If you live in a small, rural community, you may have the distinct honor of never paying any bank service fees. If you are not that fortunate, however, read on.
If you are paying bank service charges, and have never negotiated those charges, it is likely you are being overcharged. The fact of the matter is that all bank services are negotiable.
Here are six common ways to significantly reduce the cost of banking:
Checking account fees – Consolidate accounts, then negotiate out of any and all fees. If you can’t negotiate out of all fees, negotiate custom pricing on specific high-charge items.
Loan Fees – In this day and age, there are multiple lenders wanting you to borrow from them. Refuse to pay fees. Lenders know you can take your business elsewhere if they play hardball.
Cash Management Fees – Although banks have stated rates, they waive or reduce fees for “good” customers. Most marketers have millions running through their bank accounts each year. By sheer volume alone, you deserve their best rates.
Payroll Processing – This is another service with a huge mark-up. Negotiate discounts off posted rates. Discounts of 25% to 50% of posted prices is common.
Trust and Investment Fees – Yes, another high mark-up item. And, yes, all these fees are negotiable and waivable.
On-site PC processing – Most banks have gone on-line, but they try to charge exorbitant fees for you to have this privilege. Don’t buy their pitch. You are doing them a favor when you go on-line.
To obtain the best discounts, bid out all of your banking needs. We are too much in the habit of only selecting banks by loan rates. Instead, we should analyze the entire cost of doing business with our financial institution.
Expect deeper discounts on bank services by giving them all of your business. This is not to say you shouldn’t keep them honest through the bid proposal system. It’s just that a bank can be more competitive the larger the share of your business you throw their way.
As you negotiate with your bank to lower the cost of doing business with them, be alert to new products or services that will save you money. A good banker should always bring new cash/loan management ideas to the table.
Finally, remember that banking is a bit of a game. The bank’s goal is to make as much money from you as they can. Your part in the game is to make sure they don’t!
