Say no to rising bank fees

If you don’t wish to get exposed, burry down your ill wills which you can’t afford to share. In the very midst of a panic financial scenario, it is better to save and cut down the crazy expenses which may prove cruel for you afterwards. It is very well said by a philosopher that “when you walk in market with a bag of money, just take care of your earnings because you need to survive and even the people want to”. The same thoughts are practical in this phase as the banking institutes have decided to raise their bank fees and make huge earnings out of your earning.

The banks have raised $2 on the online payment of your bill and recently in this month the service fees for your account is raised by $1. It sounds so simple and practical that it’s a mere one dollar which is increased!! But this is not still enough for their stomach, as they have roused the ATM charges from $1 to straight away $2.5. Now, how is that? This difference of just a dollar and a half multiplies when it comes to the millions of transactions.

Previously in the ancient times, there were some money-lenders who were charging more than they lent. If we see the earnings of some banks only from the fees and charges, the money lenders will prove as nice guys. The data says that banks have made up $38.6 billions just from the penalties and fees from the customers in 2007, which rose in 2008 and if the trend continues, it may increase drastically in 2009. If you believe your eyes and what you read then let me share you the NPR review that many banks make half of their earnings just from fees and penalties!!

It is so ridiculous that we, the people struggle and suffer hard for the single penny, and that just disappears in the name of overdraft or fees in bank’s pockets. It’s true that they are there to earn but we also need to check the flow of our earnings.

Let’s check where we can tie a tight seat belt with banks and have a hold on our money. The biggest share holder of the bank fees are the overdraft fees. Now, wisely if we think the statistics; according to Bankrate.com, the typical overdraft costs $30 to the customer from the own bank. Instead, the payee of the bounce check will be charged somewhere between $10-20. The amount of check is totally irrelative, may be $5 or $500. Strange na? But we do pay it.

Data gathered by Bretton Woods screams that the average household with checking accounts spent $368 on non-sufficient funds (NSF) fees in 2008. Those in the higher end – over 20 million households with more than the usual NSF activity – each typically spent an unbelievable $1,472 in overdraft. Now calculate the single and a half dollar increase in fees makes some sense, right?

These are still the old and obsolete story of last year, as in 2009; the banks are going to charge one fee for the first item and a large amount on the sub sequent ones. Simply saying, if three of your checks are bounced in a day, the charges for the first one will cost you around $19 and the rest may cost you almost double like$35.

Recently President Barack Obama had a meeting at the White House with Banking Executives and asks for the clarity, transparency and more importantly an end to some of the “abusive” fess and charges. Now, that’s an astonishing step in the history as till date we all were nodding our heads in what banks charges us. The stunning statement was made by Ed Mierzwinski, the consumer program director for US PIRG, that “the banks can’t cheat, lie or steal anymore”.

It’s a revealing fact that some banks make money by some unfair policies and fees, we truly need to shop for the banks who don’t charge us for the services we deserve. For example we deposit the money with the bank and banks lend that money to industries in quite higher interest rates. Now, if they are making enough money from our deposits, why do they charge for the services? Shouldn’t be it a right of us to earn services in exchange of that money made up by bank?

Now, time has come not to ask questions to the deaf ears but to take some concrete steps on the individual level. We may not change the banking structure, but yes, we can surely make it with our own structure. That’s not a big deal also. We just need to learn where banks are charging excessively and where we can safely take out our self from. Some of the practices which can save substantial money of us over a period and also to systemize our self are suggested:

• Banks charges for the ATM withdrawal, even it may be $20 or $200. So, have a practice of taking out more money at time than what you are required.
• Do not take out money unless it is urgent as every time you are charged on ATM withdrawals.
• Have a practice of using the same bank ATM, the card you possess. Actually, if we are taking out money from other bank’s ATM, we are charged by both the banks.
• Normally, same banks won’t charge you for the ATM withdrawals up to a certain limit of transaction, make sure you stick to that limit.
• Just have an internet checking account that reimburses all the ATM fees, because internet doesn’t have money and customers have to arrange cash anyhow, which itself reduces the transactions.
• Never pay a monthly maintenance or service fees for your bank accounts. Local banks and credit options gives you an option, choose any of them even at pay of $5 to $20 a month.

The basic thing is to select a bank intelligently. It’s like a Live-in relationship. You select your partner after proper scrutiny, Keep in touch after you decide and if anything happens out of solution, you are free to shop else. Work at your conditions. Pay all your bills online and make sure they are fee-free. Honor the bank limits in every field. Plan your money and have some disciplined habits to avoid fees and charges of banks.

Remember, for the systems to change, we need to change our systems. If you have any of better or bitter experience of your banks, share with us.