I recently noticed that my monthly mortgage payment had increased by a modest amount. I received a notice that they were adding about $15 a month as a “reserve requirement” for my escrow fund. As you are aware if you’re a home owner, the bank collects extra money from you each month for an escrow fund, which it then uses to pay your real estate taxes. A nice service, because you then don’t have to come up with many hundreds of dollars every six months to pay your taxes.

However, as I found in a recent post in a financial planning newsletter (http://www.ricedelman.com/cs/education/qa_questionable_reserve_requirement), this extra reserve isn’t a requirement at all! They’re simply holding onto your money, in case there’s an “unexpected” expense. That’s nice for them, because they can then pocket the interest on your deposit. A quick phone call, and they offered to remove the extra $15 “requirement”–I didn’t even have to argue with them! They even told me they had an extra $150 in my escrow account, and would I like that returned to me? Well, duh!

So the next time you see an unexpected charge, pay attention. Even if they say it’s required. Ask questions. And if you’re tired of dealing with the big banks, you have options: check out http://moveyourmoney.info.

In addition to preparing for a New Year’s Eve party, some of you also might be addressing some end-of-year financial matters.

If you need help finding professional financial assistance, Brandon Green Companies has excellent contacts—brokers, CPAs, tax advisers—to which we’re happy to refer you.

Please e-mail us if we can be of assistance.

And have a great new year!