checking

Checking account do's and don'ts

If you are over the age of 16, it is very likely that you have your own personal checking account. Checking accounts are extremely common; however, some people still have a hard time managing them. From overdraft fees to ATM fees, there are numerous avoidable charges and ways to get the best from your checking account.

Don't opt-in for overdraft protection without collateral

Overdraft protection has been a courtesy of most banks, which allows you to purchase items or withdraw money using your debit card, even if you don't have any funds in your account. Unfortunately, they tack on a pricey $30 or more fee per overdraft occurrence. This courtesy is really more of a punishment for consumers who don't balance their checking accounts or don't have collateral in a savings account, home equity line of credit or credit card.

During the summer of 2010, this automatic overdraft protection will be removed and bank customers will have to opt-in for this protection. If you aren't afraid of being denied when purchasing or withdrawing money, don't opt-in; it can save you a lot of money if you don't have collateral and are bad at balancing your checking account.

Do get a free checking account

Based on Bankrate.com's 2009 survey, 76 percent of checking accounts are considered free, meaning there isn't a minimum balance required or "per item" fees. If you are doing basic checking tasks like using a debit card or writing checks, get a basic free checking account.

Don't bounce checks

Keeping up with checks can be confusing if you don't balance a checkbook, but it's imperative to avoid bouncing checks. Overdrawing your account is expensive and is easily avoidable if you keep a close eye on your checking account and keep records of outgoing checks. See if your bank has automatic check payment options so funds are automatically withdrawn from your account, even if the recipient hasn't deposited the check.

Do seek a bank with waived ATM fees

Some banks are offering free ATM withdrawal from any ATM in the country. If you can find a bank offering free ATM fees nationwide, consider opening a free checking account with them as long as there aren't any hidden fees or consequences. ATM fees can be costly if you are using a local or regional bank, so waived ATM fees help reduce unnecessary charges.

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