I’m a Bank Teller: 7 Tips for Understanding Bank Fees and How To Minimize Them

According to the Consumer Financial Protection Bureau (CFPB), banking consumers could save almost $2 billion annually moving forward with the majority of non-sufficient fund (NSF) fees eliminated.

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Over the years, banking fees could have added up for you, causing you to spend a decent amount of money on them without even realizing it. To help you better understand and minimize bank fees, GOBankingRates reached out to experts for their tips.

Here’s what banking experts suggest you do to avoid wasting money on fees .

Understand Account Minimums

Vrinda Gupta is the CEO and co-founder of Sequin , a women-focused banking company. Her first piece of advice focuses on understanding account minimums.

“Make sure to read the fine print on how much you need to keep in your account at all times to avoid fees because these can sneak up on you,” she warned.

It’s essential that you’re aware of the account minimums associated with your bank so that you meet the requirements and avoid additional fees.

Here are a few tips to help you minimize account minimum fees:

• Look for accounts that don’t have minimum balance requirements set
• Set up your direct deposit with your employer. If you automatically have your paycheck sent to your account, some banks will waive the fees.

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Look into Overdraft Fees

Gupta also recommended that you always be aware of how much is in your account at all times because if you go below your balance, you’ll be hit with overdraft fees.

As Janelle Sallenave, a banking expert and the chief spending officer at Chime , explained, “Overdraft fees occur when you spend more than you have in your account. These are often hefty — usually about $35 per transaction and can add up quickly.”

According to Sallenave, the best way to avoid overdraft fees is to look for an account that offers fee-free overdraft options. Gupta added that if you overdraft your account, you should call your bank and ask for the fee to be reversed.

To minimize this fee, you must be aware of how much money you have in your account and the expenses you are incurring. Some banks will allow you to set up account alerts, so you’ll be notified when your balance drops to a certain level.

NSF Fees Are Different From Overdraft Fees

“Non-sufficient funds fees occur if you try to spend more money than you have in your account,” said Sallenave. “This fee averages around $34 per declined transaction.”

It’s worth pointing out that NSF fees vary from overdraft fees since it depends on how your bank processes the transaction. Your bank will charge an overdraft when they process the transaction but will charge an NSF fee when the transaction is rejected.

Sallenave noted that if you want to avoid these charges, you should keep a close eye on your balance or use a banking partner that doesn’t charge these fees.

Inactivity Fees

If you have a bank account that’s been opened for a while that you’ve forgotten about, Gupta said you may have inactivity fees sneaking up on you.

She said, “Take a few minutes to take a look at dormant accounts and make sure those are closed.”

Account Maintenance Expenses

Did you know that some banks will charge you a monthly fee just for having an account? Sallenave said that it’s “usually between $5 and $12 but can quickly add up.”

A typical banking fee you should be aware of is the account maintenance cost, which some providers charge for simply having an account. You can usually have this fee waived by carrying a specific balance.

However, if you don’t have the funds to have the fee waived, you can also look into a free banking account as there are many options available out there.

ATM Usage Costs

Some banks will charge an ATM fee when you use a machine outside of their network. This can turn into a larger charge if the ATM provider has a separate cost as well. Business Insider reported that these out-of-network transaction fees can add up to $5.50 per transaction if you get two charges.

To avoid these ATM fees, Sallenave suggested sticking to ATMS within your bank’s network. You could also look for an account that provides ATM fee reimbursement to cover any charges from the ATM provider.

However, the best way to minimize these ATM fees is to understand the terms of the bank account before signing up. You don’t want to be caught off guard when you’re withdrawing some money and end up paying an extra $5 to access your funds.

Foreign Transaction Fees

Lastly, Sallenave brought up transactions fees, which results from using your card abroad and range from 2% to 4% of each purchase. To save on these fees, you’ll want to find a bank or card issuer that doesn’t charge for international transactions.

One of the main messages from this article should be that it’s important to review the terms and conditions of your bank account so that you know what to expect during your banking journey. If you’re unsatisfied with your current service, you can always switch over to one better suited to your financial goals.

This article originally appeared on GOBankingRates.com : I’m a Bank Teller: 7 Tips for Understanding Bank Fees and How To Minimize Them