Banks these days have forgotten that when you deposit money, they are borrowing your money and using it to make themselves rich. They have convinced themselves, and most of the population, that they are providing so many irreplaceable services that they deserve to chip away at deposited money, bit by bit, through fees that sometimes border on ridiculous. How can you keep your money where it belongs, and avoid those fees?
Read the Fine Print
Know the details of your account – inside and out. If it costs two dollars to take money out of an ATM that isn’t run by your bank, don’t do it unless it’s an absolute emergency. If your account allows 20 debit transactions a month and then starts charging 25 cents per, keep a notebook in your purse or pocket and keep track of those debit transactions! Other tricky conditions may include keeping a certain amount in your account at all times or fees are charged, or charging fees for transferring funds from a chequing to a savings account.
Having an expense plan so that you know how much money you’re spending weekly or monthly isn’t just good for curbing overspending – it can also help you avoid bank fees. If you’re charged a fee to withdraw cash, don’t pay that fee every time you need $20 – pay the fee once to take out $200 at the beginning of the week. Try setting up direct deposit for your salary or pay your bills automatically out of your bank account to reduce your transactions and fees.
Know Your Rights
When a contract is signed, it cannot be breeched by either party. This can apply to signing up for services – like a bank account with certain terms and fees. Once you have signed up for an account, there is a good chance that your bank is not legally allowed to introduce new fees that weren’t in your original account agreement as long as you are using that same account. Keep a copy of what you agreed to when you signed up for your account – even twenty years later, you might still be able to have a no-fee account (like the ones that used to be the norm) just because you have kept the same account the whole time. With that in mind, be wary when you bank tries to get you to “upgrade” or switch to their “new xyz” account because it “meets your needs better.” Really, it might just be meeting their need for fees.
Don’t like your banks’ fees? Try another bank! With the advent of bank accounts that sound more like “plans” than accounts is an upside: competition. Different banks have different fees, and some have fewer fees than others. If you can never remember how many times you’ve used your debit card in a month, you may be able to find an account where you pay a flat rate of a few dollars a month for unlimited debit rather than having a maximum amount of debit transactions or paying a fee per transaction.
Banks will negotiate. Set up a meeting with a manager and explain that you require an account with fewer fees, or you’ll be looking for another bank. If you’ve already shopped around, you’ll have enough ammunition to prove that you’re serious. Many banks have specialty accounts with lower or no fees for students or new immigrants, and you may be able to wrangle yourself one of those even if you don’t fit the demographic. Don’t settle for what is printed on brochures – bank managers can always do better than that.
Thinking ahead and planning can help you avoid bank fees and keep your money where it belongs – in your account!