How to Avoid Big Bank Fees on Your Checking Account That Could Add Up

If you’re like most people, you probably hate paying bank fees or extra fees on just about anything – especially when it comes to your checking account. However, there are some tips on how to avoid getting caught up in various extra fees imposed by banks and other financial institutions that could ultimately be extra money in your pocket.

Always Keep a Minimum Balance

Because your checking account is your main account it’s a good idea to always keep something in reserve in case of an emergency. Besides providing you with a cash buffer, keeping a minimum balance may help avoid monthly maintenance fees.  Many banks charge fees for maintaining checking or savings accounts anywhere between $5 to $25 per month. However, some banks often waive their fee if you keep a minimum amount in your account or meet other requirements such as linking checking and savings accounts.

Use Direct Deposit

If your monthly balance is erratic, a possible way to avoid monthly maintenance fees is by using direct deposit. In other words, your paycheck, pension, Social Security, or other regular monthly income is automatically deposited into your checking account. Each bank may have slightly different qualifying criteria. Your bank should offer a similar waiver program for direct deposit, so check it out.

Insufficient Funds

When you make a purchase or other transaction that is more than the amount in your checking or savings account, and you haven’t opted into an overdraft program, the bank may decline the charge or return it unpaid. An insufficient funds or returned-item fee could cost $35 or more. Additionally, the payee may charge you a fee. Try low-balance alerts via phone or email to notify you when your account dips.

Use Outside Sources

There’s another way to have your bank credit you for a direct deposit. Use a PayPal account (or other electronic money transfer service if you have one) to transfer funds. Although your direct deposit is being moved from your PayPal, your bank may see the transferred funds as a direct deposit. This option may or may not work at all banks — it depends on how your bank sees these types of transactions.

Open an Online Account to Avoid ATM fees

Using ATMs that aren’t associated with your bank may bring charges from the ATM provider and your bank. How much? For a single transaction, you could pay as much as $4 to the ATM provider and $4 to your bank. Can you avoid it? Many banks offer Apps that tell you where to find fee-free ATM. Or, you could withdraw cash in advance when you’re near your bank’s ATM.

Use Your Debit Card

Certain banks encourage you use your debit card as much as possible. In fact, some banks advertise if you use your debit card 10 or more times in a month, it will waive monthly maintenance fees. Check with your bank to see if it offers this.

Link Accounts

Typically, your bank will waive your checking account fee if your combined balance from multiple accounts at the same bank exceed a certain amount. This is referred to as a relationship waiver. Qualifying accounts could include money market, CDs, IRAs, brokerage accounts and mortgages. Check with your bank.

Go Paperless

If you’re paying a fee for paper statements each month, you could also be paying extra fees to have them mailed. If you want something in print, try doing it yourself from your online banking statement.

Hopefully with these tips you will be able to avoid additional checking account fees in the near future and instead spend the savings on items you need or want!

Avoid Excess Transactions

Some banks place a cap on the number of monthly withdrawals you can make from certain accounts — usually savings or money market accounts. After a certain number, your bank may charge you anywhere from $3 to $25 per transaction — the amount may increase with additional transactions. So, don’t use your savings account for daily withdrawals and/or bill pays — use a checking account instead.