Avoid Checking Account Fees With These Simple Tips
In the last year, the banking industry has made billions of dollars in checking account fees as the economy has nose-dived and many people have struggled with making ends meet. In fact, the banks made around $24 billion dollars in overdraft fees alone. For financial stability, it is very important to know how to avoid unexpected checking account fees which can add up very quickly and end up costing the account holder hundreds of dollars per year.
Avoid Overdrafts
One of the biggest revenue streams for a large bank is the money that they bring in from overdraft fees to checking accounts. These fees have been so lucrative for the banks that they have increased the amount of the fee from average of $10 per day to an average of $30 per occurrence and there is no limit to the number of fees you can be charged for a single day. Debit cards have increased the chance that people will overdraw their accounts without knowing and can rack up a large number of fees in a relatively short period of time. It is very important to know the balance of your checking account and track all of your purchases to avoid incurring overdraft charges.
Review Your Checking Account Options
Most banks have a number of different checking account options for people to choose from with different fee levels for each type of account. Some checking accounts require a minimum balance while others place a limit on the amount of checks you can write or the number of times you can conduct a teller-assisted transaction. By reviewing these options carefully and comparing accounts across banks, you can ensure that you are not paying for features that you do not need and that you are not going to be charged a penalty for having a lower balance or using more checks than the checking account allows for.
Use Your Bank’s ATMs
Nearly every bank charges a fee for using any ATM branded for a different bank, typically $1.50 to $3.00 per transaction, and that is on top of the fee that the other bank is going to charge for drawing money out of their ATM. Although this amount may not seem like much during the transaction, using a different bank’s ATM once a week will cost you between $182 and $260 every year in ATM fees. These fees also increase the chance that you will overdraft your account because many people do not take these fees into consideration when balancing their checking account. Plan your ATM withdrawals carefully so that you can avoid having to draw money from another bank’s ATM.
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