ATM withdrawal fees
Most banks offer a certain number of ATM transactions free each month to their customers. Plan carefully each month your need for physical cash and take advantage of the number of free transactions available to you, as using other banks’ ATMs could cost you. And as much as possible, make purchases using your card or conduct your transactions online or with digital currency. It’s better for your security and reduces, and even eliminates fees that can add up.
In-branch fees
There are so many transactions that banks now allow you to complete at an ATM or online using their banking platform, so that you don’t have to spend valuable time joining a line in a branch. And many of these transactions are either free at the ATM or online or offered at a much-reduced cost. Some have even increased the amount of money you can transact, so that you can comfortably get your business done without the need to join a line in a branch. In fact, to discourage people from doing some of these transactions in their branches, some banks have implemented high fees to encourage use of their other channels.
Here are some transactions you can do online or at ATMs for free or for a significantly reduced cost than going into a branch:
- Withdrawals (some banks have an allowable limit of up $100,000 per day at ATMs).
- Transfers to other banks locally (ACH and RTGS).
- International wires.
- Bill payments (many banks offer this service free from their online platforms).
Although often there is no charge in-branch, some banks also allow loan payments via their ATMs and their online platforms for your convenience.
Point-of-sale transactions
To cover the costs of these technologies, which involve third-party services, banks charge a minimal fee every time you use your debit cards to make purchases.
However, there are ways to avoid these charges. Beyond carefully managing your spending monthly to reduce the number of times you’ll need to use your debit card, by using your credit card, you can avoid the charges altogether. And if your credit card rewards you with points every time you use it, that’s an added reason for you to use your credit card. But you must remember to pay it back by the due date!
Minimum balance charges
It costs banks to store and watch over your money. Plus, they are also required to maintain a certain percentage of cash versus loans under regulation, hence they apply a fee to depositors when their savings dip below a determined minimum balance.
However, you can avoid this fee by simply maintaining funds above the minimum balance in your savings account. A good way to do this, is to get a chequing account and spend from that account instead. Like everything else, your careful and good money management practices will be necessary to help you achieve prudence.
Dormant account fees
Again, it costs banks to maintain accounts and when accounts have no activity, the administrative costs to maintain them are high. Therefore, to get deposit holders to activate their accounts, fees are charged on the accounts.
At some banks, these fees are refundable once the account is reactivated. However, these fees can clearly be avoided by maintaining some activity on them. One could consider setting up a recurring payment on the account, for instance, to keep it going.