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Guide To Bank Fees

Contributor:
Sorted.org.nz
Sorted.org.nz

For many savers, using ordinary bank
accounts is a convenient, low cost way of building up financial assets.
Banks charge fees but, for smaller savers, they are likely to be less
than the fees charged on other savings and investment products.

Everyday tips for saving on bank fees

Here are some ways to save on the fees your bank charges. You may
want to print these so that you can discuss them with your bank.

  • Find out about 'fee free' or 'reduced fee' accounts
    Ask your bank if they offer 'fee free' or 'reduced fee' accounts for
    certain customer groups. For example, you may be eligible if you
    receive superannuation, you're aged 18 and under, or you're a student
    or a recent graduate.
  • Get the right account
    Ask your bank which account is best for you. Tell them how you like to
    bank (for example, full service or just electronic deposits and
    withdrawals) and make sure they provide an account that matches your
    needs. If you don't think you'll use a cheque-book very often then
    consider an account without one - they often cost less. If you have a
    lot of transactions each month, consider an account that charges a flat
    fee and no individual transaction fees.
  • Close unused accounts
    Close any accounts you no longer need.
  • Know what fees are charged
    Find out what fees you get charged on your bank account. You may be
    able to avoid or keep some fees to a minimum. Transactions at the
    branch usually cost more than online and telephone banking or using
    EFTPOS and ATMs.
  • Negotiate the fees
    Ask your bank whether it's willing to reduce or waive any of the fees
    you pay. If you've got other business or a mortgage with the bank, you
    may qualify for discounts or the bank may be prepared to negotiate to
    keep your custom.
  • Pay off credit with direct debit
    Set up a direct debit to pay off your credit card. That way, you pay
    your card off in full each month and avoid high interest on unpaid
    balances.
  • Save on transfers
    If you have more than one account, ask your bank if they can deposit
    your salary into multiple accounts (for example, some into your
    everyday account and some into your savings account) so you avoid the
    cost of transferring money between accounts.
  • Avoid dishonour fees
    Make sure you have sufficient funds in your account to cover any
    upcoming payments so that you avoid overdrawn, dishonour or failed
    payment fees.
  • Consider an overdraft facility
    If you regularly go into overdraft, set up an overdraft facility. It'll be cheaper than paying daily dishonour fees.
  • Consider an online savings account
    If you've got a savings account, use an online account if you can -
    these often have no fees and the highest rate of interest.
  • Consider term deposits
    If you don't need access to your savings for a while, consider a term
    deposit. These usually offer a higher rate of interest and are 'fee
    free' if you do not make any withdrawals during the term of the
    investment.
  • Get paid to your home loan account
    You may be able to set up a revolving credit account so that your
    income goes into your home loan account. Providing you stick to a
    budget, you could pay off your loan more quickly.
  • Find out how interest is paid
    If you've got a high credit balance, find out whether interest is
    credited on the daily balance or the minimum monthly balance and how
    often it's paid. You're likely to earn more interest if it's credited
    on the daily balance; you'll also be better off if the interest is
    credited monthly rather than quarterly or annually.
  • Use ATMs with low or no fees
    Find out which banks charge the lowest or no fees when you withdraw
    cash from their ATMs and make sure you only use those ones.
  • Get cash when buying with EFTPOS
    Get cash out when making EFTPOS purchases and you won't have to pay an extra withdrawal fee.
  • Don't get cash from credit
    Don't withdraw cash from your credit card - banks charge high fees for doing so.
  • Bank online
    Try doing as much of your banking online - it's often free or cheaper.

 

Content provided by Sorted.org.nz, Your Independent Money Guide.

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