Advertising
Advertising

7 Essential Ways To Avoid Unnecessary Bank Charges

7 Essential Ways To Avoid Unnecessary Bank Charges

With more than a third of Americans struggling to pay debts, people need to watch their bank accounts closely for unnecessary charges. Even a handful of bank charges could push a person deeper into debt, making it difficult to recover financially. Follow these 7 essential tips to avoid bank charges and keep the money that belongs to you.

1. Understand What Your Bank Can Charge

The government sets regulations that prevent banks from charging outlandish fees. For instance, banks used to charge overdraft fees for each purchase that exceeded the account balance. If you purchased three things in one day, then you could get charged three overdraft fees. The bank would fund the purchase, but at a steep penalty. Today, banks must give customers the option to opt in or out of overdraft protection.

Despite some regulations, banks still get to charge relatively high fees for simple mistakes and services. Always read the fine print before opening an account. If your bank updates its policies, read the new fee structures so you understand exactly what your bank can charge.

Advertising

2. Search for Banks Without Unnecessary Charges

Not all banks try to make money out of every transaction. If you’re tired of paying fees for things like ATM withdrawals and talking to a teller, search for banks that don’t charge for those services. There are plenty of options, including credit unions and online banks.

3. Bundle Services to Avoid Bank Fees

Banks want you to use as many services as possible, so they eliminate certain fees for customers who use bundled services. Someone with a checking account might have to pay a small monthly fee. Adding a savings account could lower or eliminate that fee.

Talk to your bank about how bundled services could help you avoid unnecessary fees. If you’re not satisfied with the response, start exploring alternatives with better, cheaper services.

Advertising

4. Avoid Overdraft Fees by Keeping Enough Money in Your Accounts

Banks usually charge overdraft fees when you spend more money than you have in your account. Keeping a close eye on your checking and saving balances will help you avoid overdraft fees that can cost up to $37.

Banks often charge fees for continuous transfers, so you may want to consider using a money transfer service, like Ria Money Transfer, to avoid these charges. Doing so could help you avoid numerous fees and potentially overdrafting your bank account.

5. Use Online Banking to Avoid Paper Statement Fees

Now that most banks offer online services, members may have to pay extra for paper statements. As long as you have a computer and Internet connection, you can avoid those paper statement fees.

Advertising

Most banks will let you choose whether you want paper or electronic statements. Ask if you have to pay for paper statements. If you do, consider opting out of that service. You’ll spend less money printing your online statements than having the bank send you paper versions in the mail.

6. Choose an Account With Fewer Charges

Even at the same bank, members may pay different amounts for similar services. You can save money by choosing an option that matches the way you prefer using your account. For instance, if you prefer going inside the bank to talk to a teller, you may have to pay a fee unless your account covers the service. Other accounts may charge for using ATMs.

Find an account that will charge you less for the services you plan to use.

Advertising

7. Ask the Bank to Waive Fees

Banks want to make extra money by charging fees, but they don’t want to lose long-term customers over piddling amounts. If you receive a charge that you think is unfair, contact the bank to ask about waiving the fee. Many banks will remove the charge from your account to keep your business.

Some research shows that 44 percent of people have convinced their banks to forgive fees. You’re more likely to get a refund by talking to service reps nicely and moving up the chain of command until you find someone authorized to remove the fee.

Since banks want to keep their best customers, long-term members without previous charges may have more success.

Featured photo credit: Image vis Flickr by SimpleIllustration via flickr.com

More by this author

6 Simple Foods with Amazing Health Benefits 6 Things to Consider Before Installing a Tankless Water Heater 3 Reasons Why You Should Be Zone Heating Your Home geothermal heat pump 3 Reasons to Install a Geothermal Heat Pump dog The 7 Best Pet Products for Apartment Dwellers

Trending in Money

1 How to Use Credit Cards While Staying Out of Debt 2 How to Use Debt Snowball to Get out from a Financial Avalanche 3 How Personal Finance Software Helps You Get More Out of Your Money 4 The Best Ways to Save Money Even Impulsive Spenders Can Get Behind 5 How to Answer the Tough Question: What are Your Salary Requirements?

Read Next

Advertising
Advertising
Advertising

Last Updated on March 4, 2019

How to Use Credit Cards While Staying Out of Debt

How to Use Credit Cards While Staying Out of Debt

Many people will suggest that the best thing to do with your credit cards during these tough economic times is to cut them up with a pair of scissors. Indeed, if you are already in huge debt, you probably should stop using them and begin a payback strategy immediately. However, if you are not currently in trouble with your credit cards, there are wise ways to use them.

I happen to really love my credit cards so I will share with you my approach to how I use mine without getting into deep financial trouble.

Ever since about 1983 when I got my first Visa card, I continue to charge as many of my purchases as possible on credit. Everything from gas, groceries and monthly payments for services like my cable and home security monitoring are charged on credit. Despite my heavy usage, I have maintained the joy of never paying any interest fees at all on any of my credit cards.

Advertising

Here are some tips on how best to use your credit cards without falling into the trap of paying those nasty double-digit interest fees.

Do Not Treat Credit Cards as Your Funding Sources

Too many people treat their credit cards as funding sources for major purchases. Do not do this if you want to stay out of trouble. I use my credit cards as convenient financial instruments so I do not have to carry around much cash. In fact, I hate carrying cash, especially coins. When you buy things on credit, the purchases are clean and you will not get annoying coins back as change.

I do not rely on my Visa, MasterCard or American Express to fund any of my purchases, large or small. This brings me to my golden rule when it comes to whether I will pull out any of my credit cards either at a retail or online store.

Advertising

I never purchase anything with my credit cards if I do not have the actual cash on hand in my bank account.

If I really cannot pay for the item or service with cash that I already have at the bank, then I simply will not make the purchase. Remember, my credit cards are not used as funding sources. They are just convenient alternatives to actual cash in my pocket.

Make Sure to Always Pay Off Balances in Full Each Month

The next very important part of my overall strategy is to make absolutely sure that I pay the balances in full each and every month no matter how large they are. This should never be a problem if the cash has been budgeted for my purchases and secured in the bank. I have always paid my full balances each month ever since my very first credit card and this is why I never pay interest charges.

Advertising

Using Credit Cards with Rewards

Most of my credit cards are of the “no annual fees” type, including one MasterCard on a separate account I keep at home as a spare in case I lose my wallet or incur any fraudulent charges. However, I do use a main Visa card which does have an annual fee because all purchases on that card reward me with airline frequent flyer points. For me, the annual fee is worth it since I do travel and I get enough points to redeem many free flights.

You have to decide for yourself if you will charge enough purchases on credit each year without paying interest charges to warrant a credit card that rewards you with airline points (or other rewards). In my case, the answer is “yes” but that might not be the case for you.

I occasionally use a MasterCard or American Express card on small purchases just to keep those accounts active. Also, I have been to the odd retailer that accepted only a certain type of credit card, so I find that having one from each major company is quite handy. Aside from my main Visa card which earns the airline points, the rest of my cards are of the “no annual fees” variety.

Advertising

So this is how I use my credit cards without getting into any financial trouble with them. This strategy is recommended only if you are not in debt, of course. In fact, it is worth keeping in mind once you’re out of debt so that you can keep your credit cards active and treat them responsibly.

What are your credit card usage strategies? Let me know in the comments — I’d love to hear what methods you use.

Featured photo credit: Artem Bali via unsplash.com

Read Next