mobile apps such as those on iPhones and Android-powered smartphones.

“The iPhone and iPad have completely upended the balance of power in the world of personal finance,” says Brad Stroh, CEO of personal finance web site Bills.com. “Consumers now have access to real-time rates, account balances and budget spend at their fingertips — all on a device in their pocket.”

Yet on the flip side, the iPhone and iPad allow us to spend money anytime — and that can be devastating for anyone trying to rein in spending.

The Apple mobile devices have helped to create a new consumer ecosystem — helped along by the prevalence of debit and credit cards — of micro-payments. From buying a $9.99 ebook or a 99¢ song or game on iTunes, or a $2.99 grande Americano at Starbucks (SBUX), the number of such small electronic purchases is increasing.

But even as Americans spend money in increasingly snack-sized bites, the iPhone has helped create a gateway for monitoring spending and personal finances in small, daily chunks as well, rather those longer weekly or monthly account-keeping sessions of yesteryear.

“People are trying to keep up with the [increasing] velocity of money,” says Jaidev Shergill, CEO of the personal finance web site Bundle.com. He adds that mapping spending habits, a task easily performed through GPS-enabled iPhones and smartphones, is adding another dimension to the way people use their money, and driving the growing trend for localized deal offers by businesses and services.

Ken Sun, who leads the mobile team for the personal budget app and website Mint.com, says the iPhone has changed people’s relationship with money for the better. “The human memory is faulty and now you have an impartial observer,” Sun says.

A Too-Convenient Truth: Your Bank Has You Hooked on Auto-Pay

Banks Hook Us With Auto-Pay

Do you feel stuck with your bank? You’re not alone. As anger over high bank fees grows, the issue is gaining a lot of traction.

Many of us have set up our bank accounts online to pay our bills and receive our paychecks automatically. These conveniences come with a steep price. As The New York Times reported Sunday, banks use auto-pay features to hold onto customers. Knowing it means figuring out how to shift all those auto-payments keeps many from switching — even in the face of onerous bank fees.

According to the story, a marketing study by tech finance company Fiserv showed that using the Internet to pay bills, do automatic deductions and send electronic checks reduced customer turnover for banks by up to 95%. Other evidence that fewer people are switching institutions: In 2011, only 7% of consumers have switched banks in 2011, compared to 12% in 2010, according to surveys by Javelin Strategy and Research.

Recognizing that it’s too difficult to switch banks and worried about what that means for competition, the Australian government is considering a bill designed to make it easier for consumers to switch banking institutions. The bill proposed earlier this year would force banks to reroute bills to the new bank for 13 months after an account changed institutions.

Meanwhile, more than 42,000 people on Facebook are attending “Bank Transfer Day,” a virtual event initiated by a grassroots movement. Scheduled for Nov. 5, it’s aimed at mobilizing consumers to move their funds from retail banks to credit unions. Third-party operators such as this Switch Agent service are also making a play to capitalize on account changers.