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5 tips to beat the banks
1
Don't make five
$20 bank machine withdrawals. Take out a lump
sum of $200.
2
Most low-fee accounts demand a minimum monthly
balance to waive bank fees (from between $1,000
to $5,000). That money could be earning higher
interest elsewhere. Pay the monthly fee and save
on extra fees by keeping your transactions to
a minimum.
3
Restrict withdrawals to your own bank's machines.
4
Use your credit card instead of debit for
store purchases and pay it off each month. But
don't do this if you're already carrying a big
balance.
5
If you must debit, combine a purchase with
cashback to get the most out of a transaction.
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Bank fees can hit your wallet hard
— sometimes sucking out $30 or even more each month,
often without you even noticing. Physicians are too
busy to take the time to shop around for an account
that fits their lifestyle, so chances are you're spending
much more than you need to. Doctor, it's time to stop
contributing to those billion dollar bank profits.
Our guide will let you in on strategies
to beat bank and bank machine fees while keeping your
money where it should be — in your wallet.
ACCOUNT
FEES
It's much easier — not to mention safer —
to carry around a debit card than a wad of rolled up
bills, so many physicians prefer to make debit purchases
and carry small amounts of cash.
But that's where the banks really
get you. The cheapest chequing accounts only offer a
limited number of uncharged transactions before billing
you a dollar or more every time you make one. If you're
the type to use your debit card for every chocolate
bar or newspaper purchase, you're surely being fleeced.
To find an account that fits the
way you spend, check out the Financial Consumer Agency
of Canada's online account finder — it's a small
questionnaire that evaluates your needs and picks an
account that's right for you (www.fcac-acfc.gc.ca/eng/consumers/ITools/CoB/default.asp).
Avoid pricey unlimited transaction plans, though, as
they can cost you over $140 a year.
RAGE
AGAINST MACHINE
When you use another bank's machine you may turn a blind
eye to the $1.50 to $3.00 you're being charged. Don't!
These fees add up. One clear strategy is to stay away
from no-name ATMs and only visit your own bank.
Many stores also offer 'cash back,'
a debit arrangement where you ask the store for an additional
amount charged on top of your purchase, which is then
given to you as though it were a withdrawal. Using 'cash
back' you can lump a withdrawal and purchase together
as a single transaction.
VIRTUAL
BANKS
After you've set up your low-fee chequing account and
started using the strategies to save your cash, you
may want to squirrel away some of that dough in a high-interest
savings account at one of Canada's online banks.
Why an online bank? Unlike most
regular savings accounts, which only offer about 2.5%
interest, virtual banks, like ING Direct, HSBC Direct
and the Citizens Bank of Canada, offer 3% to 3.15% interest
on your savings without any fees. President's Choice
has a no-fee chequing account with unlimited transactions.
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PHYSICIAN LIFE
