Bank fees are payments that banks extract from customer accounts in exchange for services such as transaction fees, currency exchange, running an account, assessing a loan, issuing a credit card, etc.
They could either be the regular maintenance or servicing charges, or ATM service charges when used outside of the network, or hefty transaction charges, or bank overdraft charges.
Bank charges can be a nuisance, but there are several ways you can avoid them. This is the purpose of this article. You will discover all you need to know about avoiding bank charges.
Five smart strategies to avoid bank charges
Here are five smart strategies you can adopt to avoid or reduce bank charges:
Use a bank account with no monthly fees:
There are so many banks offer accounts with no monthly fees if you meet certain requirements, such as maintaining a minimum balance or setting up direct deposit. If you don’t meet these requirements, you may be able to negotiate with the bank to waive the fee.
Choose a credit union instead of a bank:
Credit unions are non-profit financial institutions that are owned by their members. They often offer lower fees and better rates on loans and accounts compared to banks.
Use ATMs wisely:
Many banks charge fees for using out-of-network ATMs, and those fees can add up quickly. To avoid these fees, try to use ATMs that are in your bank’s network or are part of a network that your bank belongs to. Alternatively, you can consider opening an account with a bank that reimburses ATM fees, such as Lenco.
Be mindful of overdraft fees:
Overdraft fees occur when you spend more money than you have in your account. To avoid overdraft fees, be sure to keep track of your account balance and set up overdraft protection, which can be linked to a savings account or credit card. Some banks also offer alerts that can notify you when your account balance is low.
Shop around for the best account for you:
Not all bank accounts are created equal, and it’s worth taking the time to shop around and compare options. Consider factors such as fees, interest rates, and account features to find the best fit for your needs. It’s also a good idea to read the fine print and understand the terms and conditions of any account you’re considering.
Lenco is a fin-tech, and digital only bank that issues easy to open and free to operate current bank accounts for Startups and SMEs without any hassle. It is cheaper to operate because they offer cashbacks on each transaction fees at the end of the month.
Other steps to take to avoid bank charges
In addition to these strategies, there are a few other steps you can take to avoid bank charges:
- Avoid using checks: Many banks charge fees for using checks, especially if you exceed a certain number of checks per month. To avoid these fees, try to use electronic payment methods whenever possible, such as online bill pay or electronic transfer.
- Don’t use your debit card for small purchases: Many banks charge fees for using your debit card for small purchases, such as a cup of coffee. To avoid these fees, consider using cash or a credit card for small purchases.
- Be mindful of international transaction fees: If you frequently travel abroad or make purchases in foreign currency, you may be subject to international transaction fees. To avoid these fees, consider using a credit card that doesn’t charge foreign transaction fees, such as the Capital One Venture or the Chase Sapphire Preferred.
By following these strategies, you can avoid unnecessary bank charges and save money in the long run. While it may take some extra effort to shop around and compare options, it can be well worth it to find an account that fits your needs and helps you save money.