How to Spot Hidden Fees on a Checking Account

The fees banks charge their customers have skyrocketed, with almost anyone feeling the squeeze of all sorts of fees. If your account statement contains excessive fees each and every month, this is a cause of concern, but most fees can be effectively avoided. These are the so called hidden fees, and no law can force banks to explain them in a way that is easy to understand. But what can you do? One thing to do is change your financial and banking habits so that you pay considerably less in fees.

Of course, this is not enough. You should know that the fees banks charge are usually based on how many checks you write and the minimum balance. Keeping this in mind, you may want to contact several banks and check if they have a requirement to keep a minimum balance in order to benefit from free checking. You may also opt for a checking account, offered online. Some financial institutions feature low minimum balances and free checking, offering these to clients who do their banking online, using the website of the financial establishment.

ATMs fees are among the fees you may not notice at a first glance. However, if you use ATMs outside of your bank’s network, this may cost a couple of dollars per every transaction. To avoid these, locate your bank’s ATMs, which are close to your office and home.

If you spot a monthly maintenance fee on your account, this is something you can avoid. This is either a type of a baseline fee, or a fee that you owe if your account balance drops below certain amount in any given month. Be sure to check for such fees.

Another thing to watch for is whether your bank features unlimited check writing. With some financial establishments, you get free checking, but you will be charged a fee for every check you write. This is provided that you exceed a certain number of checks you are allowed a month.

A few banks impose fees if you are serviced by a bank teller. It may come as a surprise, but your account will be charged for talking to a bank’s representative rather than using their ATM network.

You may be asking yourself how high hidden fees can be. This depends on your bank, but let’s take a basic fee, for example, that you have to pay for an overdraft. If you are late paying, your bank will impose additional fees. Thus, you may end up paying close to 60 percent more than the original overdraft fee.

You may think certain services are free-of-charge as they once were. These include return deposit fees, check copy, and stop payment fees and can cost you a lot, depending on your bank. If you believe your check was stolen and request stop payment, you can pay anywhere between and $15 and $25. Then, if you request a check copy for tax or other purposes, this can cost you up to $10. We also have the bounced check that has been deposited. Not only is money withdrawn from your account, but you can expect to pay between $10 and $15 for the bounced check. You cannot really avoid these fees.

And why do banks charge you these fees to begin with? The problem is that most financial institutions face a tough environment, which is really the low-interest rate environment they operate in. Banks give out loans, but the profit margins on them are shrinking. Imposing additional fees is an easy way to earn money. What is the typical victim like? These are usually middle- and low-income persons, those strapped for cash, and college students.

The best way to spot hidden account fees is to read your user agreement, with all of the fine print you see. Hidden fees are not hidden at all, given than banks are required to provide their clients with this information by law. It is your responsibility to get familiar with all details in the agreement before you sign it.