Bank of America has been charging consumers $5 a month for
using its debit cards to shop. Other national banks, like
Citibank and Wells Fargo, are either hiking or testing fees
as well.
Starting in December, Citibank customers with a checking
account will be hit with a fee of $15 per month unless
they carry a minimum balance of $6,000.
Banks are blaming the recently implemented Durbin Amendment
to the Dodd-Frank Act, which put a cap on "swipe fees", or
the amount that bankscharge merchants for processing debit
card transactions. This especially affects big banks, since
some small banks are exempt from this cap.
In the past, if you overdrew your account, your bank likely
covered for you and charged a $30 overdraft fee whether you
signed up for that "protection" or not. Now, banks can't
automatically enroll customers - you have to grant permission.
Free checking seems to be going away too. In 2011, only
45% of non-interest checking accounts were completely free
of fees, according to a survey by Bankrate.com. In 2009,
more than 75% of banks offered free checking.
That's two big moneymakers that banks can no longer count
on to bring in the big bucks. What this means is that the
banks will be hitting the consumer with maintenance fees,
minimum blance balance requirements and other charges for
services that people are used to getting for free.
Here are some things to consider:
1) Get an Accout Makeover. See a representative. They
may be able to help you bundle certain services together
help you set up bill pay and direct deposit and other
money saving strategies. They can also explain the
new fees and how they will affect you.
2) Look into a Credit Union or Community Bank. Credit
Unions are non-profit financial institutions owned by
its members. Typically smaller than other banks, a
credit union can offer loans, accounts and other services
at more competitive rates than your average national
bank. Its goal is to best serve the members of the
union, not to maximize profits. Community banks
also offer a chance for more cometitive rates than
bigger bankis. People also like the customer service
aspect provided by a small bank.
3) Use your Credit Card. Credit cards have advantages
that debit cards do not have, such as, points, miles
and better protection against fraud and theft. If
you don't want to touch credit cards (i don't blame
you), try a prepaid card for your monthly budgeting.
4) PAY THE OLD-FASHIONED WAY: CASH OR CHECK - This way
you can be in control of what you spend and don't
have to pay a fee.
