Paying bank fees is like setting your money afire, and your bank loves it when you do it. Because whenever you pay fees, you give them free money and you get nothing in return.

And banks are making big bucks. In 2016 alone, America’s three biggest banks — JPMorgan Chase, Bank of America and Wells Fargo — earned more than $6.4 billion from ATM and overdraft fees, according to an analysis by CNNMoney.

ATM Fees – Average Fee $5.57

These are fees you get charged by your bank for the convenience of using an ATM from another bank.

An average rate of $5.57 might not sound like a lot, but don’t let the small sticker price fool you, these fees add up fast. With 40% of ATM users using the ATM 8 – 10 times per month, you could easily end up paying over $60 per month or $720 per year in fees alone.

If you had invested that cash – you could have had $10,430.32 save up in 10 years. That’s a whole lot to give away to the bank. And what’s worse is that you’re likely spending more than that. Because when you use another bank’s ATM, not only does your bank charge you for the convenience, but the ATM’s bank charges you a fee as well for using their ATM.

So for a $10 ATM withdrawal, you could pay $5 to your bank for using an ‘outside’ ATM and another $3.50 to the Bank ATM for not being a customer resulting in your $10 withdrawal costing you $8.50… not cool.

Late Fees

These are fees credit card companies, landlords and other institutions charge when you don’t make your required monthly payments on time. Credit card companies usually hang out around the $35 mark and that number gets added to your principal.

It doesn’t matter if you are 1 day late or 10 days late, most banks tack on your late fee

Account maintenance fees – Average Fee

Seriously, of all the fees this is one of the worst.

Because it makes no stinking sense. So hear me out. Your bank wants to take your money. Give you 0.01% interest yet lend it out other people and charge them up to 29% interest, and then they want to charge you upwards of $12 a month?

So you should pay them so they can make money off your money?

Yeah … no thanks my friends.

My philosophy is you should never pay for the right to use your own money (see above). But unfortunately, so many banks today charge these fees.

Either follow the guidelines to avoid paying the maintenance fee or stick with banks that don’t charge these fees at all.

Speeding Tickets

Now, this one isn’t really a fee per se`, but when it comes to fees that we don’t pay, this is a massive one for me.

Obviously, pay them if you get them, but I try not to get them.

Mostly because it’s just giving away money to your local county.

I love where I live, and I love paying taxes that support my city and school district, but I can think of many better ways to spend $200 – $250 bucks than handing it over to resolve a speeding ticket.

Paper statement fee

In these days, where identity theft is all but certain, basically, everyone should be signed up for electronic statements just to reduce the physical material with their financial and/or private information.

And if information security isn’t super important to you, then at the very least you should consider it to save the $5 per month many companies – banks and utilities alike – charge for the chore of having them print and mail you a paper copy.

The information is the same on the statement and even lasts longer because they can store months and months of statements electronically.

No more plastic bag full of old statements in the back of the closet.

And if you really feel frisky and want to have a physical copy for your records, then you can print it out. Easy peasy.

Wire Transfer Fees

Money transfer fees are a waste of money because they exist at all.

It’s your money, you should be able to move it as you want.

But alas, the world isn’t like that at all. Banks charge anywhere from $20 and higher to issue a wire transfer.

And they still take forever.

In some settings – like buying a house – there isn’t much you can do. Wire transfers are the general rule. But for sending money to friends there are a plethora of other options that are free or significantly cheaper.

Quickpay, Paypal, Venmo to name a few.

And they are just as secure. Save yourself the money and treat yourself to a nice meal and ditch the wire transfer fees.

NSF fees

A non-sufficient funds charge occurs when you write a check for from your bank account or initiate a direct debit (ACH) but you didn’t have enough money to fulfill the check.

When your bank completes the processing of your check only to determine you couldn’t meet the written amount, then your bank might charge you $30 or $40 for a nonsufficient funds fee.

But here’s the kicker again, whoever you wrote the check to their bank is also going to charge them a bounced check fee – around $30 – $40.

So they’re going to get charged because their bank went through all the processing on their end as well to cash your check or to complete your ACH and it was unable to do so.

Most vendors are not going to ‘eat’ the bounced check or non-sufficient funds fee that they are a charge. They’ll likely pass that charge onto you. Some will even add an additional charge since this whole mess was your fault.

So now you have to pay $40 for the nonsufficient fee from your bank and then you get to pay another $30 or $40 or whatever number they decide to give you. That’s almost a hundred dollars right there.

If you had $100, would you be giving it away to people like that?

No, absolutely not.

NSF is just another fee that’s a waste of money which you should avoid.

Bonus: Annual Credit Card Fees

Honestly, I’m hard-pressed to find any credit card that would be worth it to pay an annual fee. However, it all depends on what stage you are in with your finances.

Folks that are financially free are able to justify paying $85 and onwards for a credit card if the benefits received are beyond the cost, but for folks working on building wealth and getting out of debt, this is just another unnecessary expense.

My rule of thumb on annual fees is for a fee to be worth it, I must be able to comfortably and responsibly get at least 3 times that number in value/rewards.

I have yet to see a card meet my standard, but that’s just how I live my life.

I’d love to hear from you

What are some of the fees that you make a plan to never pay? And how do you get around them?

To your success.

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