Put a plug in it – the bank fee money drain

Did you know bank fees are one of the biggest money drains on Aussie households, in front of gambling and even mobile phone excess charges? Mozo’s money geeks have crunched the numbers and found the average Aussie household is being slammed $487* in bank fees a year.

Banks are raking in billions of dollars from Aussies like you with sneaky charges that include account keeping fees, ATM fees, late fees and overdrawn account fees. But this doesn’t necessarily have to impact you and your hip pocket, as there are plenty of ways to put a plug in the bank fee money drain. Here’s 6 tactics to get you started:

1. Say NO to bank account keeping fees

If you’re charged a bank account keeping fee it’s time to either speak to your financial provider to see if they can wipe the fee or switch bank accounts. Right now out of 100 bank accounts in Mozo’s bank account hub there are 60 fee-free accounts, and a further 30 that waive the fee if you deposit a minimum amount per month (like your salary) or maintain a minimum balance.

2. Love thy ATM network

Lenders make around $555 million in ATM fees each year, so take a moment to consider how much of your hard earned cash has contributed to this profiteering. You can easily avoid the slap of a $2.00-$2.50 ATM fee by using your bank’s ATM network, getting money out at your local supermarket or paying with EFTPOS or credit card instead of cash.

Check out these ATM friendly bank accounts:

ING DIRECT Orange Everyday – fee-free access to every ATM in Australia, as long as you deposit $1,000 or more in the previous month. No monthly fees and no minimum opening deposit.
Bankwest Zero Transaction Account – fee-free access to all Bankwest, CBA, Westpac, NAB and ANZ branded ATMs Australia wide. No monthly fees and no minimum opening deposit.

3. Review your bank account regularly

Our research showed paying an overdrawn account fee is one of the biggest money drainers, so make sure you always have enough in your account by regularly reviewing your transaction history and bank balance through ATMs, online banking or mobile apps.

4. Set up automated credit card payments

Avoid the slap of a late payment fee by setting up an automated credit card transfer that will pay your credit card bill before the due date.

5. Don’t pay for unused home loan features

If you’re not using home loan features like an offset account, extra repayments or redraw facility, ask your financial provider to wipe your ongoing service fee. And if your bank won’t budge, consider switching to a more competitive home loan that doesn’t charge an ongoing service fee.

Check out these hot home loan deals:

loans.com.au Dream Home Loan Variable – 4.54% variable interest rate, no ongoing service fee and $520 upfront fee.
CUA Fresh Start Variable Home Loan – 4.65% variable interest rate, no ongoing service fee and $195 upfront fee.
HSBC Fixed Rate Loan – 4.79% 2 year fixed interest rate, no ongoing service fee and $852.50 upfront fee.

6. Consolidate your accounts

Take the time to combine all your accounts because there’s no point paying multiple fees for the same service. For example, you should have all your superannuation in the one account because each provider will charge an account keeping fee, which will eat away at your retirement savings.

How will you put a plug in the bank fee money drain?

* Based on 8.5 million households in Australia in 2011.

Put a plug in it – the bank fee money drain was last modified: August 18, 2014 by Rebeccah Elley

Share This Post

7 Comments - Write a Comment

  1. Good advice. Years ago I approached my ANZ bank branch and told them I refused to pay an account-keeping fee. I had multiple accounts with them and said I would take them all elsewhere if they didn’t reward my loyalty. I haven’t paid fees since!

    1. Mozo

      Hi Dillon,

      Thanks for the feedback. Yes, the market is now full of bank accounts that charge zero account-keeping fees so there’s no excuse why you should be paying them. If you don’t vote with your feet, the banks won’t take notice of you!