How to avoid financial fees, and keep more of your cash
Also, check out tips on earning interest, dodging high rates on credit cards.
Published: April 25, 2012 06:59PM
Updated: April 27, 2012 06:30PM
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With a little effort, you can keep others' hooks out of your wallet. Courtesy Philip Friedman/Studio D

The days of quaint savings passbooks (remember those?) and a free toaster for opening a checking account are gone. Today you’re more likely to manage your savings online and get billed when you open a checking account.

With all the new fees, regulations and teeny interest rates on savings, banking has become confusing and costly. Let Good Housekeeping shed some light on a few of your most common banking questions — and help you to keep more of your hard-earned cash.

I’m relieved that my bank isn’t charging for my debit-card usage, but I’m still seeing all kinds of fees on my monthly statements. What gives?

Would you believe that numerous banks have as many as 49 possible fees for checking accounts? And many have raised monthly fees to an average that’s creeping close to $15. So, review your monthly bank statements, and see what charges are being made? It’s becoming increasingly common to pay fees for such transactions as making a transfer or payment over the phone. And some banks charge $3 for using an out-of-network ATM; plus, that ATM may well debit you another $3 for the privilege of accessing the cash.

There are no-fee banking options out there, and tools to help you shop for them. For example, Ally Bank offers a free online checking account that requires no minimum balance and allows you to deposit checks online (you scan the check and send it electronically) for no additional charge. There are no ATM fees, either. ING Direct USA has free checking accounts that even earn interest (every little bit counts).

Scour bank reviews (rating on customer service, fees, etc.) at mybanktracker.com, and don’t rule out credit unions, which have some of the lowest checking fees around and are more likely to offer lower-interest loans and credit cards. You can look for credit unions at the National Credit Union Administration website, ncua.gov.

I’ve saved some cash for an emergency fund, but it earns hardly any interest in my savings account. Could it do better elsewhere?

Remember the days of earning 4.5 percent on a savings account? Well, those days aren’t very likely to come back. The Federal Reserve, which determines many interest rates, has said it’ll hold the line at or close to 0 percent at least into 2014. Banks will keep interest rates just as low — which is also great for loans and credit cards. Let’s say you’re carrying a balance of $3,500 on a card that charges 17 percent interest.

Moving that balance to a card with a 0 percent offer (that is, assuming you have great credit and qualify for that rate) means saving more than $300 in interest if you take a year to pay it off.”

But before you sign up, remember that the offers can be used only within savings. Still, you might as well try to offset the cost of inflation and earn just a tad on your money. Shop around for savings accounts with some yield — online banks and credit unions offer 1 percent or thereabouts — at sites such as bankrate.com. Keep in mind that if your checking and saving accounts are with the same bank, you may be able to link them for a larger, combined balance; avoiding low-balance fees on your checking account.

Helpful websites

mybanktracker.com • for banking reviews and customer-service ratings

ncua.gov • for a credit union near you

bankrate.com • for information on savings accounts