There’s nothing worse than receiving your bank account statement and realising you’ve accumulated all these additional bank charges you never knew about.
From monthly account keeping charges to sneaky ATM fees, there are a range of bank charges that with a little planning can be easily avoided. Read on as we detail some common bank charges and give you tips to stay away from them.
Some of the common bank charges that can slowly eat away from your account balance include:
Can’t remember whether your bank account has a monthly account keeping fee or not? Then chances are, you’ve had $4 slipping out of your account every month for simply maintaining the account. Sure, that’s just the cost of one cup of coffee, but it’s all these minor charges that add up at the end of the year. And given that you have the option to pick from so many fee-free bank accounts, it just doesn’t make sense for you to gift an extra $48 to the bank every year.
Top tip: Use Mozo’s database to find an account that does not have any monthly charges, or one that waives the additional fee if you make a minimum bank deposit (like your salary) each month.
Paying $2.50 for withdrawing your own money in your own city is downright ridiculous. And if you’re stuck with a bank account with a limited network of ATMs, you could find yourself doling out that additional money a tad too often.
Top tip: The best way to avoid ATM charges in pubs, clubs and convenience stores is by signing up with a bank account that comes with a wide network of fee-free ATMs or getting your money out at the supermarket when you do the shopping. Also, remember that many online banks let you use any ATM in Australia for free.
If you withdraw money from an ATM while you’re travelling overseas, you will need to pay an international ATM withdrawal fee of between $2-$5 per withdrawal. You may also need to pay extra charges by the overseas ATM operator for balance enquiry.
Top tip: Instead of wasting extra money on every withdrawal opt for a bank account, like the Citibank Plus Transaction Account, which allows for fee free overseas ATM withdrawals and purchases. Or, you can also go for a prepaid travel card with $0 overseas ATM withdrawal fee. Use Mozo’s prepaid travel card comparison table to look for the best value cards that come with no reload or closure fee.
If you’re using the debit card linked to your everyday bank account for shopping online from a store overseas, you could be stung by a foreign transaction fees of between 2-3%. This also applies to withdrawals from overseas ATMs or purchases made in person overseas.
Top tip: To avoid paying foreign transaction fees use a travel debit or credit card that does not charge international transaction fees.
Many banks and financial lenders charge a small fee of about $2 for every assisted withdrawal in a branch or agency or via telephone banking. If you have a checking account, remember that any cheque written by you and negotiated through the clearing system may also incur an additional fee.
Top tip: Look for a fee-free bank account that does not charge for assisted banking services such as counter withdrawals, counter deposits and phone banking.
If any payment on your account is dishonoured because of insufficient cleared funds in the bank account, you’ll be charged a dishonour fee, which is generally between $5-$10. This applies to payments made via cheques, direct debit and regular scheduled transactions.
Top tip: The best way to avoid a dishonour fee is to make sure you know exactly how much balance you have in your account so you only issue a payment when there is sufficient balance. It’s a good idea to access Internet banking and set up alerts for scheduled payments so you’re aware when a transaction is due.
An overdrawing approval fee, also known as honour fee, is applicable to some bank accounts when the bank honours a transaction which leads the account to be overdrawn or exceed its agreed overdraft limit. This is generally between $5-$10.
Top tip: Like the dishonour fee, you can avoid a bank penalty for exceeding your account’s agreed overdraft limit by regularly monitoring your account balance. You can also download a mobile banking app to have instant access to your linked bank accounts.
Even when an everyday bank account comes with a fixed monthly fee, there are certain instances when this fee can be waived:
If you can’t fulfil any of these conditions for waiving the monthly account fee, you can simply look for an account that does not charge this fee at all. All you need to do, is head over to Mozo’s comparison table for bank accounts, and look for an account that has $0 account fee.
But remember that account fee is just one aspect of your bank account, and you need to consider other important features as well before shortlisting the best bank account for your financial needs. Here are some other specifications that you should watch out for while picking an account: