banking-tips

12 Tips you have to know about banking

Information verified correct on December 5th, 2016

Making a few sensible choices with your banking can save you money.

Banking can be easy. When you put your money into a bank, that doesn’t mean you can neglect it. It’s your money, so you should know how it’s being looked after. Managing your money can be easy and stress-free if you educate yourself with the following tips.

Tip 1: Know the three most common types of accounts

There are several types of accounts banks offer in Australia. The three major accounts are transaction accounts, savings accounts and joint accounts. Transaction accounts are used for everyday spending purposes. Savings accounts are designed to help you save faster and reach your savings goals quicker. Joint accounts are one account but with two names on it.

Before choosing a bank, check what sort of accounts it offers and whether it suits your needs. For example, if you’re trying to save money for your children’s education, a savings account would be more appropriate than a transaction or joint account.

Tip 2: Know your account like the back of your hand

Certain ways you use your account will determine the amount of fees you pay. Direct debits are useful when paying continual installments such as bills and loan repayments. Direct debits can be automatic payments that are set up and controlled by you. However, make sure you have the right amount of funds to make the payment otherwise you could fall into debt.

There are different ways to pay and knowing the details could save you money. Cash is the cheapest way to pay since you know exactly how much you are handing over. Other forms of payment like credit cards and EFTPOS could have extra fees attached which don’t apply to cash.

Most people pay by EFTPOS. It is certainly one of the most convenient ways of paying. However, some banks charge a fee every time you use EFTPOS and that can add up to a serious amount over a year.

Tip 3: Beware of the EFTPOS chargeback

Selecting the “credit” option rather than “savings” or “cheque” can give you extra protection on your purchases depending on the terms and conditions of your bank account. A chargeback is the return of money from a retailer or service provider to your bank account. However, this service depends on the circumstances so check with your bank if it offers this service.

Tip 4: ATM fees are getting more expensive, but they are completely avoidable both in Australia and overseas

If you use an ATM that isn’t provided by your bank, you will be hit with a fee, so choosing a bank account with a large ATM network always helps. Compare the following ATM fees and charges for Australia’s big banks. If you use an ATM out of Australia that isn’t provided by your bank or one of it’s partners, you’ll be charged by two fees: an international transaction fee and a overseas ATM fee, so choosing an international bank account also helps.

Rates last updated December 5th, 2016
$
Monthly Account Fee Debit Card Access ATM Withdrawal Fee Fee Free Deposit p.m. Details
St.George Complete Freedom Account
10% Cash back for online gaming purchases.
Waived account keeping fees when minimum deposit is met with no minimum balance.
Visa $0 $2,000 No account keeping fees, if you deposit $2,000 per month plus no minimum balance required. No ATM fees when using St.George, Westpac and BankSA ATMs. Open More
Citibank Plus Everyday Account
Free international money transfers and free overseas Citibank ATM withdrawals.
Visa $0 $0 No ATM fees using Citibank, Westpac, BankSA and St.George branded ATMs in Australia. Use overseas Citibank ATMs for free. More

Tip 5: Protect your debit and credit cards

Stolen debit and credit cards are a big risk in Australian society. It is very easy for cards to be swiped or misplaced, especially during a night out. Thieves can use the magnetic strip to get your information and the PIN code to manufacture a fraudulent card. MasterCard and Visa both promise zero liability on both credit and debit cards. However, you must demonstrate that you have used reasonable care in protecting your card from theft or loss.

So to protect your card, when given the option, select “credit” over “savings” or “cheque”. Choose an ATM provided by your bank. It will have security cameras to help the bank track down your card if you lose it or if it is stolen.

Tip 6: Compare BPAY fees

A lot of stores and businesses allow you to pay online through your bank. This is known as BPAY. Most banks charge a fee for each time you use BPAY manually, so if you want to avoid this fee you should use BPAY online. Compare the rates with other banks to make sure you get the best deal. Normally, you can’t get a chargeback if you’ve made a BPAY payment.

Tip 7: Be careful about overdrafts

An overdraft is just another form of credit, attracting interest, fees and charges. It is often used for short-term needs such as having money in your account to cover bank fees. When an overdraft is used, some banks charge a fee of $30 and interest on the overdrawn amount. Other banks will not charge you if it’s your first time taking an overdraft others have done away with the overdraft fee altogether.

Here are some things to watch out for with overdrafts:

  • An establishment fee.
  • A monthly or quarterly service fee.
  • Interest on the amount borrowed (usually higher than the average personal lending rate).
  • A fee if you go over your agreed overdraft limit.
  • “Inaccurate” ATM balances. ATMs will allow you to take out more money than you have in your account making it very easy to overdraft without realising. Also, recent transactions may take a few days to process, so they won’t show up on your account giving you “inaccurate” balances.

Tip 8: Check the Banking State Branch

The Banking State Branch (BSB) is the number in front of your account number and is often the Australian version of IBAN. If you transfer money to different accounts through online banking, check the BSB and account numbers to make sure you’re not transferring money to the wrong person or company.

Tip 9: Know what makes each financial institution different

Every bank has different interest rates, fees and charges depending on the account you choose to open. In order to get the best of the best, compare what each bank has to offer. Go with an account that will benefit your goals. Open both a savings and bank account so you can use one and save on the other. Explore and research your options.

Tip 10: Your bank can give you cash for doing what you usually do

Offering cash back with purchases used to be one of the ways banks attracted customers. ING Direct offers a $75 cash bonus when you deposit at least $1,000 in your account each month. This service is offered with the ING Orange Everyday Account.

Rates last updated December 5th, 2016
$
Monthly Account Fee Debit Card Access ATM Withdrawal Fee Fee Free Deposit p.m. Details
ING DIRECT Orange Everyday Account
Get a $75 cash bonus.
Get a competitive ongoing variable rate when linked with a Savings Maximiser.
Visa $0 $1,000 No monthly fees, and you can use any ATM in Australia for free when you deposit $1,000 each month e.g your salary. Open More

Tip 11: You should never pay monthly fees

There are several types of accounts that have no fees attached to them. These are known as fee-free bank accounts. Some accounts have no monthly fees, others have no monthly fees if you meet certain conditions and some have no fees for ATM use. There are plenty of options available to help you save money. Before opening an account, compare the fees between accounts and check if there are any conditions to meet.

Rates last updated December 5th, 2016
$
Monthly Account Fee Debit Card Access ATM Withdrawal Fee Fee Free Deposit p.m. Details
ING DIRECT Orange Everyday Account
Get a $75 cash bonus.
Get a competitive ongoing variable rate when linked with a Savings Maximiser.
Visa $0 $1,000 No monthly fees, and you can use any ATM in Australia for free when you deposit $1,000 each month e.g your salary. Open More
AMP Access Account
An everyday transaction account with fee-free banking.
Visa $0 $0 Unlimited fee-free transactions at rediATMs, $0 transaction fees using BankNet, mobile banking and BankPhone. Open More

Tip 12: Always look beyond the honeymoon rate

Now this tip doesn’t only apply to newlyweds. A honeymoon rate is a discounted initial rate designed to make loan offers more attractive to borrowers. Honeymoon rates are generally offered at the beginning on the loan period - typically the first six or 12 months.

Rates last updated December 5th, 2016
$
$
months
Maximum Variable Rate p.a. Standard Variable Rate p.a. Bonus Interest p.a. Fees Min Bal / Min Deposit Interest Earned
ME Online Savings Account
Ongoing, variable 3.05% p.a. rate when you link to a ME Everyday Transaction account and make a weekly purchase with your Debit MasterCard using tap & go. Available on balances up to $250,000.
3.05% 1.30% 1.75% $0 $0 / $0 Open More
ING DIRECT Savings Maximiser
Ongoing, variable 2.75% p.a. when you link to an ING Orange Everyday bank account and deposit $1,000+ each month. Available on balances up to $100,000.
2.75% 1.60% 1.15% $0 $0 / $0 Open More
RaboDirect High Interest Savings Account
Introductory rate of 3.20% p.a. for 4 months, reverting to a rate of 2.05% p.a. Available on balances below $250,000.
3.20% 2.05% 1.15% $0 $0 / $0 Open More
ANZ Progress Saver
Ongoing, variable 1.91% p.a. when you link to any Australian everyday bank account and deposit $10+ each month. Available on the entire balance.
1.91% 0.01% 1.90% $0 $10 / $10 Open More
Westpac Reward Saver
Ongoing, variable 1.85% p.a. when you deposit at least $50 and make no withdrawals each month. Available on the entire balance.
1.85% 0.01% 1.84% $0 $0 / $0 Open More
Bank of Melbourne Incentive Saver
Ongoing, variable 1.85% p.a. when you make at least one deposit and no withdrawals each month. Available on the entire balance.
1.85% 0.01% 1.84% $0 $1 / $1 Open More
Australian Unity Easy Saver
Introductory rate of 2.90% p.a. for 4 months, reverting to a rate of 1.70% p.a. Available on balances below $250,000.
2.90% 1.70% 1.20% $0 $0 / $0 Open More
BankSA Incentive Saver Account
Ongoing, variable 1.85% p.a. when you make at least one deposit each month and no withdrawals. Available on the entire balance.
1.85% 0.01% 1.84% $0 $0 / $0 Open More
AMP Cash Manager
Ongoing, variable 1.50% p.a. when you link to an AMP Visa debit card and deposit $2,000+ each month. Available on the entire balance.
1.50% 1.50% 0.00% $5 $0 / $0 Open More
HSBC Flexi Saver Account
Ongoing, variable 2.00% p.a. when you link to any Australian bank account and deposit $300+ each month (other conditions apply). Available on balances up to $5,000,000.
2.00% 1.50% 0.50% $0 $0 / $0 Open More
Bankwest Hero Saver
Ongoing, variable 2.65% p.a. rate when you deposit at least $200 each month and make no withdrawals. Available on balances up to $5,000,000.
2.65% 0.01% 2.64% $0 $0 / $0 Open More

So since you have these tips under your belt, banking won’t seem like such a difficult and scary experience.

Shirley Liu

Shirley is finder.com.au's publisher for banking and investments. She is currently studying a Masters in Commerce (Finance) and is the author of hundreds of articles. She is passionate about helping Aussies make an informed decision, save money and find the best deal for their needs.

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ME Online Savings Account

Maximum Variable Rate

3.05%

Standard Variable Rate

1.30
ING DIRECT Savings Maximiser

Maximum Variable Rate

2.75%

Standard Variable Rate

1.60
Bankwest Hero Saver

Maximum Variable Rate

2.65%

Standard Variable Rate

0.01
RaboDirect High Interest Savings Account

Maximum Variable Rate

3.20%

Standard Variable Rate

2.05

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