Bank fees: Everything you need to know before switching to a no-fee account
Types of bank fees and the services they provide
The type and amount of fees charged vary by institution, so it’s always important to do your homework. Here are some common and not-so-common fees charged by banks and other financial institutions.
Monthly service fees
This is a flat rate charged each month to keep your account active. You can expect to shell out around $4 for a no-frills account and more for perks like cheques or unlimited transactions. Some accounts require you to maintain a minimum balance at all times or you’ll incur additional fees.
Transactions include deposits, withdrawals, Interac e-Transfers or bill payments—basically, anything that involves moving money through your account. You might think these would be covered in a monthly service fee, but unless you have unlimited transactions (which usually comes at a premium), you’ll pay extra. Transactions completed over your monthly limit usually run around $1 to $1.50 each.
While many banks include ATM transactions in their packages, you’ll typically be charged if you use a machine that’s not in your bank’s network. These may show up as a “Network Access Fee” of around $2 charged by your bank and/or a “Convenience Fee” ($4 to $5) levied by the ATM operator—or both. That’s an extra $6 to $7 for the convenience of using a bank machine.
Lost card fees
If you lose your bank card, replacing it could cost around $5 per card.
Non-sufficient funds (NSF) fees
If you make a withdrawal from your account and you don’t have enough money to cover it, you’ll be charged an NSF fee. These usually run around $35 each. Obviously, you can avoid this by maintaining a positive balance, but many of us at one time or another have written a cheque they forgot about or overestimated our funds. You can avoid this fee by adding overdraft protection (see below) to your account—but that usually comes with a monthly fee, too.
Overdraft protection fees
Setting up overdraft protection (a financial product that covers cheque and debit withdrawals that exceed your account balance so that you avoid non-sufficient fund fees) differs between institutions, but you can usually find a package that only charges you if you use it. The rate may be as low as $5 or $10 per month or more.
Paper statement fees
With most documentation having moved online, it’s no surprise that banks don’t usually automatically offer paper statements anymore. Receiving one can cost you around $5.