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Avoid Bank Fees: 9 Banking Tips Your Banker Won't Tell You

September 21, 2010

By Miranda Marquit | Money Rates Columnist

When you go into a bank, the truth is that you are probably on your own when it comes to your own financial interests. Everyone may be friendly and eager to help when you walk in the door, but the bank is a business, and it exists to make a profit. That means that your bank wants to make money off of you. Helping you with your finances may not be high on your banker's to-do list. Here are nine things your banker probably won't tell you:

1. Your whole deposit isn't available immediately

This information is somewhere in your account materials, but your banker isn't going to actually tell you this when you make your deposit. Some banks only allow you access to the first $50 or $100 of your deposit. So, if you make a $500 deposit, $400 of it may not be available until the next business day - or later. That means that you can still bounce checks or overdraw your account (and the bank can collect the fee), even though you made your deposit. Ask your banker when the full deposit will become available, since he or she is unlikely to volunteer the information.

2. A post-date on a check means nothing

If you are giving out a post-dated check, you have to trust the recipient not to cash it ahead of schedule, because the bank is likely to just run it through when it arrives without looking at the date on it. Even if the teller looks at the date, a bank has no legal obligation to honor the date on the post-dated check. The bank will accept the check and it could bounce.

3. Fees are the big money maker

Your banker probably won't tell you that fees are the biggest money maker for banks. The interest earned on loans - and even on credit cards - pales in comparison to the fees that banks charge. In 2009, it was estimated that banks made more than $38 billion in overdraft fees alone, according to a study by Moebs Services. Add in other fees, such as the smaller fees charged at ATMs, for paper statements, and for not maintaining minimum balances, and that number is even bigger. The fees you pay are more valuable to banks than just about anything else that you do.

4. You can get some fees waived - just ask

Some banks have a policy of waiving one or two fees each year - just because you asked. You can have a single overdraft fee waived at your request, or ask for refunds on ATM fees. While these policies exist, many bankers aren't forthcoming about them. Banks make more if you just pay the fees, fuming in silence. Ask if there is a policy to waive at least a fee or two at your bank.

5. Your refusal to opt in for "overdraft protection" doesn't apply to checks

Recently, rules regulating "standard overdraft practices" went into effect for checking accounts. Now, before banks can approve transactions that you do not have sufficient funds for, you have to opt in. If you choose not to opt in, your debit card transaction will be denied if you don't have enough money in your account. However, what the bank may not tell you is that checks you write, and automatic bill payments you have scheduled are not included in the new rules. Banks can still approve checks and bills over the amount you have in your account - and charge you a fee for the overdraft.

6. Your online account information may not be accurate

You might be interested in checking your online account information to find out where you stand. However, your information may not be up to date. Sometimes, there are inaccuracies in your online account information, or it doesn't take account for the way that transactions are actually processed. While your online account can be a good guide, it is not always exactly accurate, and if you are cutting things close, you may find yourself in trouble if you rely on your online account information.

7. Bankers are salespeople

Your banker may tell you that he or she is offering a great product or service, but this might not be the best financial decision for you. Indeed, bankers are salespeople, as well as bankers. The more products they can get you to  "buy," the more money the bank makes. Many banks now offer insurance, retirement accounts and more services beyond checking and savings accounts and loans. Be wary when the bank pitches you on a product or service. It might be more about the bank's bottom line than your bottom line.

8. You should shop around for financial products and services

Many people just go to their bank for loans and other products. It seems easier and more convenient to keep their financial accounts at one institution. Additionally, many assume that, because they have been loyal customers, they will get a good deal. Unfortunately, this is not always the case. In fact, your bank may not have the best interest rate on a home equity loan, or your bank's retirement plan may charge higher fees. While you want to include your bank in the search, it's best to shop around for the best deal. Make sure your banker knows when you find a better deal elsewhere. Your bank should be competing for your business, not just assuming that they should have it.

9. The system is likely to decide on your loan application

One of the assumptions that people make is that they are getting a personal decision when they talk with a banker in person. The perception is that the banker can make decisions locally. However, if the bank is branch of a national bank, it is far more likely that the system will make the decision. A banker may talk to you about your options, but ultimately your information is fed into a computer system and reduced to a number. Which means the system is deciding. Unless you are banking at a smaller, community bank, and talking to the owner or manager, chances are an impersonal system will make the ultimate decision about your loan.

Your responses to ‘Avoid Bank Fees: 9 Banking Tips Your Banker Won't Tell You’

Showing 4 comments | Add your comment
Rene

12 October 2011 at 8:28 pm

Regarding tip no.1 I disagree with this because every time you make a deposit you get a receipt with the information of the amount to be held and the date when the funds will be available.

Thomas

12 October 2011 at 6:32 pm

My bank manager was my neighbor, and she told me a GREAT way to avoid ATM fees if you can't get to one your bank owns. Go to Wal-Mart or another store that gives cash back with purchases, buy a cheap pack of gum, and get the cash back you need. It only cost you what you paid for the gum, and you get to eat it.

anonymous

7 October 2011 at 8:09 am

we have another bank that more charge for customers $8.95 per month on your account automatic without noticed. Is this right for Us ? charging without noticed this kind of bank ( US BANK )

Dan Weston

24 May 2011 at 5:10 pm

Very useful and actionable tips. For instance, I decided to start asking for fees to be waived for some transactions like overdrafts and money orders. On a couple of occasions, by asking politely, the branch manager on duty decided to waive them. As a result, I'm now a more loyal client and I get away with more :). I will say that I've had my savings and checking accounts with that bank for years. It's probably good of the branch manager to make some exceptions for me to not lose me as a client just to make a few extra dollars.

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