In order to be financially literate, you have to understand all of the expenses and fees associated with your accounts. Many banks will charge fees for things like monthly maintenance, overdrafts, and wire transfers. While you may not be charged these fees often, you still need to be aware of the possibility of incurring them so that you will be prepared when they do incurr.
Monthly Account Maintenance Fees
A Monthly Account Maintenance Fee is the most common charge you’ll find in checking and savings accounts. This fee is typically between $15 and $20 per month, but is often waived by banks as long as you keep a minimum balance.
At Encore Bank, our Essential Checking Account is free of fees, and our Premier Checking Account fee can be waived if your daily balance stays over $1,000. If your balance falls below the $1,000 threshold, our fee is only $10, making it less than our competitors. As for Savings Accounts, a traditional savings account at Encore Bank charges a $5 service fee per quarter if your balance falls below $100.
Overdraft and NSF Fees
An overdraft fee can occur when you overspend on your account, or “bounce a check.” Not all transactions are covered by overdraft portection. If it is covered, you will be charged an overdraft fee. If it is not covered, you may still be charged a non-sufficient funds (NSF) fee. The average overdraft fee is around $30, but can be anywhere from $10 to $50 depending on your bank. If it was a bill or a creditor, they may also charge you a fee in addition to the one from your bank.
Transfer fees can occur when you’re sending money from one account to another, whether it be from your savings account to your checking account, or to a completely different account. Each bank will have their own set of transfer fees, so it’s important to ask what those fees may be before starting a transfer.
At Encore Bank, you are given six withdrawals or transfers from your savings account per month, with a $1 service fee per transfer occurring once that threshold is passed. In order to avoid these fees, make sure you are not transferring beyond your six transfers.
Out of Network ATM Fees
Out of Network ATM fees may be charged when you withdraw money from an ATM that does not belong to your bank. The owner of the ATM along with your personal bank might charge a fee ranging from $2 to $3.50 per withdrawal. Some banks offer no-charge ATM withdrawals or a rebate up to a certain amount, so check with your bank regarding their policy on this.
Encore Bank does not charge a fee for using an Out of Network ATM in the United States.
Wire Transfer Fees
Wire transfers happen faster than traditional transfers, but they are also more expensive. These fees may range anywhere between $15 to almost $50 per transfer, but for larger transactions that need to happen quickly, they are a beneficial tool.
Account Closing Fees
Many banks will not charge an account closing fee as long as you’ve had the account for a specified time, but closing an account too early can result in a fee. Before you open an account with a bank, determine if the time required to keep the account open without being charged an account closing fee will line up with your timeline.
Overall, knowing what fees you may be charged throughout your banking experience is essential to becoming financially literate. Many brick-and-mortar banks are conveniently located a short drive away, but these banks often come with large fees. On the other hand, primarily online banks often have smaller or no fees for their accounts.