Your banking expenditures are increasing everyday. You need to cut banking costs.
While most people use a bank account to save money, some of your hard earned money is usually taken by the bank in the form of monthly fee or maintenance charges.
Here is some advice and tips on reducing the fees you are paying to the bank.
Cutting Banking Fees
Even if you have an account with no fees, you often need to always be sure to keep deposited a certain amount in your bank account. If you do this, then often you miss out on earning interest in higher yielding accounts. The best solution to curtail this is by using a bank which offers free checking and combining a savings account with a checking account. If you then keep only as much money as required for immediate payment of bills in your checking account, you can keep more money in your higher interest paying savings account.
Use an Average Daily Balance Account
You need to watch your habits related to your banking transactions. Free checking will not help you at all if your balance goes down below its minimum limit, and you have to pay high fees. If you keep enough in an interest bearing account, then you are advised to keep it in a bank that uses the average daily balance method. This method is used for calculating minimum balance and interest. In this situation, you are not charged for any type of fee, in case your balance goes below the minimum limit for only a short period of time.
The differences in fees related to different banks are apparent when you borrow money. You generally borrow money from a bank for purchasing a car and real estate. You may find that some banks are charging too high interest rate as compared to others, and save money by shopping around, rather than using your current bank.
Avoid ATM Fees
Always use only those ATMs which don’t charge any type of transaction fee. Suppose you withdraw $100 and the ATM charged $0.5 for the transaction, than effectively you pay 0.5 per cent as surcharge on withdrawing your own money.
Balance your Checkbook
You also have to pay some money as a penalty if your checks bounce. Always balance your checkbook since you may incur a fine of at least $25 for a single bounced check. If you issue four checks at a time, than also you may loose $100.
Use Free Online Banking
Many banks charge for their online banking and you may be paying as much as $7 to $8 per month for online banking. They also may charge an additional amount up to $6 for the payment of each bill. However, many banks now offer free online banking to avoid these fees.
You should always keep in mind that it is much easier to save money as compared to making money. You need to work hard to make money. If any banking system is eating into your earned money, than take the money away from that institution. Always keep yourself well informed about how much you are paying in fees and other transaction costs.
For teaching about banking please see:
Teaching Banking and Savings Accounts
Teach and learn about bank savings accounts, banks, and interest rates.