Saturday, December 17, 2011, AM | 2 Comments
Banks received big cash when the bailout money worth billions were distributed among financial institutions. Still, the banking industry’s hunger for more money has not diminished.
This time, they want your money – directly out of your pocket.
Here are 3 tips how to reduce banks rising fees on your account:
Eliminate ATM fees
The banks make money and lots of it if you use another bank’s ATM. Let’s say you withdraw $20 using your ATM card from a bank where your plastic is considered foreign, you pay as much as $3.50 in fees.
That is more than 17% on your $20 withdrawal. If you cannot find your bank’s ATM nearby, use your debit card to get cash back from a retailer – that will cost you less.
Lowering interest rate on your account
Not only the banks are raising ATM fee, they are lowering the interest rate they are supposed to pay you on your account.
How low, you say? How does less than 1% sound on a checking account? That was the average in 2008.
What’s more, the average minimum required to avoid a monthly fee has increased to $3,500.
What you can do is find a free checking account to keep your bill-paying money handy; the minimums on these accounts are usually $110.
Keep the rest of your cash in a high-yield savings account, and transfer money to your checking account when needed.
Eliminate overdraft fee from your account
Banks process checks and debit card purchases in order of biggest to smallest, rather than sequentially.
That means you are more likely to have multiple overdrafts – and multiple overdraft fees, at an average of $29 a pop.
What you can do is link your checking and savings accounts.
Alternatively, some banks will let you link your checking account to a credit card, which will be charged with the overdraft amount.
In a Nutshell
Banks, like any other company, are in the business of making money. However, watch out for banks where they charge you more than another bank in your neighborhood.
There are ways to protect yourself from paying, in fees, more than you have to.
Just be on the lookout to save money.
The different kinds of fees add up and you could be losing $100s from your account in a given year.Facebook.com/doable.finance