Banking carelessness may seem like you are losing a small about of money at the time; however, dipping into your overdraft and withdrawing money from an ATM machine that isn’t linked to your bank can cost quite a buddle as the years go by.
Below are some ways you can potentially lose out on a ton of money, thanks to those banking fees:
Monthly Maintenance Account Fees: As per a GoBankingRates.com survey, on average, Americans pay about $7 each month in account maintenance fees. If you were to place that money into a separate savings account, with a 0.09 percent annual interest rate, you’d earn a cool $91; racking up just over $5,200 over a lifetime, potentially doubling that amount if it was in a high-interest savings account. Sometimes it is worth it to simply take a look at what other banks are offering when it comes to account fees, it can save you a lot over time.
Overdraft: Most Americans are guilty of dipping into that overdraft at times; however, if you make it a regular thing, it can add up overtime. The average fee for dipping into overdraft is $35/use. If your family has experienced a challenging month where you have required to use your overdraft twice, this could equal out to a whopping $70 monthly. Even merely using your overdraft once a month could really hurt overtime. Within 30 years, over $12,500 could be wasted on overdraft fees alone.
ATM Fees: What’s a mere $2.50 per use for an out-of-network ATM machine when you are in a pinch? No harm in that, right? Well, WRONG! For those that make it a habit of using these bank machines every other day, over a 30-year time period that’s just over $13,600 wasted on fees trying to access your own money.
Deposit Account Interest Rates: While you aren’t wasting money, per se, finding a bank with the highest deposit account interest can help you earn more money. If you are currently with a bank that offers 0.10 percent savings rate, over 30 years, you can make about $30 for every $1,000 that’s in there. On the other hand, if you shop a little and find a rate of $0.85, you’d be earning about $290 for every $1,000 in the account. See the difference?
They say it’s the little things that count sometimes, and the same can go for banking fees. While it may seem like you are losing small amounts here and there, over time, it does create a significant impact.
Dorathy has an economics minor from York University in Toronto, Ontario and worked for one of Canada’s largest banks. She will share her own financial tips and keep you updated on current finance news.