There are many kinds of chequing and savings accounts, offering a range of services and fees. Make sure you understand the fees you’ll pay before you open an account.
Five ways to lower your account fees:
- Watch how many transactions you make: With some accounts, you can do as many transactions as you like for the same (usually higher) monthly fee. With other accounts, there is a limit on how many transactions you can make for the fee you pay. You will pay more if you go over your limit.
- Use the cheapest method to do your banking: Often, you pay less if you use a bank machine or Internet banking instead of a bank teller. However, there may be extra fees if you pay your bills online.
- Get only the records you really need: If you write cheques and you want to get the cancelled cheques back each month, you will likely pay a fee for this service. You may also pay fees for getting your account balance and for updating your bank book.
- Watch your account balance: Some accounts offer lower fees if you keep a certain amount of money in your account at all times (a minimum balance). You will pay a fee if you make a payment from your account and there is not enough money to cover it. Even worse, your payment will not be honoured. Tip: To avoid this, ask about getting overdraft protection. It works like a loan, but you only pay when you borrow money to cover a payment or withdrawal on your account.
- Ask for special fees based on your age: Some banks may offer special services or rates if you are over a certain age. Some banks also have special accounts for children and teens who are just starting to save.
How can I shop around for lower fees?
First, decide on the services you want. Then, compare the packages and prices that different places offer. On the Internet, you can use special calculators to compare fees and services and pick the best package for you.
Remember: Fees vary for similar accounts and services.
It pays to shop around for the best package you can get from a financial institution that you like and trust.
The Financial Consumer Agency of Canada offers a Cost of Banking Guide. First, you’ll answer some questions about your banking habits, such as the number of cheques you write. Then, the site will generate a list of accounts at different financial institutions that might meet your banking needs.
To compare different accounts at one specific financial institution, try Industry Canada’s Financial Service Charges Calculator.
Content in this section is provided in partnership with the Investor Education Fund, a non-profit organization promoting financial literacy to Canadians. To find out more go to GetSmarterAboutMoney.ca.