Bank Fees - and how to avoid them

I suppose the prospect of bank fees makes some people avoid banks. Don't let that scare you off.

Most of the common transactions at a bank don't have a fee, and almost all fees can be avoided with a little care and planning.

Fees are usually associated with uncommon transactions and carelessness, so for those of us focused on frugal living, there is really nothing much to be concerned about.

Let's take a look.

My experience shows that fees become a problem only for the irresponsible among us. You know, those that live on the edge and don't pay close attention to their finances. This kind of behavior can result in fees from the bank.

Those who practice individual responsibility don't seem to have problems with bank fees.

Let's look at bank fees and see what this is all about.

Here are typical fees that you might encounter with your personal accounts at a bank:

• cashier's check $3
• bounced check $25 to $40
• low balance $5 to $8 a month
• safety deposit box $25 to $200 a year
• use of debit or ATM card out of network $2 to $3
• cash advance from credit card 1% to 3% of cash advance, plus a transaction fee of perhaps $3

So, how many of these fees are avoidable? Just about all of them. Let's take a look.

• Cashier's check $3 charge only applies if you need a cashier's check for a transaction. Some banks allow one or two cashier's checks without charge each month with certain accounts and minimum balances, so this charge is avoidable.

• Bounced check $25 to $40 charge is avoidable if you don't bounce checks. Stay within your means and avoid the fees.

• Low balance $5 to $8 a month charge is avoidable if you keep your balance at or above the minimum.

• Safety deposit box $25 to $200 a year charge is avoidable if you have your own safe at home. They are relatively cheap to acquire and much more convenient than going to the bank to access jewelry and important papers.

• Use of debit or ATM card out of network will cost you $2 to $3 for each transaction, but this can be avoided by having a credit card and a little cash on hand.

• Cash advance from credit cards costs 1% to 3% of cash advance, plus a transaction fee of perhaps $3. This is all avoidable if you remember to bring a little cash along to supplement your credit and debit card.

And, when you have sufficient funds, it won't cost you any of those funds that you have in sufficient supply, despite the fact that you could comfortably part with some of it?

Learn how to keep an eye on your balance, and you'll avoid paying banking fees. The whole idea of using a bank is to keep your money safe, provide for secure transactions, and perhaps give your money a chance to grow a bit.

Frugal living means avoiding unnecessary costs. When it comes to banking, it's easy to do. Keep you eye on the ball, and you'll avoid unnecessary bank fees.

Done with Bank Fees, take me back to Managing Money