A client of mine, John, called last month asking what he should do with some extra cash sitting at a local bank. I asked what “extra” meant and what he wanted to accomplish. He paused for a moment and said, “Well Joe, I have more than the FDIC limit in three local banks I haven’t told you about yet.”
I laughed and told John we needed to meet soon. I asked him to bring all bank statements so we could put together a proper plan. I added that I need to know where his assets are to give the best advice.
John’s story isn’t unusual. Many Texans trust local banks more than large national institutions because community banks feel personal and tied to the town. I understand that. But blind trust can hurt you financially if you don’t know how banks really work.
