Ditching Bank Fees
Lesson 8 from: FAST CLASS: How to Plan Your Financial FutureErin Lowry/Broke Millennial
Ditching Bank Fees
Lesson 8 from: FAST CLASS: How to Plan Your Financial FutureErin Lowry/Broke Millennial
Lessons
Class Introduction
02:04 2The Getting Financially Naked Playbook
10:05 3Financial Red Flags
02:51 4When and Where to Turn for Help
01:53 5Talking Money with Your Friends
04:58 6Stand Up for Your Financial Self
02:03 7Picking Financial Products and a Planner
03:57 8Ditching Bank Fees
03:52What You Should Expect from Your Bank Accounts
04:42 10Everything You Need to Know About Credit Cards
11:45 11Am I Ready to Hire a Financial Planner?
10:48 12Planning for Retirement
08:23 13Retirement Accounts
07:27 14Basic Investing Concepts
05:06 15Self Employed Retirement Planning
02:59 16Setting Up Your Retirement Account
04:07 17What Happens to 401(K) When You Leave Your Job
02:58 18Motivating Yourself to Save
03:47Lesson Info
Ditching Bank Fees
So we are going to dig into talking about fees that you are going to experience with financial products at this point, we really are focused more on banking accounts. So savings accounts checking accounts, not so much focused on credit cards yet that is definitely coming first. Who's been hit with an overdraft fee show of hands and those of you tuning in online, feel free to shout it out. If you two have been hit with an overdraft fee at some point in your life, it usually happens to all of us and comes to us all at some point. And it is the legal way that banks suck you dry. And so the fact that they are then milking every single penny out of you is problematic. Now if you personally have never experienced an overdraft fee, you've always stayed perfectly on budget. Never accidentally overdrawn your account. That's great. But if your bank is doing this to other people, other customers, that's something that should offend you personally. And that's why I don't think you should be bankin...
g with an institution that does this to its customers because it's about respect. And I'm going to keep coming back to this idea because even if you personally do not have an issue with this because you're so good with your money, I still think you should be upset that they're doing this to other folks. And especially often this usually hits people at the lower end of the socioeconomic totem pole as well as college students who usually do not have the money. And then on top of that there's typically another fee that if you can't pay those feedback within typically five business days to hit you again with an overdrawn fee for perhaps 1/4 time. Another thing to know about overdrafts and transaction reordering is a lot of banks do allow you to have 3-4 overdraft fees in a single day, So that's why you could be out spending money not realizing you've gone over drawn in the first place and that's how you can get up to about $100 plus dollars in fees in a single day. Now, sometimes they offer this thing called overdraft protection and how this works as they say, hey, we're going to link your checking account to your savings account. So if you overdraw no big deal, we're going to pull money out of your savings account into your checking account to cover the shortfall shortfall. Usually it's in about $100 increments, but that could vary depending on your bank. Alright, that's nice. Some of them also will set up a line of credit option for you. So there might be a small interest rate, but it's not going to be as high as the fee. The problem is It costs them like pennies on the dollar to move your own money from savings to checking and a lot of them will charge you $12 to do it. Another term you might hear is non sufficient funds fee. This is pretty much the same as an overdraft fee. Sometimes though, instead of allowing you to overdraft and make the transaction, they reject it, they reject the transaction for you saying you don't have enough funds. Non sufficient fund, but they still charge you For trying to make the transaction. And usually it's the same amount as for an overdraft. So typically $30-$35 depending on the institution. So here's some other common banking fees I'm sure that you have heard of and I guarantee you have experienced at least one Account minimum fee. This is saying usually you have to have a certain balance in your account every single day of the month. In order to avoid this fee, you might hear something like your checking account balance needs to be $1,500 every day, not cumulative across the month. And if you dip below that at any point we will charge you an account minimum fee. Another one is a monthly account maintenance fee, pretty much the same thing. It might not be a minimum balance requirement, but every month for the privilege of having a checking account with this bank, they are going to charge you something like $10-12 every single month. A TMP. I'm betting all of us have paid this at some point or another in our life. The thing too is a TMP can come in two forms. The A. T. M. Can first come because your bank is charging you for using another bank's a t. M, and then that other bank is charging you for not being their customer.
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