Roth IRA Deposit Gone Awry

I have just gotten off of the phone after the better part of an hour.   I can’t be sure, but I think I’ve fixed a problem, that until today, I never knew existed.

The background -

I have a Roth IRA.  My wife has a Roth IRA.  One of my goals for 2009, is to fully-fund both Roth IRAs.  We have a joint checking account.  From time to time, I will send a payment (deposit) from our checking account to the brokerage where we have our Roth IRAs.  Clear enough?  Good.

The problem -

Last week, I logged in to my checking account, and initiated two payments (deposits), one for my Roth, one for my wife’s Roth.

Today, when checking on the status of said payments, I was shocked to find that the deposit intended for my wife’s Roth IRA was rejected.

Apparently, when my bank sends a payment to another company, the only name on the payment check is my name, even though the checking account is a joint account.  Well, when the brokerage received the payment, and noticed that my wife’s name was not on the check, they rejected the check, because they do not accept third-party payments.

The solution -

I called my brokerage, and they suggested that I send a copy of a recent bank statement, along with my wife’s name and account information, showing that she is, indeed, a joint holder of the checking account.  This sounded like a lot of work, and I’m just not in the mood for a lot of work.

I then called my bank, pressed zero fifty times, talked to a very nice CSR, and had him add my wife’s name to all future online bill payment checks.  Problem, hopefully, solved.

I also canceled the payment to the brokerage, the one for my wife’s Roth IRA.  Once the money, which has already been deducted from my checking account, is safely back in the account, I’ll initiate another payment.  Hopefully, this one will have my wife’s name on it, and all will go smoothly.


NCN

http://www.ncnblog.com

No Credit Needed is a personal finance blog about debt reduction, saving money, and simple living. Thank you for visiting the site and please consider subscribing to No Credit Needed by Email. Have a blessed day!

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4 thoughts on “Roth IRA Deposit Gone Awry
  1. Rezen

    wtf?

    “I called my brokerage, and they suggested that I send a copy of a recent bank statement, along with my wife’s name and account information, showing that she is, indeed, a joint holder of the checking account. This sounded like a lot of work, and I’m just not in the mood for a lot of work.”

    Faxing a bank statement is a lot of work?

    In the time you spent calling your bank getting them to modify their software system, you probably could have emailed/faxed/snailed ten statements along with your wife’s info.

    Honestly, I think you were just trying to make a point – not trying to avoid “a lot of work”. In the end, the result was (hopefully) the same … however the fundamental problem here is barriers – you weren’t in the “mood for a lot of work”, so you changed your behavior. You didn’t want or were unwilling to do X so you did Y instead. X became a barrier. What if your wife’s name STILL isn’t on your future online bill payments? Then you’ll be back at square one: facing a big barrier.

    This is a common problem with those of us that have (or had) financial problems – we build barriers to our financial success.

    Here is a guest article written by Ramit Sethi, author of the book “I Will Teach You to be Rich”, which discusses these “barriers” that we often build for ourselves, often without knowing we did:

    http://www.getrichslowly.org/blog/2009/03/17/the-psychology-of-passive-barriers-why-your-friends-dont-save-money-eat-healthier-or-clean-their-garages/

    Reading that article/post really opened my eyes, and made me more conscious of the decisions that I make today and how they will impact my future.

     
  2. When You Own Stuff Stuff Owns You

    Similar experience – Bank of America transitioned my Countrywide mortgage to their “system” this month. I have always paid Countrywide on-line with no “issues”. Set up the May payment as always, checked this morning and the payment never happened (I didn’t keep the confirmation number because I never had a problem before). Now I get to pay a service fee to BofA. $3 is no big deal and it’s certainly NOT WORTH THE HASSLE of calling customer NO Service!

    Can’t wait to retire this mortgage and be debt free!