Generally, people open bank accounts in order to manage their money and build savings. However, bank fees make realizing these goals more challenging. According to Statista, Americans pay an amount of $7.69 per month in fees just for ATM, overdraft, and other monthly service costs. Add in fees for optional services, and the money that you have worked hard to earn will starts to dwindle.
As a solution to this issue, some people switch to a bank that has low or no fees. Nevertheless, a 2019 study by J.D. Power found that 96% of bank customers keep their money put it in the first place, and do not change the bank. In case you are one of these people, you can minimize some of your bank fees, and you might avoid others completely.
Legal Process Fee
You can take charge of your legal process fees when a legal order directs your financial institution to freeze, attach or withhold funds, or other property. Be prepared for this kind of fees if you are subject to a legal attachment, levy, or garnishment of some kind. For example, the bank of America’s legal process fee is currently $125 per occurrence. Wells Fargo’s legal process fee is around $125, and it will assess it up to two times per month for each account.
Account Research Fee
It can cost you some fee when you ask your financial institution to research an old transaction, such as who cashed a certain check or when it was paid out. Reno Frazzitta who is an owner of Smart Money Financial Advisors in Sterling Heights, Michigan said, “Not all banks charge for this.” Conversely, Ally Bank and Wells Fargo list around $25-per-hour as a fee on their websites for account research services. So, be sure to ask your bank or credit union if your request will be charged with a fee.
Monthly Maintenance Fee
Also known as a minimum balance fee, a monthly maintenance or service fee is usually charged to keep the account active, and it can differ from a bank to another. However, the bank will waive the fee in case you meet certain requirements, such as maintaining a minimum balance or receiving a qualifying number of direct deposits each month.
Although many traditional banks charge a monthly maintenance fee on their standard accounts, many online banks like Ally Bank does not charge monthly maintenance fees for checking and no minimum deposit to open an account is required.
Overdraft Fee
In case you overdraw your account by using your debit card, you will be charged an overdraft service if you have chosen the bank’s overdraft service, which allows transactions to take place even if your account balance doesn’t cover them. These transactions will be declined if you cancel the service in question, and so you will be able to save the overdraft fee.
Overdraft fees differ from one financial institution to another. While some banks and credit unions might charge every overdraft transaction you make a day, they also might waive or reduce these fees in case you are a loyal customer.
Non-Sufficient Funds Fee
Also known as returned items, the NFS fee applies to bounced checks. According to Statista, this fee averaged over $33 per occurrence in 2019. Besides, Frazzita said, “this fee can accumulate quickly if you write several checks against a deposit that you recently made and that deposit ends up bouncing.” In this case, the best thing you can do in order to avoid this kind of fee is to wait for a few days for your deposit to clear before writing any checks against them.
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Overdraft Protection Transfer Fee
Overdraft protection refers to an optional service that automatically transfers money from a linked savings account, credit card, or line of credit to prevent overdrafts.
Usually, the overdraft protection transfer fee is around 12$ for each transfer. However, some banks do not charge fees for an overdraft in case the overdraft is covered with one of that bank’s credit cards or a linked account.
Returned Item Fee
You can be charged a returned item fee when you deposit a check that bounces. If the person who wrote you the check does not have enough funds in their account, your bank will assess this fee against you. Typically, returned item fees are the same as fees for non-sufficient funds.
Stop Payment Fee
You can be charged a fee when you ask your bank to stop payment on a check that you no longer want to be paid out. You have to ask for this service before the check-in question hits your account. Although not all accounts are subject to this fee, in case your account is charged with this fee, you can expect to pay around $30.
Check Ordering Fee
If you request new checks from your bank, you will likely have to pay for them. However, you can save money on the purchase by ordering through a retailer such as Walmart or Costco rather than your bank.
If you want to use as few checks as possible, consider making online purchases as many as possible. In addition, use credit cards instead of checks when paying for groceries or other expenses. However, if you use a credit card, you should pay it off before you incur interest rate charges to make this choice effective in terms of the cost.
ATM or Debit Card Replacement Fee
In case you lose your ATM or debit card, you might be charged for the card replacement. For example, Bank of America does not charge a fee to replace an expired debit card but does charge an amount of $5 for card replacement upon request. In case you are in hurry to replace the card, the bank might charge you a fee of $15. Frazzita said, “Sometimes, an estimated fee of up to $25 may apply when you ask for rush delivery of a debit card or other debit access device.”