How To Avoid Bank Fees

 The key to having more money is not always about just making more money. It can be as simple as being a wise financial steward and holding onto the money that you already currently have. You have to maximize the earnings on the money that you currently have. This means maximizing the earnings that you earn on your bank savings. Since banking is a necessity, it’s easy to overlook overlook all of the fees that your current bank is charging you. Many people associate maintenance fees and overdraft fees as being a cost associated with having a bank account. This is not true. You can avoid bank fees and expense charges by being wise with your financial management.

Skip Banking Fees

However, if you haven’t noticed, banking is big business. In 2015 the nation’s three largest banks JP Morgan Chase, Bank of America and Wells Fargo had a combined revenue of 6 billion dollars from ATM and overdraft fees on checking and savings accounts.

Decline Overdraft Protection

The best way to minimize the number of fees that you pay to your financial institution starts with proper account management. The overdraft or insufficient funds fee is the largest of the fee that account holders incur. This year’s average overdraft fee is $33.36.  Overdraft fees occur when an account has insufficient funds to cover the daily charges that are posted to the account. Depending on how your account is setup, your bank may choose to simply refuse payment and return the check. If your account has overdraft protection, your bank will honor the check causing your account to reflect a negative balance.  In either scenario, your bank will charge your account an overdraft fee or insufficient funds fee for each occurrence.  

Maintain a Minimum Monthly Balance

If you have perfected the art of proper account management, you might think bank fees are reserved for those who haven’t. Nothing could be farther from the truth.  Monthly maintenance fees, which average $13.58 per month in 2019, are penalties that banking institutions charge account holders when they fail to meet certain conditions. The conditions to avoid monthly maintenance fees often vary from bank to bank, but the results are the same. Maintaining a minimum monthly balance requirement make it possible to bank free of charge. 

For example, Bank of America waives there $12.00 maintenance fee on their Advantage Plus Banking providing the account holder has a minimum direct deposit of $250 per monthly cycle. At some banks merely having your weekly paycheck direct deposited qualifies you for maintenance fee free checking. If you don’t have a regularly scheduled direct deposit, the monthly maintenance fee is likewise waived if you maintain a minimum daily balance of $1,500.  

Use Your Bank’s Network ATM’s

     The fee that hits home for most people is the out of network ATM fee. When you use your ATM or debit card to withdraw funds at a banking institution other than your own, you incur a series of fees. You are charged by both the out of network banking institution as well as by your own. The average combined fee from both institutions for out of network withdrawals is roughly $4.72 per occurrence. That’s a steep price to pay to access your money. Like the account maintenance fee, there are steps that can be taken to avoid out of network ATM fees. The first being, restrict ATM withdrawals to institutions at which you hold accounts. Secondly, get cash back at a local grocery store in lieu of an out of network institution’s ATM. Finally, open bank accounts with institutions that offer free out of network ATM withdrawals or unlimited ATM fee reimbursements.