The first year or so that I had a Chase checking account, I was paying $25 per month because I didn’t maintain their preferred average daily balance. All it took to solve this was a 5-minute phone call, in which I asked if I could switch to the checking account with a lower monthly balance threshold that was offered.
“You’ll lose out on the interest if you do that,” the kind woman on the phone informed me.
“But I’m paying $25 per month for you to hold onto my money, and you’re giving me about a penny each month back,” I responded. Undoubtedly she was required to say that, and she quickly changed my checking to the lesser, interest-free product. Since, I’ve been account maintenance fee-free. It was a costly mistake on my part, and I felt very dumb.
What I’m trying to say is, life is too short to pay bank fees—minimum balance fees, ATM fees, NSF fees, overdraft fees, all of them. There are so many ways to not pay them, that if they’re charging you, you should take your money and get out. You have so many options.
I stuck with Chase because I like the convenience of it in New York, and my roommate at the time also had Chase, so I could easily pay her rent money using Chase Pay. As I’m sure you’ve realized, I’m very lazy. I sometimes still incur two fees for using shady bodega ATMs I could avoid if I found a bank-branded machine. All of that is easily-avoidable.
If you’re fed up enough with your brick-and-mortar to actually make the switch, online banks like Ally and Bank of the Internet (yes, it is a real thing) offer free checking accounts with a sliver of interest, and they also use the Allpoint ATM network or offer ATM reimbursements (usually up to a certain number of times per month).
What you’re missing with online banks is the option to go into a branch and talk to someone in person. Maybe this is another positive for you, or maybe that freaks you out. If it’s the latter, you have another option that’s just as good.
Credit unions are wonderful. Everyone should join a credit union. These institutions are member-owned nonprofits, and all have their own rules for membership, based on geography, faith, etc. But there are plenty of credit unions that you can join from anywhere, usually for the price of a one-time donation.
Kiplinger has a handy list of credit unions anyone can join. But one that stuck out to me in past research is Lake Michigan Credit Union, which offers a checking account with 3% APY and up to $15 in ATM reimbursements each month. If you don’t live in Michigan, all that’s required to open an account is a $5 donation to ALS Foundation.
But there are plenty of good options. You can find a credit union with this search tool.
Whichever you choose, mind the potential overdraft fees
The last piece of the puzzle is the overdraft fee. The average fee now hovers around $35, and some banks charge multiple overdraft fees each day if you make multiple transactions.
Each bank and credit union has their own overdraft rules. Bank of the Internet, for example, does not charge overdraft fees, they simply decline the transaction. Simple and Chime are two other nontraditional banks that don’t charge them either. Online-only banks and credit unions charge $9 less on average for an overdraft than national and regional banks, according to NerdWallet.
One way to avoid an overdraft fee, if your bank charges one, is to not opt into overdraft protection programs. If you don’t opt in, your debit card or ATM transaction will be declined if you don’t have the funds in your checking account to cover it—you won’t be able to purchase whatever it is you were buying, but you also won’t be hit with the $25 to $35 fee. If you do opt into coverage, you’ll be able to make your purchases but you’ll pay an additional $35 for them.
Some institutions also offer free transfers from a linked savings account, while others offer an overdraft line of credit with an annualized interest rate (you pay pretty low interest on the amount you’ve overdrawn). And if your bank offers text message alerts about your balance, that’s a good way to stay informed about your account balance so you don’t find yourself in the situation at all.
It’s all about doing your research. You shouldn’t pay a bank for the privilege of holding your money. We all deserve better than that.
from Lifehacker http://bit.ly/2DiypDr