Is your bank taking advantage of you? Here are the signs to look out for

This is a guest post from Kalyn Brooke of

Believe it or not, your bank does not always have your best interests at heart.

They are in business to make money, and to make money off your money. From interest rates to extravagant fees, not only are you beholden to the services they provide, they also make it extremely difficult to switch your accounts to a different bank when you finally decide to take the plunge and leave.

Maybe stuffing your cash under a mattress is a viable solution after all!

But in all seriousness, banks are truly a necessity for your finances, and can be very beneficial to help grow {and store} your savings, despite making you jump through hoops to get there. Here are 5 smart ways you can protect yourself right now, and take advantage of your bank, instead of letting it take advantage of you.

Do you trust your town bank?

1. Choose a Small Local Bank

If you’re not banking with a small company, you may want to consider switching to one. Small banks generally work with you to customize their services according to your needs, rather than lump you into a corporate customer base that isn’t personal at all.

Big banks also have more rules, and are less likely to waive fees in defense of business protocol. I have personally worked as a teller for a small local bank, and we operated more on a case-by-case basis. We knew names, faces, and normal account history, and as a result, we had the authority to make better business decisions without a lot of red tape holding us back.

Just make sure the bank you switch to is FDIC insured, which means your cash is protected by the federal government against loss. Not all banks are mandated to offer this, and you definitely want your hard-earned money to be secure!

Learn how to negotiate interest rates with your bank

2. Negotiate Interest Rates

Despite what your banks want you to think, interest rates are negotiable. Perhaps not so much with Certificates of Deposit or Money Management Accounts, but definitely with your Personal Savings.

Stop by your local branch or write a letter saying you’re unhappy with rates on your savings account and compare them to other banks in the area. Doing so may encourage them to boost their rates a little to stay in line with their competitors, and even a half a percent is better than nothing at all.

You also have the option to open up an online savings account {my personal favorite is Capital One 360} to use for a child’s college savings, yearly vacation plans, or even to save for a home remodel. Online accounts generally have much better rates than brick-and-mortar banks, because they don’t need to operate with the same amount of staff, and can leverage their virtual presence.

On the other hand, transfers from an online savings to your personal bank account could take up to 3-5 business days to process, which might be seen as a disadvantage, or make it less tempting to spend. I guess it depends on how you want to look at it!

You should never have to pay for a checking account at your bank

3. Don’t Ever Pay for a Checking Account

For every checking account that comes with a fee, there are 5 others that will actually pay you to open one up with them. This could be a great opportunity to try a new bank and see if you like them, while earning a little bit of extra cash on the side.

If you don’t decide to keep the account, most will let you close them without penalty after a 45-60 day period, but make sure you read the fine print first! Many checking accounts require that you accept e-statements, direct deposits, make a certain number of debit card transactions a month, and maintain a minimum balance before they give you the bonus.

Know what fees your bank charges for ATM withdrawals or cashing checks

4. Know Your Fees

Banks are notorious for their fees, and customers are notorious for not knowing exactly what they are. But can you blame us? It seems like it would be common courtesy to print off a statement, make account transfers, or use a bank ATM, without charging us so much!

But it is our due diligence to research and find out exactly what it costs to use bank services. Be a very careful consumer, and talk to your bank’s customer service representative to understand all fees associated with your account. Keep an eye on all mailings from your bank as well. This is the primary way your bank communicates with you about fee hikes, and you don’t want to be caught unaware because you thought it was junk.

Overdraft protection isn't as good as it sounds - don't be fooled

5. Avoid Overdraft Protection

Overdraft protection sounds pretty good, but it’s actually not. Basically, you are allowing your bank to let you overdraw your account, and then charge you a fee for it. Without this service, they will just decline your debit card, and you won’t be able to make any purchases over and above your balance.

Sure, it can be really embarrassing to find out you don’t have enough to pay for your groceries, especially when you are already in a checkout lane with a couple of overtired kids, but it’s even worse to pay an extra $10-$30 fee just to save you the convenience of not having enough.

Maintain a careful checkbook, and a $100 buffer in your account just to be safe, which will help you avoid this cost all together.

Banks really are not as evil as I make them sound, but they can be if you aren’t fully aware of all their rules and regulations. A bank counts on your ignorance as a consumer, but you can fight back and make sure you know exactly the kind of account, and business relationship, you’re getting into before you ever sign an agreement.

And if you do decide to switch banks, take your time to read all the fine print and talk to friends who have accounts with the bank you’re considering. It certainly depends on what your financial goals are as a family when it comes to choosing a bank that’s right for you. These 5 tips will help you be smart with your decision!

Kalyn Brooke is a life management expert for busy women who crave a simpler and more organized life. Through her recognizable, down-to-earth approach, she provides a daily dose of inspiration and guidance, whether you’re looking for smart money tips, time saving routines, or anything in-between. When she’s not experimenting with ways to do even the most mundane tasks more efficiently, you can find her crafting detailed to-do lists in her bullet journal, or indulging in—yet another—personal development book. Meet Kalyn and learn how stay on top of it all at

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What do you appreciate or dislike about your bank? How do you make sure your bank is not taking advantage of you?

Is your bank taking advantage of you? Here are some things to check and watch out for if you want to trust your bank

Ruth Soukup

Ruth Soukup - LIVING WELL SPENDING LESS. Practical solutions for everyday overwhelm. Food Made Simple, Life Etc., Home 101, Smart Money. Start organizing your whole life today!


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