Easy Tips to Avoid Paying Banking Fees
They say what goes up, must come down. But, does that really hold true? When it comes to banking fees, it seems that they only move in one direction: up.
From overdrafts to account maintenance and beyond, it’s becoming increasingly more expensive for consumers to perform even the most basic banking functions. In most cases, you will know what you’re paying for but then there are those times when fees may come up as ugly surprises.
Tom Feltner, director of financial services for the Consumer Federation of America, stated that “low upfront, transparent monthly fees are much clearer than those accounts that are advertised as free but have highly variable back-end fees like ATM fees and overdrafts.”
So, what are some ways that you could combat potential rises in fees? Here are a few tips:
Forget the Paperwork, Talk to Somebody
Do you ever feel like you’re swimming through piles of letters from your bank and are trying to make sure you read the fine print and understand all the terms? Sometimes, it could help to simply walk into a bank’s branch or call them directly to make sure that you receive the appropriate guidance from a representative. You’d be surprised at how much more you may be able to learn from a call than surfing the web to look up your bank’s legal jargon.
Stick with “In Network” ATMs
When it comes to ATMs, you just want to withdraw from the closest one you can find; however, you may get doubly charged. Both the ATM provider as well as your own bank may charge you for using an ATM that is considered “out-of-network.” Consider using your smartphone to quickly locate a nearby ATM via your banking app or stop by a grocery store or drug store to get cash back for a small purchase using your debit card.
Online Banking vs. Traditional Banking
Relatively speaking, it is cheaper for banks to maintain online platforms as opposed to traditional physical branches. Given the benefit of lower costs, online banks are able to pass along cheaper costs to their customers since they are spending less than the traditional banks to service needs. If you are comfortable banking online, then it may be worthwhile to make the switch.
Banks have a strong interest in retaining you as a customer. As long as you possess a strong banking history and have demonstrated responsibility, a bank will want to continue doing business with you. You may be able to speak with your bank to have them forgive an overdraft fee or late credit card payment fee.
Additionally, you may be able to have certain fees waived if you sign up for other banking services such as paperless statements or direct deposits. These options may vary so it would make sense to check with your specific bank and see what is possible.
Read the Notices
Per regulations, banks are required to send you alerts about new fees. These notifications can be sent through your mail or virtually flagged in your online banking platform. Regardless of the method of delivery, you should try your best to make sure you are aware of any recent communications in order to avoid any surprise fees or charges.
Mix It Up
There is no rule stating that you must bank with only one financial institution. In fact, you could choose a few banks that best accommodate your needs. Banks may be competitive in different ways and you can fully take advantage of that by dividing up your banking needs as you see fit.
Don’t Opt In
What happens when you pay for something with your debit card but realize you don’t have enough money in your account? Your bank can cover the cost but it comes at a steep price that is sold to you as “overdraft-protection.” Due to recent regulations, banks are required to ask whether you want to opt in and can no longer automatically enroll you into the program. By opting in, banks allow you to use your debit card and charge you a hefty fee each time you have a shortfall. One solution is to ask your bank to link your checking account to your savings account thereby creating your own overdraft protection.
Given the changes in the financial services industry and increased regulation, banks are facing more fees, charges, and penalties themselves. In some cases, these may translate to costs that are being passed along to the consumer. Therefore, it is important to stay on top of the latest changes to affect your particular bank and strategize how you can limit your costs and increase savings.