This blog contains some simple tips and advice from two regular guys. We're not accountants, financial advisors, or brokers, so follow, ignore, or discuss our ideas as you see fit.

Monday, May 12, 2008

Watch For The Fees

Posted By Paul

One thing that drives me crazy is paying fees for things when I don't need to. So I try to keep an eye on my accounts for any kind of account fee.

One thing that happened recently is that I have an eTrade account that I used to buy the occasional mutual fund or stock. I have had it for years and never had to pay an account fee on it. I had to pay a one-time fee if I did a trade of course, but that's pretty common with brokerage accounts.

So not too long ago I decided to liquidate most of my stocks and put the money into a nice simple, safe, savings account. I sold almost all of the stocks and transferred the money into my internet savings account, leaving just a small amount in my eTrade account.

This all worked great until I noticed that my eTrade account started charging me a quarterly account maintenance fee. It turned out that my eTrade account didn't have a maintenance fee as long as I kept a certain balance in it. By transferring money out of my eTrade account into my savings account I had gone under that minimum and so the fee activated.

I have had this eTrade account for years so I honestly don't know if this fee structure is new, or if it was like this when I opened it. The important thing was that by reading my statements I was able to spot the fee and do something about it (in this case I opened up a ShareBuilder account that charges no account fees or minimum for a basic account and transferred everything into that).

Even if you think that you're not paying any fees an your various accounts, I highly recommend doing a quick scan of every statement you receive in the mail (or email) to confirm that belief. You never know which account might have changed its fee structure or which of your balances might have shifted so that you now have a fee associated with it.

It's hard to keep track of all of the mailings talking about changes to your account, but I've noticed that if I give my account statements a quick glance I can catch any "surprise" fees that I might be paying. I may pay the fee once, but I never pay it twice.

1 comment:

Matt said...

In most cases, you don't even need to pay the fees once! When I've encountered similar situations, I simply called the bank (after fixing whatever the underlying problem was, like meeting a balance minumum) and they were almost always willing to credit my account for the fee.