10 Smart ways to avoid or reduce bank fees for children
Several banks offer transactional bank accounts for children but the fees that you can incur for doing the basics with it can be quite high, finds Angelique Ruzicka.
Let’s be honest. Children do what they want to do and it’s difficult to tell them not to do something if they already have it in their head that they want to do ‘X’ and not ‘Y’. However, here is some advice that you can impart to them that will make them thing twice because in essence, if they don’t follow it, they will be poorer. And, even in my short experience of being a parent, no child wants to be without or less when it comes to money.
Here are 10 handy tips that you and your children can follow in order to save money when transacting:
- Try to withdraw money through a participating retailer rather than an ATM. With Nedbank and FNB for example, withdrawing cash at participating retailer’s tillpoints is free. Both allow you four free withdrawals at an ATM per month so if you need cash after your fourth withdrawals it’s best to get it from tillpoints rather.
- If you have to use an ATM to withdraw money, it’s still cheaper to withdraw from your bank’s ATM.
- For balance enquiries you save money if you get your balance electronically (SMS banking, through the bank’s appsuite, or the bank’s own ATM). Generally you pay for balance enquiries if you get them at a branch or another bank’s ATM.
- Ditch the cheque book. Not only is it an outdated mode of banking but nowadays you get penalised heavily for using them. With FNB for example, if you do a cheque deposit at a branch or even at an ATM you pay a whopping R30. So if you did a deposit of R100 you’d only get back R70. And if you use an FNB cheque to make a payment it will cost you R90.
- Use the cheapest payment notification as some are cheaper than others. With FNB for example you pay R0.74 but if you get it via an SMS you pay R1.15.
- Know your deposit thresholds. Absa’s Mega U doesn’t charge you for deposits at branches on balances under R500 but it does on deposits R500 and up. If you use Absa’s ATM to make a deposit then it’s free up to R500, but it is still cheaper to deposit any amount greater than R500 at the ATM.
- If you are travelling with your child remind them that withdrawing cash abroad can be expensive. FNB, for example, charge R50 per international ATM withdrawal and an additional 2.75% commission and conversion fee applies, while with Absa its R50.
- If, for some reason your child needs to cancel a debit order rather get them to use online or mobile channels to do so. Using telephone banking with consultants or doing so over the counter is far more expensive.
- Teach your child to be responsible with their bank card. Replacements cost R80 with FNB and R52, 50 for a magstrip card and R130 for a chip debit card with Standard Bank.
- If your child wants to transfer funds get them to do so online, through cellphone or telephone banking or an ATM. There’s no charge with Absa if you use these channels but it does charge R50 if you transfer funds at a branch counter.
For more on how to transact wisely, check out our comparison article on child transactional bank accounts to find the right one for your child.