Avoid checking account fees and save money
Easy tips to reduce checking account fees.
Unplanned fees are frustrating and re-occurring checking account fees can become very expensive and quickly. While not all bank or credit union fees may be avoided, there are certainly things you can do to reduce them. The Consumer Financial Protection Bureau and Michigan State University Extension suggest the following tips to reduce checking account fees:
- Know where the fees are coming from. What transactions are leading to the fees and is there anything that you could do differently to avoid them? Ideas include using your bank or credit union’s ATM instead of a non-participating ATM to avoid fees, or requesting an account alert to help you avoid over-spending.
- Watch your spending. Spending more than you have can lead to expensive fees including bounced check and overdraft fees. Overdraft fees are charged when a person spends or withdraws more money than what they have available in their checking account. A person could receive multiple overdraft fees per day and each fee could range between $30 and $35. Ways to avoid these costly fees include: knowing your balance which can be viewed at the ATM and online, confirming that deposited funds are available before making large payments or withdrawals and receiving low-balance alerts if available (i.e. email or text).
- Monitor your account regularly. Daily account activity can be reviewed online and monthly statements should be reviewed on a regular basis for accuracy. Account errors should be reported to your financial institution immediately. Banks and credit unions are required to inform their clients/members of changes in their accounts, so make sure that you read all mail received from your financial institution.
- Identify, reduce and avoid monthly service charges when possible. Make sure that you understand the requirements of the products you have. Is there a minimum balance requirement, and if so what is it? Are there options to reduce fees such as direct deposit, electronic banking, account consolidation or low-fee checking accounts?
- Be a wise consumer. Compare the fees of your current financial institution (request a list of account fees) and compare those with other banks and credit unions. Other things to consider when comparing banks or credit hours include: hours of operation, locations, access by public transportation, products/services and reputation.