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BANKING & CREDIT
BANKING MONEY SAVING TIPS
Most people use banks or credit unions for everyday checking and savings account services, as well as a place to invest funds on a secure basis. Banks make a considerable part of their income through charging fees for their various services, as well as their ability to attract investments at low interest rates and lend money at high interest rates. With a little diligence, the fees paid to the bank can be minimized, interest earned can be maximized, and interest paid can be reduced. Consider the following:
1. Most everyone has a checking account. But not everyone pays a fee for their checking. Ask your bank if they have a free checking account that does not require a large checking account balance. If not, ask them to waive the fees or shop around for a bank that does have true free checking. They do exist.
a. When shopping for a bank account, also consider if there are fees for ATM cards, as well as debit cards. These fees vary widely and a little shopping around should save some money, without any deterioration in service levels.
b. Sometimes checking account fees are waived if you have direct deposit of your pay check. Direct deposit really is easier and just as safe as paper checks (perhaps safer since checks can be lost). It is also faster and saves money on gas.
c. Make sure you get a checking account that meets your needs. Some people write a lot of checks, some a few, etc. Get the right kind of account for you.
d. Ask your bank if they have any special deals for senior citizens or students, or any other special deals available.
e. Sometimes checking accounts even include free checks. If so, great. If not, check the cost of checks purchased through your bank with checks purchased through check printing services. Checks are available through mail order companies and on the Internet, and may save you up to 50% of the cost.
f. Most banks offer free electronic banking, including free on-
g. Make sure your bank does not charge transaction or other fees for use of your ATM card at their ATM machines. Also, see if they charge a fee for using your card at another bank’s ATM which is in addition to the other bank’s ATM fee. And try not to use your ATM card at another bank in order to avoid their fee.
h. Make sure you balance your checkbook regularly and avoid overdraft fees. Consider not having any automatic deductions from your checking account for bill payments, to help ensure you do not have an overdraft. Consider getting overdraft protection. Ask your bank.
2. People use bank savings accounts, money market funds and certificates of deposit (CD’s) to invest funds not required for immediate use. Consider the following:
a. Bank savings accounts and money market funds (particularly those offered by large banks) are usually handy, but normally pay a very low rate of interest. Generally, try to keep only the minimal amount of funds in these accounts that is necessary for emergency expenses. Also, it pays to shop around for these types of accounts to see what interest rates are available. Interest rates can vary significantly.
b. Certificates of deposit (CD’s) are more commonly used to invest money that is not required for a period of time. These are purchased from the bank for a stated interest rate return for a fixed period of time. Rates of return can vary substantially from bank to bank, and lengths of maturity for the CD. When an existing CD comes due, or if you have additional funds to put in CD’s, it pays to shop around at that point in time to see what rates are available. Rates are generally published in the paper or available over web sites on the Internet, such as Bankrate.com or Bankaholic.com. Or call up several banks to check.
3. Credit unions are a popular alternative to banks and often offer services at lower cost, and investment products, such as CD’s, at a higher rate of interest. If you have access to a credit union check it out and see if it is the best deal.
4. Internet-
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