Whether your banking is for your business or for your personal life, chances are that bank fees are costing you more and more and more. However, it’s surprisingly easy for you to control and reduce many common bank fees. Consider these five tips:
- 1. Consolidate
Having all of your accounts with the same bank greatly improves your chance to qualify for certain services at a reduced fee or at no charge. For example, you can reduce overdraft fees by linking your checking account with your savings account, credit card account, line of credit, or another checking account.
- 2. Negotiate
Banks want assets, so they may be willing to use the combined total of your accounts as the basis for the fees you are charged.
And if you are getting a new loan or refinancing an existing one – such as a mortgage, a car loan, or a small business loan – negotiate with your loan officer to receive certain services such as a checking account for free or at a greatly reduced rate.
- 3. Anticipate
Typically, banks waive the fees on certain checking or savings account if you maintain a minimum balance. But beware that a fee will be charged if you drop below this minimum.
Some banks offer a free “low balance alert” service or you can investigate an app to add on designated accounts.
Another fee you can reduce by planning ahead is the one for using your ATM card. For example, some banks offer an app that tells you where to find fee-free ATMs so you can withdraw your money free of charge anywhere, anytime. Other banks will even credit your account for any fee from another bank.
The message: shop around!
- 4. Investigate
Bank websites and promotional materials typically highlight the fees that are NOT charged; it can be harder to identify the fees that ARE charged. Ask for the “Schedule of Fees and Charges” -- every bank and credit union is required to provide it to you.
Also, banks are required to advise you about any changes in their fees – so carefully read all e-mails, letters, and monthly account statements you receive from your bank. This can help you avoid the unpleasant surprise of a new or increased fee.
Yet another suggestion: some banks, especially smaller community banks, will analyze the kind of banking you do and at no cost will prepare a customized banking plan for your business or for your personal banking. Together with your bank, you can then select the right accounts and the right services for you – at the lowest possible fees or maybe with no monthly fees at all.
- 5. Switch
Fees at community banks and credit unions are typically low or non-existent for many basic services – and several types of checking accounts offered by these providers may even pay you interest.
Many people think it’s too much trouble and it takes too much time to switch banks – and some banks are counting on this apathy to hold onto you as a customer.
However, smaller banks are both fee-friendly and customer-friendly. The staff will help to facilitate and to expedite your account changes, including those involved with automatic deposits and payments.
So if bank fees are costing you an arm and a leg, remember that you are the customer and have ultimate control over your destiny – and your finances. Ask questions, know your options, then decide which institution serves your needs most effectively and most economically.
Navin Shah is Chairman of Royal Hotel Investments, which owns and operates two hotels in Covington and one in Conyers. He is also Vice Chairman of Embassy National Bank, a community bank in Lawrenceville that he helped establish in 2007 and has become one of the leading SBA lenders in the southeast.