Lately there’s a lot in the news about checking accounts and debit card fees. So, I thought this would be a good time to take a look at checking account features.
A recent survey by The New York Times found that the average bounced check fee is now $30.83, which is a record. In addition, many banks are abandoning their free checking account option, but may offer accounts that allow customers to avoid fees by maintaining a certain balance or by electing for direct deposit. When shopping for a checking account, watch for account features that should raise “red flags,” such as the inability to link the account with a savings account or overdraft fees on debit card transactions. To help service members avoid excessive fees, encourage clients to ask about the specific features of an account before moving their business to a new bank. The Center for Responsible Lending offers banking and lending resources.
However, this guide doesn’t address the recent trend in debit card usage fees. What are you hearing about debit card fees? Bank of America has taken a lot of flack for their $5 debit card fees, but many other banks have already instituted fees or are considering implementing fees in the future.
Fortunately, service members and other consumers have other options. Opening an account with a credit union and smaller community bank is often the first step toward avoiding or reducing banking fees. Regardless of the advantage of avoiding fees, research has shown consumers are often hesitant to change banks because they have become accustomed to how a bank operates, even if they don’t care for the fees associated with services. As more users move to online banking, the thought of switching over all their online accounts may seem like more trouble than it’s worth. However, a closer look at how quickly these fees add up might make it worth the annoyance; like the 3,200 people who decided to become new customers at Navy Federal Credit Union. Earlier this month, the Navy Federal Credit Union reported 3,200 new accounts opened in just one weekend. Many new customers had left behind banks that now charging debit card fees.
Are your clients paying these fees or changing financial institutions to avoid fees?
Beyond debit card fees, what are the features we need to look for when shopping for a transaction account?
What are the features likely to get an account holder into trouble?