We all like to know that we are getting the best value
for our money. In fact, most of us don’t mind paying for something that
provides us with good value in return.
Unfortunately, you might be surprised to discover that
there are plenty of fees you are paying right now that provide you zero return
for your money — and those fees add up. Here are eight fees you need to stop
paying .
1. Overdraft Fees
One of the most lucrative fees for banks is the overdraft
fee. When you go over your limit, you pay a fee of anywhere between $25 and
$45, depending on your bank’s policies.
The CARD Act passed in 2009 prevents credit cards from
charging you unless you opt in to allow overdraft transactions. Check your
preferences to see if you opted in. If you did, opt back out.
With your checking account, either track your spending
and improve your cash flow to avoid checking overdraft, or see if you can
connect your account to a savings account or a line of credit to avoid the
higher charges. If you use a line of credit, make sure you pay off the charge
quickly to avoid interest.
2. ATM Fees
ATM fees continue to rise. If you use an ATM not owned by
your bank, you could be hit with two charges — one from your bank, and one from
the ATM. Instead, open an account at a bank that reimburses your ATM fees, or
only use ATMs owned by your bank. You can also avoid the ATM by asking for cash
back when you use your debit card at the store or by going in and speaking with
a teller at a bank.
3. Third-Party Cell Phone Fees
Watch out for third-party cell phone fees. For example,
some carriers might show charges for third-party message services. Look through
your bill carefully to find these charges, then call your carrier and cancel
them.
You might also find a charge for directory assistance
(411 charges). Thanks to Google, most of us don’t need this. If you have a data
plan, you can just look for the number online.
4. Investment Account Maintenance Fees
If you have an investment account, check to see if you
are paying maintenance fees. Some brokers charge a monthly or annual fee just
for “account maintenance.” If you meet minimum requirements, you might be able
to avoid this fee, but there are brokers that charge the fee regardless. The
good news is that there are plenty of online discount brokers that offer
accounts without maintenance fees. Transfer your money to the new account and
save. (But watch out for brokers that charge you fees for moving your money or
closing your account.)
5. Unnecessary Credit Card Fees
Some credit cards charge annual fees — but not all of
them. That means that if you’re currently paying an annual fee, it’s time to
search for a new card — you can even find rewards cards without annual fees.
Also, if you are a traveler, there is no reason to pay the foreign transaction
fee. Increasingly, there are credit card issuers that won’t charge these fees.
6. Extended Warranties
When you buy certain products, you might be offered the
opportunity to purchase an extended warranty. The fee you pay for an extended
warranty is rarely worth it. Many products have manufacturer warranties that
work just fine, and many credit cards offer extended warranties as well if you
use them to make your purchase. Check your credit card benefits to find out if
you are protected. You can usually get an extension of at least one year beyond
the manufacturer warranty when you buy with a credit card.
7. Checking Account Fees
A couple of years ago, there was an effort by the
financial industry to move toward adding fees to checking accounts. Consumers
expressed their feelings on the subject, and, as a result, it’s still possible to
access free checking accounts.
If your bank charges you a monthly fee just for having a
checking account, you can look elsewhere. There are still plenty of credit
unions, online banks, and even more traditional banks that provide free
checking. There’s no reason to pay a monthly fee to access your own money in a
deposit account.
8. Roaming Fees
Whether you’re using your cell phone for checking email,
surfing the web, getting GPS directions, or even making actual phone calls,
it’s important to pay attention to roaming fees when you travel. Call your
provider to find out how much you will pay for data and talk. Also, realize
that you might have extra charges if you are based at home, but talk or text
with someone outside the country. I was surprised when I discovered that my
texts to a friend in Canada cost extra (even though calls didn’t). Find out
what to expect, and then do what you can to mitigate the costs. In some cases,
if you are going on an extended trip, it can make sense to get a different plan
compatible with the area you are visiting.
What unnecessary fees have you stopped paying?