Investing and Banking Saving Tips

You can save more than $100 a year in fees by selecting a checking account with a low (or no) minimum balance requirement that you can, and do, meet.

Request a list of these and other fees (including ATM and debit card fees) that are charged on these accounts. Banking institutions often will drop or lower checking fees if paychecks are directly deposited by your employer. Direct deposit offers the additional advantages of convenience, security, and immediate access to your money.

Before opening a savings or investment account with a bank or other
financial institution, find out whether the account is insured by the federal government (FDIC or NCUA). An increasing number of products offered by these institutions, including mutual stock funds and annuities, are not insured.

To earn the highest return on savings (annual percentage yield) with little or no risk, consider certificates of deposit (CDs) or U.S. Savings Bonds (Series I or EE).

Once you select a type of savings or investment product, compare rates and fees offered by different institutions. These rates can vary a lot and, over time, can significantly affect interest earnings.

You probably don't give much thought to the cost of banking: monthly
checking account fees, ATM fees, bounced-check fees, etc., but if you can shave banking expenses, you can put the money in your own pocket. Remember: it's easier to find lots of ways to save a little money than it is to earn more income, and lots of little savings add up. If you're paying for the use of your own money by paying fees to maintain a checking account, look for a bank with no-fee checking. Many banks offer no-fee checking if you keep a minimum balance in a savings account or maintain a minimum combined balance in your savings and checking accounts Get information from several banks and choose the one that best fits your habits. If you always dip below the minimum balance, it does no good to have "free" checking, since you'll incur a fee if your balance goes below the minimum. Potential Savings: $96-120/yr.

Buy your checks through a discounter such as Checks Unlimited
(www.checksunlimited.com)1-800-204-2244; Checks in the Mail
(www.checksinthemail.com)1-800-733-4443, or CheckWorks
(www.checkworks.com)1-800-971-4223. Discounters charge around $6.00 to $8.00
for 200 checks, as opposed to the $20 to $25 your bank charges. Potential Savings: $15-38/yr.
Use only Automated Teller Machines (ATMs) that do not charge a fee. If you withdraw $20 from an ATM and are charged $1.50 by the ATM owner, you have in effect paid a 7 1/2 % surcharge for the use of your own money. Your bank may also charge you an out-of-network transaction fee, doubling the actual cost to you. Potential Savings: $78-156 or more/yr.

Balance your checkbook every month and do not bounce checks. Typical fees for a check written against insufficient funds range from $20 to $35. If more checks clear before you are aware of the problem, you can easily bounce 2 or 3 additional checks for a total cost of $100 or more.

Potential Savings: $100 or more/yr.
If you usually keep a significant balance in an interest bearing bank
account, keep it in a bank that uses the average daily balance method for calculating your minimum balance and interest. You are much less likely to be charged a fee if you dip below the minimum balance at some point during the month (as long as your average daily balance for the entire month is not below the minimum), and you earn interest on all your money. Some other methods of calculating interest can cost you hundreds of dollars a year in interest that would have been credited to your account under the average daily balance method. Potential Savings: $100-300/yr.