New customer of Sovereign Bank

As I mentioned yesterday, I was seriously looking at opening an account at Sovereign Bank here in Manhattan. I went ahead and opened the account this morning. Actually, I opend three accounts, a business checking account, a business owner "premier" personal checking account, and a personal money market account. This evening I went through the process of registering for online banking. Now I am basically waiting for the ATM "check" cards (one for business, one for personal) which may take 7 to 10 business days.

I also went ahead and linked the personal checking account to my Fidelity account. Unfortunately, the Fidelity Web site now says that it may take 7 to 10 days to verify by bank information. I have done this a couple of times before, but I do not recall it taking that long before or the Web site saying that it might take that long. I think that all they really need to do is send a very small payment (a dollar or less) and see that the transaction completes. I suspect that they may have added a delay to make it more difficult for people to quickly decide to move their money from Fidelity to a bank.

My next step is to sell $15,000 of my Fidelity Select Money Market fund (FSLXX) and then transfer that to my new Sovereign personal checking account once Fidelity verifies the status of my new bank account. From there I will transfer the cash to the money market account. Once I do that, all I need to do is use the two check cards a total of six times each over 90 days and Sovereign will credit my accounts for $300 within 15 days after a 90 day period. That will be on top of the extra interest I will earn on the $15,000 in the Sovereign money market account.

Actually, I just took my next step, which was to link my new personal checking account to my PayPal account. Since my new money market account will pay a higher interest rate than Fidelity or PayPal, I will shift some of my PayPal savings to Sovereign Bank. PayPal just started the process of making two small payments (each less than a dollar) to my checking account. Once I see those payments appear in my checking account I enter the amounts in PayPal and that completes the bank account verification process, and then I can transfer a pile of cash. PayPal says it could take several days for the verification transactions to be completed. PayPal is currently paying a 2.35% 7-day yield.

I may also look into setting up a second money market account to use for keeping my accumulating estimated income tax money separate from "my" money. I was using the PayPal account for that purpose. But, since that is a smaller amount of money in a separate account, it will earn a lower interest rate of 2.50% APY.

I am thinking that I will probably want to raise my main money market account to $25,000 since the interest rate then goes up to 3.00% APY.

And all of this is 100% FDIC insured and 100% instantly liquid. I have considered a CD, but the nature of my current career and financial situation dictates that I be as liquid as possible, for now.

-- Jack Krupansky