Banks often charge fees for various products and services, from savings accounts to checking accounts. But with some savvy planning, you can reduce these fees and keep more money in your pocket. Here’s how:
Understand How You Use Your Accounts
The first step in reducing bank fees is to understand how you use your accounts. Why pay monthly fees for features you’ll never use? On the flip side, if you opt for a fee-per-transaction account, beware—those fees can quickly add up. Assess your banking habits and choose an account that aligns with your needs.
Monthly Fees and Transaction Limits
Many bank accounts come with a set monthly fee that allows a certain number of transactions. The number and type of transactions included in your monthly fee depend on your account type. If you exceed this pre-set number, you’ll incur extra charges for each transaction, so it’s crucial to monitor your account activity.
Take Advantage of Minimum Balance Waivers
Did you know that maintaining a minimum balance could save you money? For example, if your account charges a $12 monthly fee, keeping a balance of $2,000 might allow your bank to waive that fee—saving you $144 annually. Check if your account offers this feature and consider maintaining the required balance.
Look for Multi-Product Discounts
If you have multiple banking products—like a mortgage and a credit card—you might qualify for a multi-product discount. Some financial institutions offer reduced fees if you bundle services, so ask your bank if you’re eligible for this type of discount.
Consider a Low-Cost Account
Some financial institutions have agreements with the federal government to offer low-cost accounts with basic features, charging a maximum of $4 per month in fees. Even better, you may qualify for a free low-cost account if you meet specific conditions. Explore these options if your banking needs are straightforward.
Stay Informed and Ask Questions
Before opening an account, make sure you fully understand the terms and conditions, including any fees. Don’t hesitate to ask questions about anything unclear, and keep a copy of your account agreement for your records.
Banks are also required to send electronic alerts if your account balance falls below $100 or another limit you set, helping you avoid costly overdraft fees.
To learn more and use an account comparison tool to find accounts best suited to you, visit canada.ca/money.
