The dreaded bank fees. While keeping your money in some sort of a financial institution is largely unavoidable, often users will be hit with costly and annoying fees. In fact, in 2018, over $34 billion was paid by Americans in overdraft fees alone.
So, how do you avoid being charged exorbitantly by your financial institution? Let’s take a look below at some smart ways to eliminate bank fees that might keep (or put) more money in your wallet at the end of the day.
Do Your Banking Online
Not only can you save money on getting paperless statements with your online account, but you can also skip exorbitant ATM fees if you choose a bank like Schwab or Ally; the preceding banks do not charge any fees for maintaining a checking account and will refund any ATM costs that you may incur.
Utilize Student Savings
An often unknown perk of being a student is that many banks won’t charge you any monthly service fees for your checking or savings accounts. If you’re in college or high school, be sure to contact your bank and ask what discounts or promotions they have available to their students.
Don’t Sign Up for Overdraft Protection
Overdraft protection is there for when you don’t have enough balance in your account to cover a purchase, however, the amount you’ll pay in fees for this overage protection can be rather steep. Say for instance you go to purchase lunch, and your bill is $10 if you only had $5 in your checking account your overdraft protection will kick in and cover the cost but will charge you a fee of $30. Presto – a $10 lunch just changed into a $40 one! If instead, you did not have overdraft protection and your card declined, you would then at least have the option to use another payment method, cash, or skip on the purchase for the time being.
Talk to Your Bank
If you’re seriously unhappy with fees that your bank is charging you, see a fee that you were not expecting, or were hit with an overdraft fee; don’t hesitate to contact your bank and request the fee be waived. If you are in good standing with your bank, often the bank will waive or lessen fees with the intent of keeping you happy as their customer.
Maintain Your Minimums
Make sure you are aware of any minimum account balance requirements your bank has. If your checking or savings account falls under balance requirements, you could find yourself paying monthly maintenance and service fees until your balance is back above the line.
Utilize Direct Deposit
If your employer offers the option for your payments, utilize direct deposit. Many banks will waive fees based on the knowledge that you have automatic direct deposits coming in each month.
Spend Using Your Debit Card
There are a lot of banks that will reward you using your debit card a certain amount of times each month. You can see things like fees being waived, or even cash back rewards being earned. Similarly, if you run your debit card as a credit card, banks will sometimes reward this type of transaction with a cash back reward.
Pay Attention to Transaction Limitations
Some banks have limits on how many withdrawals and deposits you can make each month. It’s important to familiarize yourself with any transaction limitations in place so you aren’t charged any related service fees for exceeding that amount.
While credit unions can sometimes have stricter limitations on who can hold an account, they are well-known for applying fewer fees to their customer’s accounts. It’s something worth checking out if your bank fees and service charges are adding up each month.