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5 ways to save money with your checking account

| Money Rates Columnist.
min read

Banks are looking for ways to recoup revenue lost in the process of meeting new federal regulations, such as new rules on overdraft fees, but that doesn't mean you have to get stuck with paying for a checking account.

Here are five ways to save money:

1. Look for free checking account alternatives

If your bank starts charging a monthly maintenance fee - or you've been paying one - check if a less expensive alternative exists. You might find that your own bank offers a cheaper account that still meets your needs. Bank of America customers, for instance, who do all their banking online or through ATMs get free checking with an ebanking account as long as they don't use the teller service, which costs $8.95 a month.

2.Make sure you meet free checking account requirements

Your bank might add requirements for you to keep free checking, such as raising your minimum balance level, using direct deposit and automatic bill pay or getting paperless statements. If these changes are easy to make, why not meet the requirements? If the restrictions are too difficult to meet, shop around for a checking account with less stringent requirements.

3. Take advantage of free checking account services that help you manage your account

Your bank probably adds a number of free services that can help you keep track of your account, such as transaction alert services that send you an e-mail or text whenever your checking account balance is low. Others include text banking, which lets you send a short text message and get a balance total within seconds. If you have a smart phone, a variety of cell phone apps can make banking easier as well.

4. Set up cheap overdraft coverage if you're at risk of overdrawing your checking account

You have three alternatives for covering overdrafts: opting in for your bank's debit card overdraft protection service, linking your checking account to your savings account, or linking your checking account to a line of credit.

Not all banks offer all three options, and fees for each vary among banks. However taking the time to explore your overdraft options is well worth it as the typical debit card overdraft fee is $35 at most big banks according to the Consumer Federation of America.

You might be able to get free transfers from your savings to your checking account for occasional overdrafts at one bank. At another, you might pay a fee every time a transfer is made for an overdraft. Fees for a line of credit vary widely, too. HSBC is charging a $19 annual fee to open a line of credit and another $10 every day you use it to cover overdrafts from a checking account.

The bottom line is that you should read account disclosures carefully to compare fees, and choose the least expensive option.

5. Use free ATM machines

Use ATMs in your bank's network to avoid fees. If there are no ATM machines in sight, use your debit card to make a small purchase at a store and get cash back.

Checking accounts don't have to cost a lot of money. Stay alert to bank fees and services to save money.

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