Banking and Account Fees:
Why They Must Be
Important to Millennials
Banks, many of which are trying to grow their profits, recoup profits lost from low-interest rates, mortgage lending, and the cost of doing business, have fees on many of their services ...
Those service fees that I as a Mortgage Originator see come into play most often for my Mortgage clients often "fly under the radar", meaning they often go undetected or are paid little attention.
Those two service fees?
ATM Fees and Overdraft Fees.
These two fees can mount up quickly for an account-holder. They're sneaky. Too often they are dismissed as small and inconsequential, when in reality ... the monthly costs can become considerable.
I can't tell you how many times I've come into possession of a mortgage applicant's bank statement that shows ATM Fee after ATM Fee for fairly minor withdrawals. The convenience of stopping at out-of-network ATMs is really costing them, sometimes almost as much as $5.00 per withdrawal.
One or two of these ATM fees has been charged every week. Week after week. Sometimes contributing to tipping their account into overdraft. Overdraft fees (or minimum balance fees) have then kicked-in. It's a vicious cycle.
Again, these fees can be voracious. Eating away at savings and devouring funds.
So why do I bring this topic up? And why is it important?
Recently I wrote a post about the Millennial Generation's aversion to credit and credit cards. Within that post, I quoted a statistic that reported that 63% of Millennials have NO Credit Card.
Note: The ATM fees in the cities of Phoenix, Milwaukee, Seattle, Denver, Houston, Minneapolis (many of which are Millennial-centric populations) are the highest found across our nation.
Many Millennials rely largely on cash and Debit Cards. That means they are using ATMs and subject to ATM Fees and potentially Overdraft Fees too in larger number.
Connect the following dots ...
Banking Fees, including ATM Fees and Overdraft Fees, can slow the rate at which Millennials save. If these fees are not kept in check, they can become a roadblock to saving just like Credit Cards can. You just exchange one "evil" for another.
We all must be educated and aware of the fees associated with the accounts we hold at banks, but given the heavy reliance Millennials place on Debit Cards, they must remain particularly vigilant of their accounts and the fees attributed to them. This becomes especially important when the decision has been made to pursue the purchase of a home.
I raise a cautionary red flag for those Millennials considering a purchase of a home in their future ...
If truly hoping to avoid the fees, costs, and pitfalls you associate with credit cards: Check your monthly account statements. Be aware of any ATM or service fees being charged above and beyond the mandatory fees for those accounts.
Plan ahead. Budget for account withdrawals so you avoid extra ATM Fees and Overdraft costs. It will be the shortest and fastest route to savings and the home you're dreaming of.
* Hoping to Buy, Build, or Refinance a home in the greater Chicagoland area? Contact Me today! I'll put my 40 years of Mortgage experience and expertise hard to work on your behalf.
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Gene Mundt, Mortgage Originator, an Originator with 40 years of mortgage experience, will offer you exemplary mortgage service and advice when seeking: Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in Chicago and the greater Chicagoland region, including: The Lincoln-Way Area, Will County, (New Lenox, Frankfort, Mokena, Manhattan, Joliet, Shorewood, Crest Hill, Plainfield, Bolingbrook, Romeoville, Naperville, etc.), DuPage County, the City of Chicago, Cook County, and elsewhere within IL & WI.