How to Avoid Banking Fees

An insightful article published here at CreditDad.com last month showed that consumers really do have control over our banking situations. We can:

• Find a new bank to leverage promotional offers and the best deals
• Select multiple banks or credit unions to get the best services at the best prices
• Voice complaints, threatening to switch banks if our requests aren’t accommodated… and making good on those threats when necessary

If all else fails, we can simply wait for a class action lawsuit, such as the recent CapitalOne situation, to collect some reparations and a sense of justice.

But taking action not only helps us feel more powerful against what often seem like Goliath entities, it can promote positive change in the way customers are treated and the fees we pay.

Switching banks can be a huge hassle, though, so unless the service is abysmal or the fees outlandish with no chance of having them waived, your best bet is to use the system to your advantage by knowing the rules.

Outside the Box Thinking to Avoid Fees

Last year when Chase Bank initiated service fees for checking accounts, they offered a list of “exceptions,” which included using your debit card for purchases a number of times per month, having one direct deposit of at least $500 per month, or carrying a monthly minimum balance.

I could not meet the direct deposit requirement, I sometimes dropped below the monthly minimum balance requirement,
and I never use my debit card for purchases because of potential service charges. But as a long-time Chase customer, I wasn’t giving up.

I spoke to several representatives until one found a way to accommodate me. A Chase Premier Platinum checking account is free if you have at least $75,000 worth of money or investments with the bank. Since the bank also holds our mortgage, we were set. What did I learn? Find a banker willing to think outside the box to offer the customer service you demand. Even if you feel something is impossible, (and representatives tell you the same), remain polite but firm. Know what you want, but be willing to walk away if you can’t get it.

Here Are 4 More Tips to Avoid Bank Fees

1. Take advantage of email and SMS notifications

Believe it or not, your bank really doesn’t want to charge you fees. They make money from them, but fees also create unhappy customers. And in today’s highly competitive banking environment, the last thing a bank wants is unhappy customers.

One month, I got charged fees for making too many savings account withdrawals. I called the bank to complain (notice a pattern?) and they refunded the fees. They also recommended I set up notifications to send me an email and text message when I approach the monthly limit for savings withdrawals. With alerts available for low balances, withdrawal limits and even bills due, staying connected is the best way to stay fee-free.

2. Know the rules, and play by them

The number one rule for credit card reward success is to read (and follow) the fine print. It’s the same for avoiding banking fees. If a free checking account requires four debit card payments per month, get them out of the way early in the month or on something you’re guaranteed to do four times monthly (grocery shopping anyone?)

3. Read new policy notifications immediately

Banks must notify customers of changes to their policies, including new fees. But that doesn’t matter if you don’t stay apprised by reading the notifications. Even if it looks like junk mail or spam, if it’s from your bank, open the mail and read the notice. (But don’t click any suspicious-looking links in your email. You can go directly to your bank’s website to read most notices.) At home, read snail mail from your bank carefully before shredding them to reduce paper clutter in your home and the risk of “low-tech” identity theft.

4. Shop around

Don’t like the fees at your bank and don’t want to go through the trouble of avoiding them or fighting against them? Look around for a bank or credit union that fits your lifestyle, with rules you can easily follow without extra effort. For many people, signing up for direct deposit to get free checking is a no-brainer. Others might select a bank that requires a minimum monthly balance. Don’t be afraid to use different banks or credit unions for different services to find the best deal.