How to Avoid Bank Fees

By Melanie Lockert
January 12, 2018

When you open a bank account, you’re taking a positive first step to managing your money. A bank can safely house your hard-earned cash, help you save money, and more. But, beware: a bank can also cost you money.

That’s right. You may not realize or even notice, but banks can tack on fees for a variety of things. For example, some financial institutions charge a monthly maintenance fee if your balance isn’t at a certain level, effectively punishing you for not having enough money in your account. Talk about adding salt on the wound. And if you overdraw on your account, you may be hit with an overdraft fee, too.

While these fees may not seem like a lot, they can add up. Monthly maintenance fees can be $12 per month and overdraft fees are around $35. Good banks, on the other hand, won’t nickel and dime you with fees. If you want to avoid paying bank fees, here 3 steps you can take.

1. Find out what fees you’re paying

The first thing you want to do is actually know what fees you’re paying for. But don’t fret, this process won’t be time-consuming or require you to comb through all your accounts. Using, you can easily see just how much you’re paying in monthly maintenance fees, overdraft fees, and more.

Your findings may shock you. According to the Bank Fee Finder 2017 Summary Report, Americans on average pay a whopping $329 per year in bank fees. So, find out what fees you’re paying for, as this way you’ll know where your money is going.

2. Read the terms and conditions

You may have seen an unexpected monthly maintenance fee as you scrolled through your checking account. Perhaps you thought: “What is this?!” Banks may tack on fees and require you to meet certain minimums in order to waive those charges.

If you want to avoid bank fees, you can start by reading the fine print on your accounts. Is there a monthly maintenance fee and if so, what conditions do you need to meet in order to avoid paying it? Are there overdraft fees and if so, how much are they?

The first step is knowing what bank fees you can be hit with. Once you know what the fees are, make sure you have a clear understanding of what conditions can trigger these fees. Then, aim to meet the conditions and requirements so that you don’t end up paying fees.

3. Switch to banks with no fees

What if you’re just sick of bank fees altogether? You’re tired of trying to play a game with your money and keep certain minimums or meet requirements to avoid fees. If this sounds like you, it may be time to switch financial institutions and use banks with no fees.

Many big banks charge overdraft fees, monthly maintenance fees and more. If you want to avoid bank fees, you should consider looking for banks with free checking or consider an online bank account or credit union. Many online bank accounts like Chime, as well as credit unions, have no overdraft fees or monthly maintenance fees. Online banks, for example, don’t carry hefty overhead costs as they don’t have brick-and-mortar locations. They pass along these savings to you in the form of no fees. This means you can keep more of your hard-earned dough.

If you’re ready to ditch fees for good, you can open a bank account online. There are plenty of good banks out there, so make sure you find one that fits your needs. For example, perhaps you want to make sure there are ATMs in your area and that you’re getting a free checking account. And, remember: read the fine print and make sure you won’t be hit with overdraft fees or monthly maintenance fees.

By making the switch to an online bank or credit union, you can put money back into your pocket and avoid annoying, unnecessary bank fees.

Bottom line

Bank fees may seem like they’re a fact of life, but they’re not. The key is to be aware of fees in the first place and take action so you can avoid them. Lastly, stay on the look-out for banks with no fees and this way you’ll never have to worry about an unexpected fee again.

Melanie Lockert is the founder of the blog and author of the book, Dear Debt. Her work has appeared on Business Insider, Time, Huffington Post and more. She is also the co-founder of the Lola Retreat, which helps bold women face their fears, own their dreams and figure out a plan to be in control of their finances.

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