If you don't have a bank
account, you might be dealing with check cashers, money transfer companies or
Below are common fees that can be minimized or even disappear when you open a
basic bank account.
Cash Advance Fee When you need
cash and don't have access to your savings, you may decide to use your credit
card to get a cash advance from an Automated Teller Machine (ATM). Your
credit card company will charge you a fee for this transaction plus you will
have to pay interest.
Bank account advantage: If you have a bank account, you
can access your money from any ATM, though we recommend you use your own
bank's ATM to avoid fees.
Check Cashing Fee Using a check casher
to cash your paycheck comes at a cost. According to the New York State
Banking Department, check cashers are not allowed to charge fees over
1.64%. For a list of check cashers supervised by the Department,
Bank account advantage: You can deposit and/or cash
checks for free if you have a bank account. Please
note: Monthly service fees may apply depending on the type of bank
account you have. If you don't want to wait in line to cash or deposit
your checks, ask your bank and employer about arranging direct deposit - a
program that deposits your paycheck electronically into the account you
Bill Payment and Money Order
Fees Without a bank account, you likely rely on check cashers,
telephone bill pay (which has a fee attached to it), or money orders (which
generally cost $1.05 to $1.50 if purchased at the post office) to pay your
bills. These fees can be easily avoided if you had a bank
Bank account advantage: A checking account allows you to
write checks for free or at a low cost to make bill payments. In
addition, many banks now offer online banking services so you can pay bills
electronically through vendors' and lenders' Web sites.
Money Transfer / Wiring Fee If you use
a money transfer company to wire money to another person's account, it will cost
you a fee, usually a percentage of the amount you wish to transfer.
Depending on the amount you wish to transfer, fees can be quite expensive.
Bank account advantage: If you wire money from your bank
account to another person's account, the bank will usually charge a flat rate
that is generally lower than a money transfer company. Some banks offer
an account with two ATM cards so that a person in Country A can deposit money
into the account from which the person in Country B can withdraw assuming the
bank has branches in both countries.