I went into the bank the other day to open a new personal checking account. As I am sitting with the banker, we are having a casual conversation about bank fees. When I mentioned the new law that would require them to charge $15.00 per month for debit card transactions, he looked as though he had seen a ghost. He pulled his chair closer to me and in a low voice said “How did you know about that?”. Apparently, he and his fellow bankers were planning to keep that a secret. Well, Sir, I’m cheap and I watch the news so do the math.
What was the point of that story? The point is to let your brokeass know that the bank constantly has their hands in your pocket (hopefully, you knew that already!). This is so much so, that several bankers have admitted to me on different occasions that the reason they can get away with charging exorbitant fees is that customers do not read their statements. Please re-read that last sentence, because it is really important. Yes, they have been charging you up the wazoo and you don’t even know it because you don’t read your statement. Bankers have also said that a small number of people will come into the bank hopping mad over fees that they have been charged but it usually takes them a few months to a few years to figure it out.
Think about it, you probably receive your statement electronically, which comes directly to your smartphone. What do you do when you get that email? If you are like me, you make a mental note that you received your statement and then you delete it. Do you ever really sit down at the computer and go through your statement page by page? Probably not. I don’t even write checks anymore, so I never reconcile my checkbook because I keep it all in my head and thus I have no earthly clue what the bank is charging me. Even if you receive your statement by mail, what do you ? Open it, flip through it quickly then shred it and away it goes.
I was very fortunate in opening my checking account. I was able to score two FREE checking and a savings account because I also have a business account. Not everyone is that fortunate. Aside from actually reading your statement, you need to tally up your annual bank fees. Even if you feel they are reasonable, it doesn’t hurt to shop around and see what other banks are charging if anything at all. If you can’t find a local bank with reasonable rate, try a credit union or internet bank to see if you can save a bit on the fees. Before you jump ship, take a visit to your local bank and throw the deal in their face. I’m not saying tap dance on the bankers desk and point at your rear end because you are leaving, I’m suggesting that you explain to the banker that you have been with them for X amount of years and you are considering going to Y bank because their fees are too high. Often times, your bank will try to give you a deal just to get you to stay.
Another thing that you are probably not paying attention to are those pesky ATM fees. Pay attention to the fees if you must use the ATM. If your bank charges $3.00 and the other bank charges $3.00 and you took out $60.00, you just paid a 10% convenience fee. Kind of silly, isnt’ it! That $6.00 could have bought your brokeass a sandwich instead of going to two banks who already have enough money. Watch the fees, or get your cash when you do a debit card purchase and request cash back which is generally FREE (check with your bank). Another idea, although it is a pain, is just to go into the bank and get cash from the teller.
It may not be possible to avoid bank fees all together, but try to hang on to as much of your money as possible by avoiding pricey ATM fees and banks with high monthly fees. It is also wise to read and hang on to the super boring disclosure paperwork that the bank gives you. Remember they are counting on the fact that you are not reading this stuff. If you educate yourself on how much of your money they are taking you will be much better off!
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