Deceptive Average Daily Balance-Based Fees

Monday, January 30, 2012

Many banks charge a fee if a minimum balance isn't maintained in a checking account. Frequently this is calculated in terms of an "average daily balance", a running total of where an account holder stands every day in maintaining that minimum average. But no bank provides a way for account holders to track it themselves, nor provide the metric they use. And, as The New York Times has noted, banks frequently don't calculate the average until the end of the month.

Ron Lieber co-authored that New York Times story, and here to explain more.

Guests:

Ron Lieber

Comments [3]

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There's a lot of people that I think would really appreciate your content. Please let me know. Cheers

Mar. 06 2013 11:42 PM
listener

Why no mention of the names Dodd, Frank and Durbin in relation to banking fees?

Jan. 30 2012 09:54 AM
Paul from Long Island, NY

My former bank imposed a monthly fee of $9.00 if my actual balance slipped below $100 at any time during the month. After being charged $9.00 because my balance on one day was $99.97 (and my balance the previous and subsequent day was well over $1,000), I moved my money to a credit union. The credit union offers free checking and pays 3.5% interest on balances up to $25,000. I was a customer at my former bank for over 10 years. By the way, I get free ATM access at any other local credit union branches as well as CVS pharmacies.

Jan. 30 2012 09:47 AM

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