How to avoid high bank charges?

More than a third of the bank's borrowers struggle to pay their debts on time. Added to this debt are the costs of various banking services. To do this, you need to closely monitor your bank accounts to avoid unnecessary charges. In fact, a handful of bank charges could push you into unmanageable debt levels.

Although these bank charges seem small, they can certainly add up over time. Fortunately, it's easy to avoid or reduce these sometimes high fees if you have some knowledge in advance.

I assume that now you are faced with a situation where you pay colossal bank charges to your bank. If so, worry no more. In this article, I show you the most common bank charges and how you can avoid them. This method will save you hundreds of dollars over the years. But before you start, here is some training that will help you earn 1000euros/day on 5euros.com. Let's go

The 8 most famous bank fees

If you regularly see fees deducted from your checking account, know that you are not alone. Me too, a few years ago when I opened my first bank account I had the same problem. According to a study carried out in 2017 by the American Federal Reserve, holders of current accounts in banks pay about 250 $ per year as a fee. However, you should know that you are not obligated to pay them, although they are common fees. Before telling you how to avoid or reduce your banking fees, let's first introduce them.

➤ Monthly maintenance/service fees

Many banks charge you a monthly fee for keeping your money in an account with them. The amount of these maintenance fees depends on your bank, but you can pay up to $15 per month for a non-interest-bearing checking account. All told, you'll pay a total of around $180 per year.

Including monthly maintenance fees in your checking accounts is a way for banks to both directly increase revenue through fees and encourage consumers to keep more money in the bank. But how can you avoid or reduce these maintenance costs?

How to avoid account maintenance fees?

It's usually easy to avoid checking account maintenance fees. Holders of this type of account can open both a checking account and Saving account at the same bank or by maintaining a minimum balance in your account. Sometimes setting up a monthly direct deposit system is enough to waive the monthly maintenance fee.

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In addition, many banks that charge monthly maintenance fees specify that these fees will be waived each month the consumer complies with certain guidelines. These guidelines may include:

• Maintaining a minimum daily balance in the account
• The establishment of a system of recurring direct deposits
• The use of the debit card associated with a minimum of times per month

Knowing these guidelines to benefit from this monthly fee waiver, you can avoid paying account maintenance fees. Additionally, if you regularly qualify to avoid fees, you may be able to call and request a waiver if there is a month where your daily balance slips or you neglect to use your debit card.

➤ ATM fees

If you feel like you're paying more for the convenience of using ATMs outside of your banking network year after year, you're absolutely right. ATM fees from your bank and the ATM operator can add up when you're frequently withdrawing cash. Major brick-and-mortar banks charge in average $2,50 to customers for using an off-network ATM. However, the use of ATMs is optional. It's ultimately up to you to decide whether the convenience of using an ATM is worth it.

I found that over time the ATM fees for my various accounts kept increasing. This may be the case with you too. you should know that this trend is expected to continue because there are certain factors behind this.

It all starts with the rise of peer-to-peer payment applications that have significantly reduced the use of ATMs. This drop in demand for ATMs makes them very expensive to maintain. The increase in ATM user fees therefore offsets the reduction in ATM transaction volume. Moreover, banks see ATM surcharges as a relatively safe way to maintain or increase their profits without alienating their customers. But how do you end fees once and for all?

How to avoid ATM fees?

Like account maintenance fees, ATM fees can be avoided. Besides, the good news is that ATM fees are among the easiest to avoid or reduce. The first thing you need to know is that the use of ATMs is optional, it is up to you to judge the necessity of its use. Next, you need to identify your bank's network ATMs in your area so you always know where to find cash if you need it.

Fortunately, many banks offer ATM locators in their mobile apps. Finally, you can only use ATMs in your bank's network, which can usually be found on their website.

If you need money right away and the only ATM options available will charge you a fee, consider using your debit card for a small purchase and requesting cash back instead. Many stores don't charge cash back fees, making it a nearly free way to access your money. That's all I can tell you for now about limiting your ATM fees.

➤ Bank overdraft fees

Before first these fees, it is important to know what is overdraft. Well, the bank overdraft mainly corresponds to the “authorized overdraft”, the amount and date of which are contractually fixed in the account agreement, which specifies whether or not an authorized overdraft is possible. It is the margin that your bank can grant you when you wish to carry out a transaction for which the amount is greater than what you actually have in your account. From this definition, the overdraft is assimilated to a credit and is therefore not free. It is not a right and must be subject to approval by your bank.

However, overspending your account is the kind of mistake anyone can make. In reality, we all tend to keep our checking account balances in our heads, even though it's easy to forget. You could then make a $50 purchase with your credit card, without realizing that your account only has $35.

In practice, banks often let the purchase go through in this case, rather than refusing the payment. You might be spared the momentary embarrassment of having your payment declined, but your account goes into the red. That's when your bank will charge you the overdraft fee. But how do you avoid it? Here is the solution to your problem.

How to avoid bank overdraft fees?

Overdrafting your bank account is an easy accident to avoid. The first thing to do to avoid overdraft fees is to sign up for a direct deposit system. This solution also allows you to avoid fees related to the use of ATMs. This system will ensure that money is systematically and automatically paid into your account. This will also help you maintain a minimum required balance for your account and avoid overdrafts.

Many banks also offer overdraft covers or protections for an average fee of up to $35 per overdraft. Because instead of being refused for a purchase when you don't have enough money in your bank account, the bank will cover you by withdrawing the funds from your linked savings account, your second checking account, your line of credit , etc.

Since transfers between linked accounts happen instantly, having a savings account that you can transfer money from when you realize your balance is getting low will also help you avoid overdrafts. Finally, the best way to avoid overdraft fees is to keep an eye on your account balance. One easy way to do this is to sign up for balance alerts via email or text message from your bank. You can set these alerts to be notified when your balance drops below a threshold you choose.

➤ Bank statement fees: paper version

The bank statement is a summary of all the financial transactions that took place on an account managed by a bank during a certain period. Before, receiving a monthly statement in the mail was the only way to get details of transactions in one's bank account.

These days, your bank statements are emailed or made available to you on the banking app or website. These services allow you to access all your banking information 24/24. However, some customers still prefer to receive paper statements in their mailbox rather than their email. Unfortunately, some banks charge fees for printing and mailing bank statements to their customers. These fees vary depending on where you bank and how many pages you print.

How do I avoid paper bank statement fees?

To avoid these fees, simply sign up for paperless or online banking. In reality, there is no way to receive paper statements for free, unless your bank charges for one.

➤ Account inactivity fees

Another thing that many account holders don't know is that some accounts incur charges for inactivity. If an account has been inactive for a certain period, the bank can no longer levy any charges on the account.

Not only do these dormant accounts cause administrative headaches for banks, but they can also cost them dearly. Banks levy inactivity fees on these accounts at this time in order to encourage holders to become active again. These fees generally vary between $10 and $20 per month. Banks may start charging inactivity fees after the account has been completely inactive for at least six months. Some banks wait up to a year to start charging these fees.

You may or may not receive notice that the bank will begin charging the monthly fee. If this is not done, you may not realize you are paying the fee until the bank clears the account with that fee and closes the account. $0 balance account. Here's how to avoid these fees.

How to avoid account inactivity fees?

To avoid fees related to the inactivity of YOUR account, two solutions are available to you. Setting up a deposit or recurring payment system can help you keep activity to a minimum. Otherwise, you can just close the account and transfer the money to an account you are more likely to keep track of.

➤ Excessive transaction fees

Excess transaction fees arise when savings account holders withdraw beyond the expected limit. In the USA for example, this limit is six free withdrawals and transfers per month. But, with the coronavirus outbreak currently circulating in 2021, that limit is lifted.

How to avoid excessive transaction fees?

Excessive transaction fees can range from $3 to $25 per transaction, but this can easily be avoided if you use your checking account as your daily account for routine withdrawals, such as paying bills. In any case, you need to know the differences that exist between all these accounts. Check out our article on what kind of bank account can i create to learn more about the different types of accounts.

➤ Bank transfer fees

What you need to know is that a bank transfer is a transfer of money that can be made between two accounts open or not in the same bank. Bank transfers can be a quick way to transfer money without using physical cash. But, you have to pay for this convenience. For this service, banks generally charge between $16 and $35 for domestic and international transfers.

How to avoid bank transfer fees?

To avoid this kind of fee, you must use electronic transfers, but sparingly. This method actually does not allow you to avoid but earlier to reduce. Unless it is an official transaction that requires a large sum of money. Alternatively, you can transfer funds online or through your bank's mobile app.

➤ Costs related to the use of a bank card

Bank card fees differ not only from one card to another, but also from one bank to another for the same choice of card. These fees can be linked to annual contributions, withdrawals, operations outside currency zones, theft of the card or even the reissue of the password. Among these fees, some are free depending on the banks. Remember to consult your bank's pricing conditions to avoid unpleasant surprises!

How to avoid or reduce credit card fees?

Choosing the right bank card is essential, especially as rates vary greatly from one bank to another. Limiting credit card fees is easy provided you take certain points into account! To choose your bank card, you must:

Consider your needs: No need to pay extra credit card fees for services you don't need!

Take into account your banking habits: choose a card corresponding to your habits. There is no point in taking out credit card options such as foreign travel insurance if you never travel outside your home country!

Prefer an online bank: the credit card fees charged by online banks are often much less expensive than those of traditional banks.

Summary …

In this article, I do not claim to be able to help you avoid all bank charges. In fact, bank fees will never disappear completely. You just have the option to avoid the majority of these fees that come your way. Just keep good management habits from your bank account. Keep an eye on your balance and regularly check your account online to avoid billing errors. And, if you feel like you can't avoid your current bank's fees, don't be afraid to find another bank that's right for you.

See our article on Understand the bank to better invest in order to know how to choose a bank that suits you. Go ahead, leave me all your concerns in the comments. Before leaving you, here is a training that teaches you how to sell advice on the internet. Click here to buy it.

Good luck