Bank accounts can be a convenient, inexpensive, safe way to transact business. But you need to choose carefully and keep watch for fee or other bank policy changes. Bank accounts typically work best for consumers who can leave a cushion in their account to protect themselves from overdrafts.

Strategies to Avoid Fees

• Checking Accounts: Find out the balance required to avoid a monthly maintenance fee. Sometimes you can avoid this fee with a specified direct deposit – such as a paycheck. Understand that monthly maintenance fees can apply to savings as well as checking accounts. Be realistic as to whether you can maintain the minimum required balance. Going below the minimum can cause your account balance to go negative.
• Link Checking to Savings Accounts: Most banks will automatically transfer money from savings to checking accounts if you overdraft in checking. Beware that some banks will charge a transfer fee for this service.
• Opt-out of overdraft coverage. If you are paying a lot of overdraft fees, consider opting out of overdraft coverage for debit purchases or ATM withdrawals. Without overdraft coverage, your card will be declined if you don’t have enough money in your account to cover a debit purchase or ATM withdrawal. So you won’t be able to complete the transaction, but you won’t be charged an overdraft fee.
• Monitor your account. Frequently check account transactions and balances. Be alert for communications from your bank about fee changes.
• ATM Fees: Plan ahead if you need cash. Find out which ATM machines are in your network.
• Transfer Fees: Some banks will charge if you transfer money to another bank or investment accounts. Initiate the transfer from the account that does not have a fee to void this charge.

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