The 3 Certainties in Life: Death, Taxes and Bank Charges

Whatever you do in or with the bank costs you money, from talking to a teller to withdrawing a large amount of cash. Agreed they are all petty charges but add them up and you will see the big picture. Even getting your statement printed on a sheet of paper costs you these days. Sometimes I think the bank has forgotten that it is in business because its customers keep their cash there!

 

Thinking up new fees is the bank’s money-raising strategy which brings in an estimated $12 billion a year. Yep, the banks are having a rough time but that doesn’t mean that you have to pay for it. Bank fees are here to stay, but here’s how to avoid some of them:

 

A study by the Pew Charitable Trusts found that disclosure documents averaged 111 pages long. The Consumer Financial Protection Bureau is being pressed to require banks to publish a one-page disclosure of all fees. But do your best to understand what you’re up against, you can only fight things you know about.

 

A big demand may come with direct deposit. "Often, something as simple as having direct deposit of your paycheck or Social Security payment is enough to get monthly maintenance fees waived." But often you’ve got to ask for the waiver, it won’t be offered automatically.

 

Customers who are likely to be rewarded with waived fees are those with multiple accounts, such as checking, savings, a credit card, mortgage or car loan, in other words, the more business you do with your bank, the more leverage you have in staving off fees.

 

Some banks allow you, at no charge, to get email or text message alerts of balances. This can help you avoid fees for overdrafts and minimum balances. This service generally isn’t offered, however, unless you request it. Some online money management sites also provide such alerts.

 

If you have an interest-earning checking account, you may pay an average of $14 a month in fees unless you keep a balance in the thousands, according to a recent study by Bankrate.com. But on non-interest checking accounts, the monthly fee averages less than $5 a month, waived with a balance of $585. To save on fees, consider a non-interest account.

 

In September the Bank of America announced plans to impose a $5-per-month fee for the privilege of using their debit cards. About 700,000 people moved their accounts to lower-fee credit unions. In November the $5 fee was dropped. So if you’re considering a move this might be the time to politely remind your big bank that it isn’t the only game in town. New customers take note: Some banks now levy fees for closing accounts opened within the previous 90 or 180 days.

 

Online banks such as Ally, ING Direct and EverBank have lower overhead than brick-and-mortar banks, which can mean lower fees. Banking online with your current institution also may help you avoid increasingly common charges for paper statements.