How To Avoid Bank Fees

If you’re like most people, you start your bank account with the best of intentions, yet find yourself paying anywhere from $2-$100 a month in bank fees. The main way to avoid bank fees is to pay close attention to the policies of your bank or financial organization, and then make sure you don't violate those policies.  There are a few things that your bank agent goes over with you when you open the account.  You will often probably factor these into your decision when you're choosing a bank; ultimately, you'll try to make the decision that is most likely to prevent excessive fees. 

Depending on the type of bank account you've selected, some fees are completely unavoidable.  Remember to check the bank literature that you were given when you opened the account to see if your account has automatic monthly fees.  These fees are usually pretty reasonable for personal accounts (under $10), and a little more for business accounts (around $20).  If your account is an account that already has fees attached, you might have to visit your bank to close that account and open a new account with no automatic monthly fees.

Assuming that you already have an account and are getting charged regular fees, there are a few things that you can do to ensure that you are not paying additional fees every month.

The main cause of most bank fees is overdraft.  Overdraft is when you spend more money than you have in your bank account.  The bank covers your spending, but charges you $25 - $35 per debt.  Overdrafts can rapidly pile up.  If you unconsciously go over your balance for lunch and gas one day - even if you only spend $5 for lunch and $10 on gas - you can wind up owing that $15 for lunch and gas plus an additional $70 in overdraft fees.  You must keep an eye on your spending if you want to avoid overdraft fees.  Check every day to make sure that you have no pending transactions.  Some banks show pending transactions in your balance, which is very helpful; if your bank does not provide this service, you have to do the math yourself.  Just because you use a check card doesn’t mean you shouldn’t be keeping up with your spending like you would with a checkbook.

Finally, many banks reward customers who enroll in certain banking programs.  It is often possible to sign up for a bank account which will waive standard monthly fees if you keep a minimum balance in your account.  You need to keep the correct minimum balance if you agreed to that type of account.  If you go under your balance, you will get a fee; once your account is back over the minimum, your bank may continue to charge the fee unless you contact them and specifically request that they lift the fee.  Also, enrolling in programs such as online bill pay and direct deposit can help you cut down on bank fees - check your bank's policies.


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