Getting too many banking charges at the end of the month or as transactions occur can be outrageous. Sometimes, we over look the charges especially when they are deducted as transactions take place, but at the long run, we discover that the banking fees are reaping us off as the fees sum up to reasonable amounts.
These charges are more common than you might think. Bank fees can be for many reasons, which some of them are avoidable. They could be for overdrafts, which can compound; it could be for transfers; account balance or statement of account request; withdrawals; deposits; account and ATM maintenance, and so on. Fees can even be imposed for non-sufficient funds.
According to information by Statista, Americans waste average of $7.69 per month (amounting to $100 per year) on banking fees, and these fees cover only overdrafts, ATM and monthly service costs.
Ways to Avoid Bank Fees and Charges
Bellow are 8 ways to avoid unnecessary bank fees and charges:
- Accept Direct Deposits and Transfer
- Use Your Bank’s ATMs
- Avoid Extravagant Spending
- Sign Up Overdrafts Protection
- Avoid making unnecessary transfers
- Subscribe for transactions alerts and notifications
- Maintain Required Minimum Balance
- Request for e-statement of Account
1 Accept Direct Deposit
If you are salary earner and your employer offers direct deposit for your paycheck, you should sign up for direct credit of your account by your company. It is both convenient and saves you costs. Your salary goes straight into your bank on payday, saving you the stress of going to the bank and waiting in queue to make the deposit of your paycheck. Not only that, many banks don’t charge on direct deposits/ transfers made into salary accounts.
As a business owner, accept direct deposits or transfers from your customers. It will save you both the stress of handling cash and deposit fee bank will charge when you deposit cash by yourself.
2 Use Your Bank’s ATMs
Banks provide their ATMs at their branches and strategic locations across the country, which their customers can transact on as many times as possible for free, except for the normal monthly ATM maintenance fees. But when you use ATM provided by another bank, you pay extra fee. If you frequently make withdrawals from ATMs operated by banks other than your bank, these fees will add up to something reasonable.
Also, when you patronize the agency banking and mobile money (aka POS) agents, you pay some certain amounts of charges for withdrawing, depositing or transferring cash. You can avoid these unnecessary charges by always using ATM operated by your bank. Learn how to make deposits at ATM.
3 Avoid Extravagant Spending
Your spending habit contributes immensely to the fees you are being charged by banks.
As you make frequent withdrawals, transfers, the fees will keep accumulating. Banks will also charge you for transaction alerts for each and every transaction. Banks will as well charge you a fee when you use your account and don’t have enough money to cover a charge. With recurring payments and subscriptions, such fees can happen unexpected. So to avoid this common bank charges, fight the habit of unnecessary and frequent spending. The Open Banking system, which allows third-party service providers to initiate transactions on your bank account, is fueling extravagant spending in many individuals.
4 Sign Up for Overdrafts Protection
Even when you avoid extravagant spending and watch your balance closely, overdraft can still occur. For that, many banks offer overdraft protection service to prevent such charges from taking place on your account. When you sign up for overdrafts protection, you link up another account (usually a savings account linked to your checking account, your bank will automatically transfer enough money from the linking account to cover any overage. Sign up to overdrafts protection service today, to leverage on it to avoid unnecessary charges. Some banks offer such service for little extra charge, while some banks like Ally Bank offer the service for free.
5 Avoid Making Unnecessary Transfers
Transfers can be quick and convenient compared to cash deposit, but it comes with a cost. You will be charged for every transfer you make. Also Wire transfers are quicker than traditional bank transfers, which normal takes up to three business days to complete especially when sending money abroad. It also costs more than normal bank transfers.
Wire transfer charge up to $35 per domestic wire transfer and more when sending a wire transfer abroad.
6 Subscribe for Alert and Notification
Keeping tap to what is happing with your account can help you avoid unnecessary charges. Banks offer alert and notification services for almost every activity that takes place on your account. Consider subscribing for the services fight off such extra charges.
7 Maintain Minimum Required Balance
Every class of account has a required minimum balance to maintain the account. Banks now charge you monthly to maintain your current/ checking account. Bank of America charges up to $12 per month for its Advantage Plus Banking account. To avoid such fee, you need to maintain a minimum of $1,500 or more daily balance.
8 Request for e-Statement of Account
Paper statement of accounts comes with charges, as paper is expensive. While electronic statement is free and does not require paper copies. It is also more convenient.
For instance, Bank of America charges fee of $5 for each statement of account copy. To avoid this kind of extra charge, request for electronic statement, it will be delivered to you via email, you can download and print by yourself, if need be.