Saving money is one of those things that are easier said than done. Banks are financial institutions that serve as financial intermediaries. Banks pay us interest on the money we lend out to them. Some tips can be kept in mind while dealing with banks, in order to make the best of our investment.
Most bank products cost you money. So, you have to make sure that you have the right account for your spending habits. Let us say that you pay the bank money for the ability to write cheques, but you never write cheques. So why are you still paying for it? It would be a wise idea to get rid of this product that you never use. Many banks charge you money for every returned cheque if your bank balance is negative. This charge is called “bounced check fee”. Consider adding an overdraft protection to your account. If your checking account should ever go into a negative balance, your overdraft protection will cover the negative amount without incurring excess charges. Most banks charge a small fee for this service, but this fee is much smaller than the bounced check fee. Furthermore, you’ve all seen them, those enticing loan ads. But most people don’t read the small print or don’t look at the rates, which can be very high. Banks make it much too easy to borrow money, so don’t get sucked in. Only borrow money if you really have to A better thing to do is to save money (emergency fund) before hand. Moreover, online banking is a wise option. It is not only easy, it also gives you control over your finances. You can easily transfer money between checking and savings accounts (interest rates are higher on savings accounts so putting left over money there is wise). You can automatically pay recurring bills, so you will avoid late fees. You will also use fewer cheques or maybe you don’t need cheques anymore.
Always get cash from your own bank’s ATM’s. Other banks will charge you a fee for using their ATM’s. Using credit cards is never wise, but if you can’t avoid it then at least use a “cash-back” card. You also have to try to pay it off in full every month. Try to find a card that has no annual fee or at least as low as possible. Also try to find a card that has low interest rates. It can be worthwhile to ask for a fee waiver if you have a legitimate excuse for late payments. Just call customer service and ask. Asking is free. Late fees can be high, so always try to avoid them. You can always negotiate about the interest rates on your credit card. Everyone has seen the ads for lower interest on the same card you already have. Call customer service and ask for the same rate as being offered in the ad.
Tips and comments:
If you still have a credit card where you have to pay a fee for it, then get rid of it. There is no reason for using such cards anymore. As said before, it is never wise to use credit cards. Using cash is a much better option. But if you can’t avoid using them, you better make sure you pay of your debt as soon as possible. The reason why you should avoid using credit cards is the high interest rates that credit cards carry. With the money you pay as interest, you could do a lot other fun things.
