Do you know how banks are able to make billions of dollars per year? While a great deal of money is made from interest on various financial products such as loans and credit cards, banks generate profit from services that they provide to clients. To some clients, bank fees are insignificant, however; for individuals that would like to be better managers of their money, the fees can add up at the end of the year.
Although fees can differ from bank to bank, here are six common fees that you should attempt to avoid paying on a regular basis and tips to use.
1. Using Another Bank’s Machine
Convenience always comes with a price especially when it relates to money. Although you can use your Interac bank card at any automated banking machines for transactions, you should attempt to use machines that belong to your specific bank to avoid paying unnecessary fees. Using alternative machines will result in incurring fees which will add up at the end of month.
Tip: Consider taking a lump sum of money the next time that you are at your respective bank branch. Be sure to withdraw your money on the way home from school or work to prevent theft or impulse buying.
2. Making a number of transactions per month
Having access to your own money is not free. Even if you are face-to-face with a bank representative at your local branch to perform a withdrawal, it will cost you on each visit.
Tip: Limit your visits to the bank. Instead of withdrawing $20 three times a week, take out $80 at the beginning of each month so you will pay for fewer transactions.
3. Using the wrong chequing account
If you have and use a chequing account, find out the fees that are attached to it. Chances are that you are paying fees each time you issue a cheque to another individual or to pay a bill.
Tip: Find a bank that does offer chequing account that does not come with fees. ING Direct has THRiVE Chequing™ an online no-fee daily chequing account.
4. Paying your bills in person
Crazy but true, banks will charge you a fee for paying your bills in person. Considered to be a service, you are asked to pay for an individual to process a payment each time you enter your bank.
Tip: Pay your bills via the internet. Not only will you save money in the long run but you will not have to make a trip to the bank that can be time consuming.
5. Not having a minimum balance
At some banks, you will be charged a fee for not having enough money in your chequing account on a monthly basis. For example, having less than $1500 in a chequing account can lead to paying $3.95 per month or $47.40 per year.
Tip: Find account that fits your needs in terms of the money that you can have in the account on a monthly basis. In addition, consider switching banks that offers low or no fees linked to chequing accounts.
6. Receiving paper statement by mail
If you are still receiving monthly statements from your bank, you are incurring a charge to be just to be kept informed. Banks substantiate this fee because of the costs of printing and mailing the statements.
Tip: By having access to your online banking profile, you can view your credits and debts and print statements for free.
Looking to save money? Why not look at some of the bank fees that you can prevent from paying by simply being informed of the charges that you take for granted and a smarter client.