The pandemic has disproportionately impacted low-earning Americans and many are paying higher bank fees for their misfortune, according to a new survey.
Those financially hurt by COVID-19 are paying checking account fees that are four times higher than unaffected households with uninterrupted employment and income, a new Bankrate survey found. YouGov interviewed 2,743 adults online from Dec. 2-4 on behalf of Bankrate.
Those who have reported having financial hardship during the pandemic said they pay monthly checking account fees of $11.41, while those who have better weathered the pandemic unscathed are paying about $2.71 per month.
Minorities and millennials — two groups that have suffered high rates of unemployment and income loss since March 2020 — reported paying the highest bank fees.
How to avoid bank fees
Many banking institutions may waive fees or interest if you contact them to report a financial hardship. It’s always best to get in touch as soon as your income is impacted and before you incur an overdraft fee or other penalty.
It also is important to avoid poor money management. Make sure you are establishing a budget using bucket strategies, and spreading out your bill payment deadlines if you find yourself strapped with cash all at one period. You can ask lenders about the possibility to reschedule these deadlines if necessary.You can also consider linking a checking account to a savings account that can be drawn from if you overdraft as a backstop. Avoid overdrafting your account at all costs and seek financial institutions that will work with you and match your needs. Make sure to check interest rates before opening your account in order to maximize high yield returns. If your current accounts are hitting you with high fees, seek out help and assistance from a financial professional or institution to help you find the right place. If you have any questions, please feel free to schedule a complimentary 30-minute consultation on our site here.