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You Can’t Expect
Something for Nothing… But often you can pay less in bank
fees.
You can’t expect something for nothing. After all, banks are
for-profit businesses, subject to taxes and the demands of
stockholders. Still, there are many things you can do to limit
the fees you pay. Here are some suggestions:
• Review your monthly mailings and see how much you’re
paying in fees. Then ask your banker about ways to reduce or
eliminate those charges. If you write very few checks each
month, for example, consider a cheap, no-frills checking
account, sometimes referred to as a “basic” banking account.
But always read the fine print and think through the costs of
any move, such as what you might lose in interest by moving
money from a savings account into a checking account just to
meet the minimum balance requirement.
• Every few years, if not more frequently, compare your
bank’s costs to those of a few competitors. You may find a
great bargain elsewhere or discover a better deal at your
current bank. When comparison- shopping, concentrate on the
accounts and services you actually use. Don’t be concerned
about analyzing every product or fee you see listed. Also be
aware that a low interest rate offered on a credit card or
another loan may just be an introductory “teaser’ rate that
could go up substantially after a few months.
• Your bank might give you a special deal on your checking
account ifyou arrange for direct deposit of your paycheck.
Having funds automatically deposited into your account also can
help avoid bounced checks.
• Banks want to encourage customers to do most of their
banking with them, so if you have more than one account at the
bank, you may qualify for no-fee or low-fee offers. If you have
money in both checking and savings accounts, ask whether the
balances could be combined for purposes of meeting the bank’s
minimum balance requirements.
• Look into special deals if you keep a certain amount in your
account, arrange for direct deposit, or do a lot of your banking
electronically (ATMs, banking at home by computer).
• Some banks offer “clubs” with special offers or savings
for certain groups, such as senior citizens. Check these out.
• Limit or avoid “surcharges” (access fees) at the
automated teller machine by using your own bank’s ATMs or
those owned by institutions that don’t charge fees to
non-customers. If you do pay a fee, consider withdrawing larger
sums each time so you’ll cut down on the number of
transactions. (For more tips on how to reduce ATM fees, see our Spring
1998 issue.)
• If you’re a good customer with a clean record, your banker
might be willing to refund an occasional service charge for a
late credit card or loan payment, a bounced check or some
similar offense. You might also be able to get a lower interest
rate on a credit card or other loan.
• Avoid bounced checks by balancing your checkbook regularly
so you can keep an eye on the bottom line. Jean Ann Fox,
director of consumer protection for the Consumer Federation of
America, says “it’s getting harder and harder, especially
for people with joint accounts, to keep track of an account
balance because there are so many variables beyond just paper
checks.” She said, for example, that consumers should
immediately deduct from their balance for ATM withdrawals, bank
fees, and debit card purchases at stores.
• With “overdraft” protection, the bank will automatically
honor a check you write even if you don’t have
enough funds in the account. While overdraft protection avoids
bounced check fees (imposed by banks, stores, landlords, etc.),
Fox notes that the service does come with costs, so be sure it
really would save you money.
• Consider buying checks from mail-order companies, especially
if you write a lot of checks each month and the cost-savings
could be significant. Before placing your order, ask your local
Better Business Bureau or state consumer protection office
whether the company is legitimate.
• If you don’t care whether you get your canceled checks
back each month, you might qualify for a special deal on your
account.
Disclaimer: All Information on this web site is provided "as is" with no claim of accuracy or of fitness. Always research any financial decisions prior to signing any documents and consult a professional when necessary.
For additional Information:
Federal Citizen Information Center