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How to bank on the cheap

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Sunday, March 31, 2013, 9:00 p.m.

If you have free checking, take a closer look at your statement. You might discover that your account is actually costing you money.

Last year, consumers paid a whopping $34 billion in checking fees. Nearly 30 percent of consumers admitted to overdrawing their accounts during a two-year period, and 10 percent said they had at least four overdrafts during the two years, according to Raddon Financial Group, which tracks banking behaviors.

Read the fine print: Check the bank's fee schedule — online or at a branch — and crunch the numbers for a typical month before opening an account at any bank.

Choose wisely: “You need to think about what you will use the account for and what you want in the way of bank services,” said Diana Scavone, senior vice president of PNC Bank's tricounty regional area, which includes Pennsylvania.

The best way to understand just what you are getting in return for depositing your money in a particular bank is to go into the bank and talk to a customer service representative. If the bank offers free checking, for example, a better choice might be an account with a monthly minimum.

Some banks offer specialized free accounts. The account holder doesn't have to keep a minimum balance, but monthly limits on checks and transactions at non-bank ATMs might be a requirement. PNC, for example, offers virtual wallet accounts for adults and students, and both are free accounts if you don't go over the limits on check writing and ATM withdrawals.

Interest matters: Some checking accounts offer interest, but you may have to play by certain rules, such as using your debit card so many times per month or having direct deposit. Visit to find a bank servicing Pennsylvania which allows distance banking, including online banking, mail deposits and ATM fee refunds.

Other ways to save:

Using non-bank ATMs can become costly, so, if you travel out of the area often, you might want to find a bank with branches where you travel, or one that reimburses ATM fees.

• Decline overdraft protection. If you have already signed up, you can contact your bank to opt out. Your debit card will be declined if you exceed your balance, but you won't have an overdraft fee.

• Avoid bouncing checks or overdraft fees each month. The $20 to $30 you save by not bouncing a check each month would save you enough money to nearly fully fund a $500 emergency savings account.

• Reduce credit card debt by $1,000. That $1,000 debt reduction will probably save you $150 to $200 a year, and much more if you're paying penalty rates of 20 to 30 percent.

• Make your monthly credit-card payment on time. The $30 to $35 you save by not being charged a late fee each month on one card would save you most of the money you need for $500 in emergency savings.

— Pocono Record, Stroudsburg, Pa.

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