529 college savings plans allow you to save for higher education, and you may qualify for some tax benefits.

Most parents invest in mutual funds, hoping they'll be able to earn enough (combined with their contributions) to create a healthy college fund.  However, those accounts can also lose money.

For a government guarantee, you'll need FDIC insurance on your 529 savings.  This is hard to find, but Virginia's 529 program recently added an FDIC insured option for conservative savers.  You don't have to live in Virginia to use the program, but you should investigate your home state's program before using a different state's 529.

Before you get too excited, consider whether or not you need FDIC insurance on your 529 savings.  You won't lose anything on insured deposits, but you'll only earn bank-like returns.  This may or may not make sense, depending on your situation.  A financial planner and tax advisor can help you understand how a 529 will impact your finances.

Further reading:

• Overview of 529 Plans
• Saving for College from About.com
• How FDIC Insurance Works

If you download bank transactions into any program or online service, you know that you have to use specific file types.  What if your bank doesn't give you what you need?

Geeky Chick describes her struggle to convert CSV to QIF ("when your bank is too lazy or stingy to do it for you").  By using an Excel add-in, you can get your data into the right format.

With all the bank failures, mergers, and changes going on, you may find this information handy.  Banks sometimes transition your account to a new system, and you may have to adapt.  You can also use conversion tools to slice and dice data in ways that your software doesn't allow.

I have not used the product she mentions.  Take precautions before downloading, installing, and working with sensitive banking information.  Make backups of your existing data, and do some homework to make sure the software does not contain anything that will harm your computer or steal your information.

Banks with reward checking accounts are taking a closer look at customers to see if they're profitable.  Bankdeals shares a recent example, where a bank asks customers to get with the "spirit" of the program.

Reward checking accounts can pay more than a savings account or CD.  To qualify for the rate, you have to meet some requirements.  Generally you have to use your debit card 10 or more times per month.  If not, you earn little or no interest that month.

Banks earn money when you use your debit card for purchases.  That money helps them pay the above-average rates found in reward checking accounts.  If you only use the card for low dollar items, the bank earns very little - and they can't afford to pay those high rates.

Interchange fees, the fees banks collect when you use your card, have been under attack recently.  They raise the cost of doing business for merchants, and provide nice revenue for the banks.  Given the double-whammy of interchange fee attacks and customers working the system, we may see reward checking accounts get a lot less rewarding.

Further reading:

• Reward Checking Basics
• High Yield Checking Deals

In the wake of 2009's 100th bank failure, the FDIC is trying to get the word out:  taxpayer money does not cover FDIC insured deposits.

Sheila Bair stressed yesterday that FDIC insurance funding comes from contributions of member banks.  FDIC insured banks pay into the fund in case other FDIC insured banks fail.

While money doesn't come directly from the US Treasury, somebody pays for it.  As insurance premiums erode banks' returns, they'll pass it on to us in the form of higher loan rates or lower deposit rates.  Also, the FDIC technically has the backing of the US government - so if things got really really bad we'd be on the hook for losses.

I can see why Bair is making this distinction, but I don't think she'll get much mileage out of it.  Most "bailout fatigue" seems to be a result of huge payments to firms that survived, not the $25 billion of losses to FDIC's insurance fund.  Perhaps that's her point.

• What Happens in a Bank Failure?
• How FDIC Insurance Works

We reached the unfortunate milestone of 100 bank failures for the year on Friday. The count valuted to 106 after 7 banks went under.

Given predictions made last year, that's not as many as I'd have expected by now.  Experts still predict we have several hundred more to come as a result of the financial crisis.

It seems there's a reason for the low number.  The Associated Press suggests that the FDIC is moving slowly.  They're hoping for economic recovery, finding buyers, and trying not to create a panic.  Of course, if you understand the nature of FDIC insurance, there's no need to panic as long as your money is insured.  Anybody with uninsured deposits should be aware of the threat and is hopefully already doing something about it.

• What Happens in a Bank Failure?
• How FDIC Insurance Works

P2P lending is a good option if you need a loan.

It's not the only option, and you should still compare offers from traditional banks and credit unions.  However, it's been more and more difficult for individuals and businesses to get money from traditional lenders.

While peer to peer networks have helped, they've faced headwinds over the past year.  Regulators weren't sure what to do with them, so P2P services had to spend time with the regulators figuring out what rules to follow and how to move forward.

A new effort from P2P services hopes to streamline that process and make it easier to do business.  The Coalition for New Credit Models recently launched to help lawmakers understand and accept innovative financial services.

When I first saw the press release, I figured they were hoping to market a new campaign for consumers.  Instead, it looks like they're getting serious about working with legislators - a lofty goal right now.  "Innovative" financial products are not exactly popular these days, so they'll have to let everybody know what they mean by innovative.

Further reading:

• How Peer to Peer Lending Works

Banks ding you when you spend more than you have, and the dinging has gotten ugly.

Overdraft charges have been in the headlines lately.  Banks recently eased up on overdraft policies, but they're still under fire from lawmakers.  The fees can be abusive, and the people who pay most of them are least able to do so.

Yesterday Senator Dodd pushed a bill that would reduce overdraft charges by limiting the cost of each occurrence, how often you pay them, and the way banks use them.

Consumerism Commentary recently published a summary of recent overdraft changes and proposed legislation, complete with a chart and a handy bulleted list.

Further reading:

• Checking Account Essentials

Reward checking accounts pay high interest rates on checking balances.

You earn money - sometimes more than a CD - and you still have access to it.  However, you have to jump through hoops to qualify for the highest rates.  Bankdeals recently highlighted some of the most common ways you can end up missing out on some of that interest, and what to watch for when opening an account.

In general, you have to bank online, use your debit card frequently, and set up direct deposit or an automatic transfer into the account.  These requirements help the bank earn revenue, and ideally they pass it on to you with higher deposit rates.

Commenters at Bankdeals discuss these requirements in more detail.  You'll find that some customers work the system, earning high interest rates without providing revenue to the banks.  Of course, that'll never work over the long term.

If you're looking for a reward checking account, look for one that has a sustainable model and is more difficult to abuse.  You'll enjoy the experience more, and you won't see rates drop once the bank gathers needed deposits (or gives up on an unprofitable product).

Further reading:

• Reward Checking Basics
• High Yield Checking Deals

About ten or twenty bucks.

Investigations in Florida revealed how much food service workers earned for selling payment card numbers to crime networks.

When you hand your card over to a waiter (or use it at the drive-through window), they have a chance to "skim" data off the card.  The most efficient way for them to do this is to swipe the card through a small device that stores the information for easy downloading later.

Most employees do not do this, but you should think twice before handing your card to somebody who can take it out of sight.  It only takes a split second to swipe the card, and really talented scammers can do it in their pocket without you noticing.

This should also make you think twice about which cards you use - is it risky to use the debit card from your primary checking account every day?  Assuming you don't pay interest, would it be better to use a credit card so you don't risk overdraft charges?  Consider the tradoffs of using debit vs credit cards in everyday life.

A recent survey sponsored by Fiserv found that 4 out of 5 households with Internet access do at least some banking online.

A  majority of these users pay at least one bill online, while the remainder just view balances and transfer money among bank accounts.

There are plenty of reasons to bank online.  The survey respondents highlighted (from Fiserv's press release):

• Speed - 79 percent of consumers said that they preferred to pay bills online because it was faster than other payment methods.
• Ease of Use - 72 percent of consumers said paying online was easier than paying by check.
• Cost Savings - 71 percent of consumers said they liked saving money on stamps.
• Control - 71 percent of consumers said that paying bills online gave them more control over the timing of their payments.

Some said the environment is an important part of why they pay bills online.  However, keep in mind that only electronic payments (ACH payments) are paperless.  Sometimes when you pay a bill from your bank's website they print a check and mail it to the payee (using paper, fuel to ship the payment, and ink).

Do you bank online?  Tell us why or why not in the comments.