This post may contain affiliate links. Please read my disclosure for more information.
Are you tired of the high fees and low interest rates that come with traditional banking? Do you feel like the banks are always finding ways to take more money from you?
If so, you’re not alone. Many people are looking for ways to beat the banks and keep more of their hard-earned money.
The good news is that there are ways to beat the banks at their own game. By being smart with your money and taking advantage of the many alternatives to traditional banking, you can keep more of your money in your pocket.
In this article, we’ll explore some of the best ways to beat the bank and take control of your finances.
Whether you’re looking to save money on fees, earn more interest on your savings, or find new ways to invest your money, we’ve got you covered.
So, sit back, relax, and get ready to learn how to beat the banks and keep more of your money where it belongs – in your wallet.
8 Tips on How to Beat the Banks
Banks have been around for centuries, but they have evolved significantly over time. In the past, banks were primarily focused on providing basic financial services like holding deposits and making loans.
However, as the economy has grown, so have the services that banks provide. Today, banks offer a wide range of financial services, including investment banking, insurance, and wealth management.
Here are some tips on how to beat the banks at their own game for any of the financial products and services you use with them.
Related reading:
- Why Can’t I Save Money?
- How to Save $3,000 in 3 Months
- Needs and Wants in a Budget
- Books on Financial Freedom.
1. Shop around and research what other banks offer
You already know it pays to shop around when buying products and goods, but did you know the same is true with banks?
You should shop around to find the best deals and the right bank or mortgage for you. Many banks now offer sign up cash bonuses to open an account.
Opening an account with this link to SoFi will get you as much as $275!
You can also make sure that the bank you choose does not have minimum balance requirements for your checking account. That way you don’t ever have to pay fees if your balance falls short.
Another way to beat the banks is by shopping around for the best interest rate. When it comes to your savings account, you should be earning money each month.
A high yield savings account will help you do that.
In addition, when it comes to a mortgage, shopping around might help you find lower interest rates and consequently lower monthly payments!
One of the advantages to banking today is the possibility of online banks. Online banks have become increasingly popular in recent years, and for good reason.
These banks offer a range of benefits that traditional banks simply cannot match. For example, they often have lower fees, higher interest rates, and more flexible account options.
Additionally, online banks are accessible from anywhere in the world, making them ideal for people who travel frequently or live in remote locations.
Some of the most popular online banks include Apple Bank, Google Bank, Discover and many others. These banks offer mobile apps that allow you to manage your finances on the go.
They also offer innovative products such as cryptocurrency and digital assets, which traditional banks do not offer.
Earn Interest on Your Money
CIT Bank: Make money while you sleep with a high yield savings account.
2. Have Multiple Accounts
There is no reason why you have to stick with just one bank to do all your banking! Having different accounts at different banks can be an advantage.
As we mentioned, the presence of online banks brings advantages. Maybe you should have a high yield savings account online, while your checking account is with a local, in-person bank.
You can have a different account for each of your sinking fund categories. Or start one just for the purpose of saving $5,000 with the nickel challenge.
You could have your retirement accounts somewhere else! Take advantage of bonuses and offers, interest rates and lower fees and have multiple accounts to beat the banks at their own game.
And again, make sure you choose accounts with no maintenance fees.
Make Your Savings Earn More with a High Yield Savings Account
SoFi: Earn a $275 bonus by opening a checking and savings account with SofI. Plus, earn interest on your savings. Join now!
CIT Bank: Earn as much as 4.6% in interest each month on a Savings Connect account from CIT Bank. They were ranked best in customer experience in 2022. Open an account.
3. Make Extra Payments
When it comes to your mortgage, that is the single biggest financial relationship you might have with a bank.
And the bank will make a TON of money off you over the life of the mortgage. But, you can take them at their own game by making extra payments.
Every time you make an extra mortgage payment, it reduces the amount of years of your loan and changes the amortization schedule.
Shaving years off your loan means saving money on interest fees. A lot of money! So make extra payments and keep more money in your pocket instead of the bank’s.
Another similar strategy you can try is called velocity banking.
4. Avoid Banking Fees
The last thing you want to do is pay any of your hard earned money to banks. With so many banking options available now, there is no need to!
Find banks that won’t charge you account maintenance fees or require a minimum balance. In addition, don’t let your account ever get overdrawn.
Withdrawal fees and bounce charges can be very expensive. Have your checking account tied to a savings account to protect it from being overdrawn.
5. Negotiate Terms, Rates and Fees
Negotiation is an often overlooked financial tool. When it comes to loans, rate of returns on your money and fees, you can negotiate with banks.
Talk with your bankers and figure out how to keep more of your cash in your own pocket. Don’t just accept the first thing they tell you.
The same is true for things like retirement savings accounts, mutual funds and mortgages. Stop paying more money than you have to!
Make the Most of Your Money
Empower: Get the money management tool to help you control your personal finances. Net worth, future plans, savings planner, and investments, all in one award-winning dashboard.
6. Leverage Tech-Driven Financial Products
Technology has played a significant role in the development of new financial products. For example, mobile apps have made it easier than ever before to manage your finances on the go.
Additionally, the rise of cryptocurrency and digital assets has created new investment opportunities for people around the world.
Innovation in the banking industry is showing no signs of slowing down. As technology continues to evolve, we can expect to see even more exciting developments in the world of digital banking.
For example, you can use an app like Acorns to automatically save your money for you. Plus, it invests it into the stock market so it earns while you save.
Automating your savings like that can help you budget for unexpected expenses.
Look for banks that have features like mobile check deposit, online bill pay, and budgeting tools. These tech tools will make it easier for you to manage your finances from anywhere.
7. Try Alternative Banking Options
If you’re tired of the high fees and low returns that traditional banks offer, there are alternative banking options available that can help you beat the banks at their own game.
Credit unions are a great option for those looking to beat the banks. They are member-owned and operated, which means they are not-for-profit and can offer lower fees and higher interest rates on savings accounts and loans.
Plus, credit unions often have a more personal touch, with a focus on community involvement and member satisfaction.
Another alternative to traditional banks is fintech companies. These companies use technology to offer innovative financial products and services that can help you save money and earn higher returns.
For example, PayPal offers a high-yield savings account with no fees and a competitive interest rate.
Other fintech companies like CAMP and Catch-Up offer cashback rewards and savings tools that can help you reach your financial goals faster.
8. Invest Your Money to Make More Money
When it comes to beating the banks, one of the best things you can do is invest your money wisely to build wealth. Here are a few investment strategies to consider:
Buying Stocks and Bonds
Stocks and bonds are two of the most common types of investments. Stocks represent ownership in a company, while bonds represent a loan made to a company or government. Both can be profitable, but they come with different levels of risk.
To get started with stocks and bonds, you can open an account with a brokerage firm. Some popular options include Fidelity, Charles Schwab, and E*TRADE.
Tools you need to get started investing in the stock market:
Open a free investing account with SoFi. Sign up with this link and get $25 in free stock just for signing up!
Motley Fool will give you insider information and tips on what stocks to buy.
VectorVest: Stock analysis to help you know what to buy and what to sell!
Diversify Your Portfolio
Another important investment strategy is diversification. This means spreading your money across different types of investments, such as stocks, bonds, mutual funds and even crypto assets like Bitcoin.
By diversifying, you can reduce your risk and potentially increase your returns. Invest in different assets like real estate, or startups. You can even invest in fine art with Masterworks.
What to Look For in a Good Bank
Here are some tips to finding the best bank for you.
Customer Centric
Customer-centric banks are focused on improving the overall experience of their customers. This includes everything from making it easier to open accounts and deposit money, to providing personalized recommendations and advice.
By prioritizing the customer experience, these banks are able to build stronger relationships with their customers and keep them coming back.
Personalization and Engagement
Another key aspect of a good bank is personalization. These banks use data and analytics to better understand their customers’ needs and preferences, and then tailor their services accordingly.
This can include personalized offers for loans or credit cards, or recommendations for savings accounts that fit your specific goals.
Customer-centric banks also prioritize engagement with their customers. This can include regular check-ins to see how you’re doing financially, or providing educational resources to help you make better financial decisions.
Better Interest Rates and Low Fees
Look for a bank with the highest yield interest rate on savings accounts, CDs and anything else that allows you to make money. Finding a bank with a wealth management program is valuable as well.
Finding a bank with a much higher interest rate return is worthwhile. Conversely, when it comes to loans and mortgages, look for the lowest interest, fees and best terms.
Personal Finance Basics
When it comes to beating the banks, it all starts with understanding personal finance basics. This means taking control of your finances and setting yourself up for success.
Here are two important areas to focus on:
Setting Financial Goals
The first step in managing your personal finances is to set financial goals. This can include saving for a down payment on a house, paying off credit card debt, or building an emergency fund.
Whatever your goals may be, it’s important to have a clear idea of what you want to achieve and when you want to achieve it.
To help you set and achieve your financial goals, you can use tools like budgeting printables or a money management tool like Empower.
These tools can help you track your spending, create a budget, and make sure you’re on track to meet your financial goals.
Budgeting and Saving
Once you have your financial goals in place, the next step is to create a budget and start saving.
A budget is simply a plan for your money that helps you prioritize your spending and make sure you’re not overspending in any one area.
To create a budget, start by listing all of your monthly expenses, including rent or mortgage payments, utilities, groceries, transportation, and any other bills you may have.
Then, subtract your expenses from your income to see how much money you have left over each month.
Here are some popular budgeting strategies to use:
With your budget in place, you can start saving money by opening a savings account or investing in an IRA.
Frequently Asked Questions
Credit unions are not-for-profit organizations that are owned by their members. This means that they typically offer higher interest rates on savings accounts and lower fees on loans and credit cards compared to traditional banks.
To maximize your savings with a credit union, look for one that offers high-yield savings accounts, competitive CD rates, and low or no fees.
The largest bank in the world right now is Industrial and Commercial Bank of China (ICBC), with over $4 trillion in assets.
While it may be tempting to choose a bank based on its size and global reach, it’s important to also consider factors like fees, interest rates, and customer service when choosing a bank.
There is no limit to the number of bank accounts you can have, but it’s important to keep in mind that managing multiple accounts can be time-consuming and may result in fees if you don’t meet minimum balance requirements. Consider consolidating your accounts or using a budgeting app to keep track of your finances.
According to a recent survey by the American Customer Satisfaction Index (ACSI), the government-owned bank with the highest customer satisfaction rating is USAA Federal Savings Bank.
Other government-owned banks such as Navy Federal Credit Union and Pentagon Federal Credit Union also scored high marks in the survey.
Effective strategies for managing personal finance without relying on big banks include using credit unions, online banks, and fintech apps.
These alternatives often offer lower fees, higher interest rates, and more personalized customer service compared to big banks. Additionally, creating a budget, automating savings, and paying off debt can help you take control of your finances.
Final Thoughts on Beating Banks At Their Own Game
Use these tips and maximize your money! You can beat the banks by shopping around, using digital tools and alternate banking like FinTech and Credit Unions.
Aim for the best deals and return on your money and keep investing wisely!