Ignoring Bank Fees Can Quietly Drain $333 a Year From Your Checking Account
A single bank fee is an inconvenience, but they all add up and can quietly make it more difficult to budget for monthly expenses.
Some people can end up losing more than $300 per year from these fees. These are some of the most common fees to monitor as you use your bank accounts.
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Monthly Maintenance Fees
Many checking accounts still charge a monthly fee if you miss the balance or direct deposit requirements. While some accounts charge less than $10 per month for missing these benchmarks, you can end up with $15 to $16 in monthly maintenance fees with other accounts. The average monthly maintenance fee is $13.95, which comes to $167.40 per year, per MoneyRates. You should check your bank's fee schedule to see the maintenance fee and how to avoid it.
Overdraft and NSF Fees
You don't have to overdraft often for this expense to add up. According to the Consumer Financial Protection Bureau (CFPB), the average overdraft is $35 per month and incurring two of these fees per year adds up to $70. Per Investopedia, non-sufficient funds fees (NSF) only come to $34 apiece on average, but they vary for each financial institution.
Out-of-Network ATM Fees
If you frequently use an ATM for financial transactions, you must stick to ATMs in your network to maximize your savings. The average out-of-network ATM withdrawal results in a $4.77 fee, according to SoFi. If you use out-of-network ATMs 20 times per year, which is less than two times per month, you end up paying $95.40 in annual costs.
The Total Annual Drain
All of the small fees add up, especially if you incur them throughout the year. In this example, $167.40 in maintenance fees, $70 in overdraft fees and $95.40 in out-of-network ATM fees come to $332.80.
Luckily, most of these fees are avoidable through money management. Trimming your expenses and selling some unused items in your home can ensure that you do not have to pay a monthly maintenance fee. You can also switch to a different bank account that has zero monthly service fees or more generous requirements for waiving the fee.
Addressing this issue makes it much easier to avoid overdraft fees, since you typically need a positive balance to avoid monthly maintenance fees. Solving one financial problem often solves smaller issues that were hidden beneath the surface. Using a debit or credit card can go a long way in minimizing ATM withdrawals, but sticking with in-network options can help you avoid unnecessary fees.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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